Novation

This Issue in United States

Novation Protocol

Concept of Novation Protocol in the context of derivatives contract, by the International Swaps and Derivatives Association (ISDA): A document published by ISDA (International Swaps and Derivatives Association, Inc.)that defines the market standard procedures for novating interest rate and credit derivative (i.e. an instrument that transfers risk from one party to the other) transactions. Protocol demands that the stepping-out party informs the remaining party that they (stepping-out party) have assigned a trade to a new dealer.

Resources

See Also

• Derivatives Contract

Novation (see Assignment)

Concept of Novation (see Assignment) in the context of derivatives contract, by the International Swaps and Derivatives Association (ISDA): The process by which one counterparty (transferor) agrees to transfer to a third party (transferee) its obligations under an existing transaction they have with another counterparty (remaining party), (see also Stepping-in/out).

Resources

See Also

• Derivatives Contract