On October 11, 2014, the International Swaps and Derivatives Association (“ISDA”) announced that 18 banks have agreed to sign the new ISDA Resolution Stay Protocol. The Protocol, which will take effect from January 1, 2015, will impose a stay on cross-default and early termination rights in standard ISDA derivatives contracts between any of the 18 firms if one of them is subject to resolution. The press release states that regulators have committed to developing new regulations in their jurisdictions in 2015 that will promote broader adoption of the stay provisions beyond the 18 banks, a commitment that is also being pushed by the Financial Stability Board. Coverage will also be expanded, by regulations, to include US financial holding companies. The 18 banks that have signed up to the ISDA Resolution Stay Protocol are Bank of America Merrill Lynch, Bank of Tokyo-Mitsubishi UFJ, Barclays, BNP Paribas, Citigroup, Credit Agricole, Credit Suisse, Deutsche Bank, Goldman Sachs, HSBC, JP Morgan Chase, Mizuho Financial Group, Morgan Stanley, Nomura, Royal Bank of Scotland, Societe General, Sumitomo Mitsui Financial Group and UBS.
The ISDA announcement is available at: