Wednesday, December 17, 2008

ISDA to Publish Protocol for Ecuador [Default]

NEW YORK, Wednesday, December 17, 2008 – The International Swaps and Derivatives Association, Inc. (ISDA) today announced that it will launch a CDS auction protocol to facilitate the settlement of credit derivatives trades referencing Ecuador, the South American country that is in default for the second time this decade. The 2008 Ecuador CDS Protocol will be the first protocol published by ISDA in regards to the settlement of a sovereign credit event.

Ecuador’s government did not make a $30.6 million interest payment within the 30 day grace period that started after the country failed to make its payment for the original due date which was November 15. Ecuador, which also defaulted in 1999, owes approximately $10 billion to bondholders, multilateral lenders and other countries.

The Protocol will be open to ISDA members and non-members alike. ISDA will publish further details in due course and these will be available at

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