Derivatives
Derivatives are an essential tool for the management of risk and a flexible and exciting vehicle for clients to explore investment opportunities. We advise on the full range of OTC and exchange-traded derivatives and we cover the full spectrum of underlyings, from plain vanilla interest rate and currency derivatives, through credit and equity-based products and derivatives linked to real estate, insurance and pensions as well as commodity and emissions derivatives. Our clients range from sophisticated financial institutions to occasional end-users of derivatives. We regularly work with banks, insurers, pension funds, investment funds, sovereign entities and we are well known for advising the treasury departments of corporate clients.
Areas of our derivatives practice with particular strength include our ability to advise on:
- complex and innovative derivatives products and structures, and associated collateralisation, often forming part of a wider structured finance or securitisation transaction;
- credit default swaps, repo financing structures, total return swaps (relating to loans, bonds, asset-backed securities and equities), structured notes and equity-backed collar financings;
- derivatives in the context of reinsurance, repackaging of assets and/or cash flows and implementation of asset allocation strategy;
- derivatives within restructuring and insolvency matters as well as high profile disputes and regulatory investigations relating to derivatives and benchmark rates; and
- the expanding and evolving landscape of derivatives regulation.
We are client focused rather than product focused. Central to our culture is the priority we give to the specific needs of our clients with whom we develop strong professional and personal relationships.
Our extensive experience, combined with our lawyers technical excellence and commercial awareness enables us to deliver creative and practical solutions on a wide range of international transactions covering the full spectrum of precedent types and exposures.
Key experience
Advising NewDay Cards Ltd on the establishment of a new master issuer structure in respect of its “merchant offering” and also its “direct-to-consumer” credit card master trust securitisations, including advising on cross currency interest rate swap agreements and related rating requirements for hedging interest rate risk in non-sterling note issuances.
Advising bank on a range of more complex repo and securities lending arrangements facing other major international investment banks - including repo and reverse repo pairs and securities lending arrangements involving the acquisition of highly structured, asset-backed notes.
Advising on a series of credit default swap transactions where bank writes protection to another credit institution against the risk of default by underlying derivatives clients. The transactions are driven by the credit institutions’ desire to de-risk their exposure to the underlying clients and also in many cases to achieve regulatory capital mitigation.
Advising bank on the establishment and amendment of total return swap transactions over loans which are subject to restructuring proceedings in a number of different jurisdictions.
Advising on the entry into hedging transactions to hedge its obligations under a loan facility agreement, which involved negotiating and agreeing ISDA Master Agreement, a guarantee and amendments to the loan facility agreement with the bank counterparty.
Advising bank in connection with amendments to an existing super senior swap and senior index-linked credit agreement with a UK private utility company, and subsequent transfer of the credit agreement to a third party investor (including moving of protections/features from the credit agreement to the swap position retained by the bank).
Advising bank on ISDA documentation (including collateral documents) for use with English pension fund clients or investment managers acting on behalf of such pension funds.
Advising European financial institution on their customer terms and conditions for foreign exchange and interest rate derivatives.
Advising leading consumer goods company on a range of issues relating to their derivatives including interest rate benchmarks, commodity and emissions documentation, tax and regulatory matters and advice on counterparty credit exposure concerns.
Advising multinational oil and gas company on derivatives documentation and terms specific to commodities trades, including market disruption events, disruption fallbacks and terms relating to early termination.
Advising international chemicals company on ISDA emissions trading documentation into its existing ISDA arrangements and on the establishment and structure of back-to-back arrangements with its subsidiary owner of emission allowances.
Key Contacts
