Much of EMTA's work is accomplished through the efforts of various Working Groups, which are composed of market participants who collaborate to identify key industry issues, formulate possible solutions and develop market-wide consensus for resolving these issues. As the name suggests, Working Groups generally do not function as standing committees, but rather as informal groups formed by the Board of Directors or the Executive Director to respond to specific needs of the marketplace. Some Groups are formed to deal with a single issue and others serve as the main forum for resolving issues that relate to a specific product or business area, while still others serve solely to provide a forum for discussion. Working Groups meet informally from time to time. EMTA Members may access any Working Group’s formal Market Practice recommendations on EMTA’s website.
Interest Groups are comprised of both EMTA Members and interested non-members, serving mainly as contact lists for disseminating information on topics of interest. Interest Groups may form the basis for a Working Group to address a specific issue of relevance, and Working Groups may evolve into Interest Groups once the Working Group has resolved these issues.
EMTA’s Working and Interest Groups include:
Bonds and Loans. This Interest Group monitors and updates the work of EMTA’s first Working Groups, including the Bond Trading, Warrants and Loan Trading Working Groups. These original EMTA Working Groups developed a basic infrastructure for, and implemented Market Practices and standard documentation to facilitate, efficient trading of these traditional Emerging Markets assets. EMTA Members may Click Here to access the Bond/Loan Market Practices and Click Here to access the Standard Documentation recommended by these Working Groups.
The Bond Trading Working Group was originally formed in 1999 to address a variety of issues affecting Emerging Markets bond trading and investment. This Group has recommended Market Practices for trades of Argentina, Ecuador and Ivory Coast bonds in default and, most recently, for Argentine Eurobonds and Uruguay PIK bonds and Argentina and Serbia when-issued trades.
The Warrants Working Group was originally formed in 1995 to address various settlement problems associated with the warrants that traded with certain Brady bonds. Among other things, this Group coordinated an industry-wide reconciliation effort with Euroclear, and developed Market Practice recommendations regarding the separate trading of warrants and their related Mexican, Venezuelan and Nigerian bonds.
The Loan Trading Working Group was originally formed in 1994 to address a variety of issues affecting Emerging Markets loan trading. The Group developed Standard Terms for Assignments of Loan Assets (including a Market Practice Guide) and Standard Participation Terms for Yugoslavia, Russia, Peru and Ivory Coast. The Group is also responsible for recommending Market Practices, including general buy-in and sell-out procedures for loan assets.
Contact: Aviva Werner
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FX and Currency Derivatives. The FX and Currency Derivatives Working Group (also referred to as the NDF Working Group) seeks to address issues relating to trading in Emerging Markets currencies, many of which trade on a non-deliverable basis. A small advisory committee guides this Working Group, and country (currency-specific) subgroups are formed and meet as necessary.
Formed in 1997, this Working Group’s first significant effort was its extensive collaboration with the International Swaps and Derivatives Association (ISDA) and the Foreign Exchange Committee of the Federal Reserve Bank of New York (FXC) to draft the 1998 FX and Currency Option Definitions and Annex A thereto. These provided the market with a much-needed architecture for the documentation of FX and currency option transactions generally and, in particular, provided an appropriate vocabulary for the documentation of transactions involving Emerging Market currencies. EMTA continues to work with ISDA and the FXC to update and expand these materials for the marketplace’s use. In addition, the Working Group has produced, and continues to update, currency-specific standard terms for many non-deliverable forward and currency option transactions reflecting, and in some circumstances, introducing improvements to, current Market Practices for trading in that currency. A significant focus for the Working Group in recent years has been to enhance the recommended documentation to better withstand the effects of long-term local market disruptions, as is reflected in its work in both the Latin American and Asian regions.
Responding to the Russian Ruble crisis in 1998, the FX and Currency Derivatives Working Group, in conjunction with the Chicago Mercantile Exchange (CME), developed a back-up mechanism for quotation of the Ruble/Dollar exchange rate, which has since become the primary settlement rate for the market. A similar collaborative effort was later undertaken with the CME for Brazilian Real/Dollar and Argentine Peso/Dollar rate quotations. Evolving out of these efforts, EMTA currently conducts a daily poll of industry participants to discover the Argentine Peso/Dollar exchange rate, the primary settlement rate now used by the market, and also has developed mechanisms for back-up surveys in a number of currencies.
Significantly, the Working Group issues, from time to time, recommendations to the market ("NDF Market Practices"), as well as standard documents in response to market events and to further its documentation initiatives. EMTA Members may Click Here to access the NDF Market Practices and Click Here to access the Standard Documentation recommended by this Working Group.
Contact: Leslie Payton Jacobs
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Legal and Compliance. This Working Group (which consists of lawyers and compliance personnel who either are employed internally by, or are affiliated with, EMTA Members) meets, from time to time, to discuss a variety of legal and compliance issues relevant to the Emerging Markets asset class. It is also within this forum that issues relating to international financial architecture, debt restructuring and investor rights are discussed. To review a list of topics that have been discussed at this Group's meetings, please Click Here.
Contact: Aviva Werner/Michael M. Chamberlin
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