TriOptima’s portfolio compression service, triReduce, contributed $24.5 trillion of the $25 trillion in CDS notional principal reductions reported by ISDA today.
TriOptima has offered 39 compression cycles since the beginning of the year and will offer 9 additional compression cycles in November and December as the industry focuses its efforts on reducing the notional principal outstandings.
TriOptima’s CDS compression cycles include American, European, Emerging Market, Asian and Japanese indices; ABX and CMBX indices; American and European tranches; US, European, Emerging Market, Japanese, and Asian single name CDS; and special cycles for single names and indices affected by credit events like Washington Mutual, Fannie Mae, Freddie Mac, Lehman and the Icelandic banks.
“As ISDA reports, the industry has worked with TriOptima’s infrastructure this year to actually reverse the growth in outstanding notional amount of CDS trades,” said Brian Meese, group ceo. “It is important to note that TriOptima’s infrastructure has been in use by the CDS industry for more than three years, and comes not as a response to pressure, but is a clear example of successful self-organization around healthy operational principles. “
