This section of our University provides members with operational advice, guidance, and assistance on the rules and regulations around how the trading process should occur. Drawing on our expertise in operations, documentation, and data-driven analytics, we identify best practices for MEIs, CUSIPs, FpML, and more.
Primary Delayed Compensation Protocol
The Protocol applies to a “Primary Allocation” which is an allocation of new money by a syndicate desk in connection with either (i) a new issue syndication or (ii) an amendment of an existing Credit Agreement. In addition, the Protocol affects when-issued secondary trades by (i) changing what constitutes an Early Day Trade and (ii) creating a Post Funding Trade.
Glossary of Terms
Glossary of Terms relating to Delayed Compensation for Primary Allocations, Early Day Trades and Post Funding Trades
CUSIP numbers uniquely identify financial instruments in the United States and Canadian financial markets. The CUSIP number consists of 9 alphanumeric characters. It is issued by CUSIP Global Services (CGS) which is operated by Standard & Poor’s under license from the American Bankers Association. CUSIP numbers identify a wide variety of financial instruments including, without limitation, stocks, bonds, commodities and syndicated loans. CUSIPs are REQUIRED in order to utilize: LoanServ Position Reconciliation Platform Markit Clear Trade Matching Platform Loan/SERV – Cash on Transfer FpML Messaging
Primary Delayed Compensation Podcast
In this podcast, Ellen Hefferan, Executive Vice President of Operations & Accounting, highlights the Primary Delayed Compensation and the purpose behind doing a primary delayed comp.
Primary Delayed Compensation Flowchart - Post-Trigger Allocation
The LSTA has developed this flowchart to illustrate how Delayed Compensation is to be applied for a Post-Trigger Allocation on a step-by-step basis.
Primary Delayed Compensation Cheat Sheet
The nine categories together with applicable Ready Dates and Commencement Dates are reflected in this “cheat sheet”, which should be memorialized on the desks of all loan market participants.
A Markit Entity Identifier (“MEI”) is a unique code issued to uniquely identify legal entities in the loan market, including, without limitation, banks, buy-side institutions, custodians, trustees and corporate borrowers. The MEI is a required element to enable transmission of information across processing and communication platforms including agency, settlement, front, middle and back-office systems.
Secondary Delayed Compensation - Pre-Trigger Trades
The LSTA has developed this flowchart to illustrate how Secondary Delayed Compensation on Pre-Trigger Trades is to be applied on a step-by-step basis.
Secondary Delayed Compensation - Post-Trigger Trades
The LSTA has developed this flowchart to illustrate how Secondary Delayed Compensation on Post-Trigger Trades is to be applied on a step-by-step basis.
Risk Management 101 - Reduce Settlement Times *New*
As 2021 Secondary Trade Volume is on pace to surpass $800B, the mean par settlement times have trended above their five-year average for the better part of the past 15 months. Overall, while 29% of par trades settle within T+7, 27% settle later than T+20.