-97-
checking with the trader as to the potential pricing of the
transaction.
During the relevant years, FNBC generally required its
traders to use ISDA documentation for its swaps, and its swaps
were subject to ISDA conventions.
b. Number Employed in Chicago
FNBC’s Chicago swap operation employed three traders of
interest rate swaps and one other individual, the head of the
trading desk, who supervised these three traders. Two of the
three traders traded U.S. dollar denominated interest rate swaps,
and the third trader traded Canadian dollar denominated interest
rate swaps. One of the two traders of U.S. dollar denominated
interest rate swaps traded short-term swaps, and the other traded
long-term swaps.
c. Practice as to Quotations
FNBC’s traders typically quoted the same bid and ask rates
for all potential counterparties rated A- or better. FNBC’s bid
and ask quotes were driven by the market bid and ask quotes and
the risk position of FNBC’s portfolio. FNBC’s traders agreed to
the terms of a plain vanilla interest swap in a matter of
seconds.
In pricing potential swap transactions, FNBC’s traders
attempted to determine where the market was at that time and,
given their views on interest rate movement, price their swaps on
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