The Loan Market Association (LMA) released guidelines on
transparency and the use of information on June 7.
While it only spanned three pages of text, its suggestion
that loans should not be traded based on borrower confidential
information – even if both parties have access to the
same level of information – has angered many in the
bank lending community.
The LMA guidelines on transparency and the use of
information, released on June 7, note that "market participants
should not trade on material information which has not been
made available to the whole of the lending syndicate."
In the section on best practice, the LMA said "this applies
even where the counterparty to that trade has access to the
same level of borrower confidential information".
"It's a good start in terms of getting the issues on the
table and working towards a solution which the markets will
accept," said Clifford Atkins from...