ISDA's Collateral Steering Committee has been looking into whether negative interest rates should be used when determining the rate paid on collateral under terms of the credit support annex. "This issue of negative rates has been bubbling up for a while," Michael Clarke, a managing director at Goldman Sachs, said at ISDA's Annual General Meeting in Singapore. "The proposal, which still needs to be finally ratified, is that there should be a best-practice statement issued by ISDA clarifying that if you have not amended the interest-rate provisions in the CSA, then one should interpret that as meaning negative rates will flow through the agreement and will be settled."

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