On August 1, 2014, ISDA's Americas Credit Derivatives Determination Committee (DC) resolved that a failure to pay credit event occurred on July 30, 2014 with respect to the Argentine Republic when Argentina missed a coupon payment on some of its restructured foreign-law bonds. The DC resolved to hold an auction for outstanding CDS transactions (see Practice Note, Understanding the Auction Settlement and Restructuring Supplement to the 2003 ISDA® Credit Derivatives Definitions). The DC also ruled that statements made by the Argentine government before its July 30, 2014 credit event did not trigger payment on CDS contracts that expired before that date. The DC decided that statements made in mid-June by the Argentine economy ministry that a June 30 coupon payment would be “impossible” to make due to a US court order could not be construed as a "repudiation or moratorium event" under its credit derivatives definitions (CDDs). Holders of some Argentine CDS contracts that expired before July 30, 2014 had requested that ISDA consider whether their protection could be extended under the CDDs in the hope they would receive a payout under their CDS.

On August 5, 2014, ISDA's EMEA Credit Derivatives Determination Committee resolved that a bankruptcy credit event had occurred with respect to ABB International Finance Limited. Since there are no deliverable obligations, the DC is unable to publish any auction settlement terms for this event and as such, no auction will be held for outstanding CDS on this reference entity.

On August 4, 2014, ISDA's Europe, Middle East and Africa (EMEA) Credit Derivatives Determination Committee resolved that a bankruptcy credit event had occurred with respect to Espirito Santo Financial Group S.A. The DC determined that no auction will be held for this event. On August 6, 2014, ISDA's EMEA Credit Derivatives Determination Committee resolved that a bankruptcy credit event did not occur with respect to a decision by the Portuguese Central Bank's decision to break up Banco Espirito Santo S.A. (BES). This decision means that credit protection payments under CDS contracts naming BES as reference entity will not be activated, and many junior bondholders face potentially substantial losses. The DC will meet again on August 8, 2014 to decide whether a succession event has occurred with respect to BES.

UPDATE: On August 8, 2014, the DC determined that a succession event had occurred with respect to BES on August 3, 2014.