Our assistance falls predominantly into four discrete areas:

Structured finance transactions, synthetics and credit derivatives
Structured and OTC equity and commodity derivative products
Structured and OTC derivatives regulation
Structured products and derivatives dispute resolution, insolvency and risk management

Structured finance transactions, synthetics and credit derivatives
Mayer Brown's derivatives and structured products practice is well-suited to service its clients on a global basis and to help them thrive during the challenging credit conditions that today’s markets present.   We provide broad transactional advice for a diverse client base and have experience across a spectrum of structured finance, credit derivatives and synthetic transactions.

We regularly structure, document and provide transaction execution assistance on complex credit-linked note programs, repackagings and other synthetic and hybrid products for clients around the global. We also represent dealers and end users in credit default swaps, total return swaps on portfolio and single name exposures, and on a variety of structured asset classes.  We regularly advise on hedging strategies in securitizations, project finance and real estate finance transactions.

An additional and significant factor that underlies our success is our broad experience with the regulatory and financial accounting issues that become relevant when derivatives are used to create, or are embedded in, structured finance transactions. Our relationships with the relevant regulatory bodies around the world have been carefully built over the years, and lawyers in our group are often approached to act as a sounding board as new policies are developed.

Here is what we mean:

• Because of our global reach, we were asked to structure a $3.5 billion cross-border securities lending transaction for CLO positions in a large negative-basis trade portfolio and to analyze  voting and other related provisions in dozens of the related credit default swaps.
• When Bear Stearns faced potential liquidation, we represented the manager of a large Bear Stearns' derivatives subsidiary, analyzing that subsidiary's positions and restructuring important obligations and duties.
• We advised a global financial institution in restructuring large super-senior positions to eliminate junior debt and allow monolines providing credit default coverage to avoid making protection payments.
• Because of our multi-product strength, we were called upon to design a structured cross-collateralized and credit-enhanced back-to-back swap program to create a synthetic AA-rated swap product eligible for participation in public finance interest swap structures.
• We acted as international counsel to The Hong Kong Mortgage Corporation and Cagamas Berhad (the national mortgage corporations of Hong Kong and Malaysia respectively) in preparing master program documentation for the Malaysian joint venture that they established to provide residential mortgage guarantees to Malaysian mortgage lenders.  The program offers two types of products initially - a conventional guarantee in the form of a bespoke credit default swap based on ISDA documentation and an Islamic guarantee in the form of a Kafalah/Wakalah structure.

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Structured and OTC, equity derivatives and commodity derivatives products
Structured products have grown to bring derivatives technology to equity investments and commodities. Our derivatives lawyers understand the world of equity and index derivatives, derivatives-linked securities, fund-linked derivatives, commodity-linked derivatives (including emissions trading, weather derivatives and synthetic commodity derivatives), CPPI products, hybrids and other exotic derivatives. We design monetization and hedging transactions such as prepaid forwards, monetizing collars and issuer options. We are regularly called upon to bring together the worlds of hedge funds and financial institution clients by structuring leveraged total return swap programs linked to loan portfolios, indicies, hedge fund portfolios and other asset pools. Additionally, we combine our derivatives experience with our extensive private investment fund practice to create a variety of fund structures for facilitating synthetic investment opportunities.
Examples of our transactional experience include:

• Structuring knock-out call options linked to hedge fund of funds and synthetic “unallocated cash returns,” subject to semi-annual basket rebalancing.
• Structuring a variable PPVUL hedge fund of funds linked leveraged total return swap, collateralized by feeder level investment holders and subject to monthly increases and decreases for new investments and redemptions by separate account holders.
• Establishing an S&P Hedge Fund Index-linked leveraged total return swap with a variable asset allocation between the Index and defeasing instruments and subject to defeasance triggers and take out by a principal-protected EMTN linked to the Index with initial leverage of 4:1 subject to resets as the cushion changes.
• Designing a leveraged hedge fund of funds-linked total return swap, with embedded liquidity facility for making monthly purchases of reference assets and notional adjustments to offset total return shortfalls.
• Advising on monetizing a Middle East client's shareholding in a European subsidiary by entering into a complex total return swap with a European bank in a third jurisdiction.

Structured and OTC derivatives regulation
Backed by the firm’s Financial Services Regulatory & Enforcement practice, we provide advice on securities and derivatives regulation, including exchange regulations, market abuse and MiFID. Our experience includes advising financial institutions and providing opinions on the Capital Requirements Directive.

Structured products and derivatives dispute resolution, insolvency and risk management
The fallout from the credit crisis has led to increased risk of litigation against arrangers of derivatives, structured finance and structured products transactions.  Our derivatives and structured products lawyers work closely with our litigation and insolvency lawyers to provide seamless advice to our clients on litigation and insolvency issues impacting structured products and derivatives.
Examples of our experience include:

• When the Canadian commercial paper market virtually froze, and some banks refused liquidity draw requests, one of the worlds largest international financial institutions appointed Mayer Brown to dispatch insolvency and structured finance lawyers to Toronto for complex and ongoing workout discussions.
• In response to the challenges that have arisen in the monoline insurance industry, we have been  asked to advise a number of the world’s largest global banks on their “monoline exposures.” We have reviewed and provided advice with respect to hundreds of negative basis trades entered into with monoline vehicles, and credit default swaps entered into for the purpose of hedging monoline exposure. We also establish innovative credit derivatives products for companies to exploit new market opportunities.
• We successfully represented a secured creditor, in both the High Court and Court of Appeal in London, in connection with the collapse of the largest ever SIV, Sigma Finance. The dispute related to the correct interpretation of the rights of secured creditors.
• Our London and New York offices were called upon by one of the world’s largest financial institutions to conduct a detailed risk and legal assessment on more than a 1,000 of their most complex bespoke portfolio credit default swap transactions and credit-linked note transactions.