Sovereign

One of ISDA’s vaunted netting categories.

Sovereign: A sovereign nation state recognized internationally as such, typically acting through a direct agency or instrumentality of the central government without separate legal personality, for example, the ministry of finance, treasury or national debt office. This category does not include a State of a Federal Sovereign or other political sub-division of a sovereign nation state if the sub-division has separate legal personality (for example, a Local Authority) and it does not include any legal entity owned by a sovereign nation state (see “Sovereign-owned entity”).
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Also one who might claim sovereign immunity, a status likely to get all your resident chicken lickens squawking and gabbling, though in the context of a daily margined master trading agreement, less of a drama than it might seem.

Of course sovereigns are just the types to go "who's queen?" and refuse to provide you with credit support.

See also

• ISDA netting categories
• close-out netting
• ISDA Anatomy