Sovereign

The Jolly Contrarian’s Glossary The snippy guide to financial services lingo.™ Go Premium Index — Click the ᐅ to expand: Glossary Comments? Questions? Suggestions? Requests? Insults? We’d love to 📧 hear from you. Sign up for our newsletter.

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”).
view template

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.

Or claim sovereign immunity; as to which there is more to say elsewhere.

See also

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