SWAP DEALERS UNVEIL STANDARD CONTRACT The International Swap Dealers Association has developed the first standard form contract for use by arrangers of currency and interest rate swap transactions, said Thomas Jasper, the Association's co-chairman. The contract, unveiled at a press conference , is expected to make the 300 billion dlr a year swap market more efficient, he said. "The contracts wil accelerate the process and reduce the expense of swap documentation," Japsper said. Privately, eurobond traders estimate that about 80 pct of all new issues eventually become part of either an interest rate or currency swap. An interest rate swap occurs when two issuers, usually acting through a bank middleman, agree to accept each other's interest payments on debt securities. Usually, the issuer of a floating rate debt security swaps into fixed-rate debt and vice versa. But the obligation for repayment of the debt remains with the original borrower. Bank regulators have become concerned about the use of swaps because the middleman, usually a bank, takes on some portion of the risk but is not required to show it on the balance sheet as a liability and may not have sufficient capital to cushion it. Kenneth McCormick, a co-chairman of the ISDA and president of Kleinwort Benson Cross Financing Inc, said the Bank of England and the U.S. Federal Reserve Board were expected later today to announce joint proposals for setting minimum capital standards for counterparties in swaps. The standards are part of the recently announced convergence agreement between the two countries in which regulators have attempted to set similar capital requirements for institutions. McCormick told reporters the ISDA was concerned that a "level playing field" be maintained in the swaps market. He said if U.K. And U.S. Banks were required to hold more primary capital against swap transactions than is the current practice, the additional costs would have to be passed on to issuers. The issuers might then choose to do business with lower-cost banks which are not subject to U.S. Or U.K. Banking rules. He said the ISDA had been working on a code of conduct for swap dealers as part of its self-regulatory effort. That code should be completed within the next few weeks, he said.