Template:Nutshell GMSLA 5.5: Difference between revisions

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Where {{gmslaprov|5.5}} applies, the {{gmslaprov|Posted Collateral}} in respect of any {{gmslaprov|Loan}} bears the same proportion to the {{gmslaprov|Market Value}} of the {{gmslaprov|Loaned Securities}} as the {{gmslaprov|Posted Collateral}} bore at the commencement of the {{gmslaprov|Loan}}. Accordingly: <br>
Where {{gmslaprov|5.5}} applies, the {{gmslaprov|Posted Collateral}} on any {{gmslaprov|Loan}} must bear the same proportion to the {{gmslaprov|Market Value}} of the {{gmslaprov|Loaned Securities}} as it bore at the beginning of the {{gmslaprov|Loan}}. Therefore: <br>
:(a) the {{gmslaprov|Market Value}} of the {{gmslaprov|Posted Collateral}} must always equal the {{gmslaprov|Required Collateral Value}}; <br>
:(a) the {{gmslaprov|Market Value}} of the {{gmslaprov|Posted Collateral}} must always equal the {{gmslaprov|Required Collateral Value}}; <br>
:(b) whenever the {{gmslaprov|Market Value}} of the {{gmslaprov|Posted Collateral}} for any {{gmslaprov|Loan}} (including unpaid amounts and unpaid {{gmslaprov|Income}} on {{gmslaprov|Non-Cash Collateral}}) exceeds the {{gmslaprov|Required Collateral Value}} under the {{gmslaprov|Loan}} (including all amounts due by the {{gmslaprov|Borrower}} and <br>
:(b) whenever the {{gmslaprov|Market Value}} of the {{gmslaprov|Posted Collateral}} for any {{gmslaprov|Loan}} exceeds the {{gmslaprov|Required Collateral Value}} under the {{gmslaprov|Loan}} {{gmslaprov|Lender}} must repay to {{gmslaprov|Borrower}} enough Equivalent Collateral to eliminate the excess; and <br>
::(ii) any {{gmslaprov|Income}} payable in respect of {{gmslaprov|Equivalent Securities}},<br>
:(c) whenever the {{gmslaprov|Market Value}} of the {{gmslaprov|Posted Collateral}} falls below the {{gmslaprov|Required Collateral Value}} {{gmslaprov|Borrower}} shall (on demand) provide further {{gmslaprov|Collateral}} to {{gmslaprov|Lender}} to eliminate the deficiency.<br>
:{{gmslaprov|Lender}} shall repay to {{gmslaprov|Borrower}} such Equivalent Collateral to eliminate the excess; and <br>
:(c) whenever the {{gmslaprov|Market Value}} of the {{gmslaprov|Posted Collateral}} together with: <br>
::(i) all amounts due by the Lender under the Loan; and <br>
::(ii) any {{gmslaprov|Income}} payable on {{gmslaprov|Non-Cash Collateral}} <br>
:falls below the {{gmslaprov|Required Collateral Value}} together with: <br>
::(i) all amounts due by the {{gmslaprov|Borrower}} under the {{gmslaprov|Loan}}; and <br>
::(ii) any {{gmslaprov|Income}} payable under the {{gmslaprov|Equivalent Securities}}, {{gmslaprov|Borrower}} shall (on demand) provide further {{gmslaprov|Collateral}} to {{gmslaprov|Lender}} to eliminate the deficiency.<br>

Revision as of 10:54, 5 September 2016

Where 5.5 applies, the Posted Collateral on any Loan must bear the same proportion to the Market Value of the Loaned Securities as it bore at the beginning of the Loan. Therefore:

(a) the Market Value of the Posted Collateral must always equal the Required Collateral Value;
(b) whenever the Market Value of the Posted Collateral for any Loan exceeds the Required Collateral Value under the Loan Lender must repay to Borrower enough Equivalent Collateral to eliminate the excess; and
(c) whenever the Market Value of the Posted Collateral falls below the Required Collateral Value Borrower shall (on demand) provide further Collateral to Lender to eliminate the deficiency.
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