83,249
edits
Template:M comp disc Credit Derivatives 4: Difference between revisions
Template:M comp disc Credit Derivatives 4 (view source)
Revision as of 09:10, 25 April 2023
, 25 April 2023no edit summary
Amwelladmin (talk | contribs) No edit summary |
Amwelladmin (talk | contribs) No edit summary |
||
| Line 1: | Line 1: | ||
[[4.1 - Credit Derivatives Provision|The]] compare and contrast here is to the {{isdama}}. | [[4.1 - Credit Derivatives Provision|The]] compare and contrast here is to the {{isdama}}. Many reflect the fact that the ISDA, being a private transaction creating inherently volatile exposures, has hair-trigger termination rights that you would not expect in a long term senior debt financing arrangement. | ||
{{Tabletopflex}} | {{Tabletopflex}} | ||
|+ Comparison between 2002 Events of Default and 2014 Credit Events | |+ Comparison between 2002 {{isdaprov|Events of Default}} and 2014 {{cddprov|Credit Events}} | ||
{{aligntop}} | {{aligntop}} | ||
! {{isdama}} !! {{cdd}} !! Commentary | ! {{isdama}} !! {{cdd}} !! Commentary | ||
{{aligntop}} | {{aligntop}} | ||
| {{isdaprov|5(a)(i)}} {{isdaprov|Failure to Pay or Deliver}} || {{cddprov|4.5}} {{cddprov|Failure to Pay}} || | | {{isdaprov|5(a)(i)}} {{isdaprov|Failure to Pay or Deliver}} || {{cddprov|4.5}} {{cddprov|Failure to Pay}} || Note the {{cddprov|Payment Requirement}} threshold in the {{cdd}}. This is to ensure the derivative only catpures existential defaults and not merely irritating ones. | ||
{{aligntop}} | {{aligntop}} | ||
| {{isdaprov|5(a)(ii)}} {{isdaprov|Breach of Agreement}} || The “Repudiation” bit of {{cddprov|4.6}} {{cddprov|Repudiation/Moratorium}} || | | {{isdaprov|5(a)(ii)}} {{isdaprov|Breach of Agreement}} || The “Repudiation” bit of {{cddprov|4.6}} {{cddprov|Repudiation/Moratorium}} || | ||
| Line 12: | Line 12: | ||
| {{isdaprov|5(a)(iii)}} {{isdaprov|Credit Support Default}} || No equivalent || The point is to vouchsafe the creditworthiness of the specific {{cddprov|Reference Entity}}, not any old affiliate who might have guaranteed its obligations. If you want that, specify the affiliate guarantor as the {{cddprov|Reference Entity}}, and ensure that {{cddprov|Qualifying Guarantee}}s count. | | {{isdaprov|5(a)(iii)}} {{isdaprov|Credit Support Default}} || No equivalent || The point is to vouchsafe the creditworthiness of the specific {{cddprov|Reference Entity}}, not any old affiliate who might have guaranteed its obligations. If you want that, specify the affiliate guarantor as the {{cddprov|Reference Entity}}, and ensure that {{cddprov|Qualifying Guarantee}}s count. | ||
{{aligntop}} | {{aligntop}} | ||
| {{isdaprov|5(a)(iv)}} {{isdaprov|Misrepresentation}} || NA || | | {{isdaprov|5(a)(iv)}} {{isdaprov|Misrepresentation}} || NA || Misrepresentation is a bilasteral sort of a thing, and does not necessarily indicate complete collapse, and where it does, will be accompanied by more hard-edged events (like catastrophic Failures to Pay and Bankruptcy), so need not be separately mentioned. | ||
{{aligntop}} | {{aligntop}} | ||
| {{isdaprov|5(a)(v)}} {{isdaprov|Default Under Specified Transaction}} || {{cddprov|4.3}} {{cddprov|Obligation Acceleration}} || | | {{isdaprov|5(a)(v)}} {{isdaprov|Default Under Specified Transaction}} || {{cddprov|4.3}} {{cddprov|Obligation Acceleration}} || | ||