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Amwelladmin (talk | contribs) No edit summary Tag: Reverted |
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[[Default Rate - ISDA Provision|Default]] interest is one of those perennial things in finance and is generally a rate higher than the implied funding rate for the period and person in question. You might well ask — though one might, as the [[JC]] does, struggle heroically to not go there — whether an arbitrary loading on what ought to be a fair estimate of one’s actual carrying cost is not an unenforceable [[Penalty clause|penalty]], but hey, everyone does it. | [[Default Rate - ISDA Provision|Default]] interest is one of those perennial things in finance and is generally a rate higher than the implied funding rate for the period and person in question. You might well ask — though one might, as the [[JC]] does, struggle heroically to not go there — whether an arbitrary loading on what ought to be a fair estimate of one’s actual carrying cost is not an unenforceable [[Penalty clause|penalty]], but hey, everyone does it. | ||
The {{isdaprov|Default Rate}} appears in two contexts: firstly, | The {{isdaprov|Default Rate}} appears in two contexts: firstly, {{isdaprov|prior to Early Termination}} under Section {{isdaprov|9(h)(i)}}, to deal with rate payable ''after'' a [[Failure to Pay or Deliver - ISDA Provision|payment or delivery failure]] giving rise to an {{isdaprov|Event of Default}} — also if there is a deferral brought about as a result of a {{isdaprov|Force Majeure}} or {{isdaprov|Illegality}}), but ''before'' the {{isdaprov|Non-defaulting Party}} has designated an {{isdaprov|Early Termination Date}}: in theory at any rate, thanks to Section {{isdaprov|2(a)(iii)}} that period could be quite a long time — potentially indefinite, if you haven’t caved in to the need to seem like a reasonable guy and agreed a {{isdaprov|Condition End Date}} limitation. | ||
Secondly, in the definition of {{isdaprov|Applicable Close-out Rate}} — a veritable beast in itself. | Secondly, in the definition of {{isdaprov|Applicable Close-out Rate}} — a veritable beast in itself. |