Deliveries of Income - GMSLA Provision: Difference between revisions
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Just what these customary and appropriate endorsements or assignments might be, and why the [[Manufactured payments in respect of Loaned Securities - GMSLA Provision|manufacturer]] has to grant them, even where the actual securities issuer didn’t, we can only speculate. Perhaps — speculation here — it is because the {{gmslaprov|Borrower}} is most likely to have immediately sold the {{gmslaprov|Loaned Securities}} into the market — the major purpose of a {{Gmsla}} being short selling, after all — and so won’t ''get'' any {{gmslaprov|Income}} under the shares, much less any “customary endorsements” relating to it, whatever in this day and age that might mean. | Just what these customary and appropriate endorsements or assignments might be, and why the [[Manufactured payments in respect of Loaned Securities - GMSLA Provision|manufacturer]] has to grant them, even where the actual securities issuer didn’t, we can only speculate. Perhaps — speculation here — it is because the {{gmslaprov|Borrower}} is most likely to have immediately sold the {{gmslaprov|Loaned Securities}} into the market — the major purpose of a {{Gmsla}} being short selling, after all — and so won’t ''get'' any {{gmslaprov|Income}} under the shares, much less any “customary endorsements” relating to it, whatever in this day and age that might mean. | ||
The same goes — with less certainty, perhaps<ref>The {{gmslaprov|Lender}} isn’t acquiring the {{gmslaprov|Collateral}} with the express purpose of selling it, although it does acquire it by [[title transfer]] and absolutely is entitled to sell it.</ref> — for the {{gmslaprov|Lender}} of {{gmslaprov|Collateral}} that is has received by [[title transfer]]. So it would be interesting to contrast this with the equivalent provision in the {{pgmsla}}, wouldn’t it. | The same goes — with less certainty, perhaps<ref>The {{gmslaprov|Lender}} isn’t acquiring the {{gmslaprov|Collateral}} with the express purpose of selling it, although it does acquire it by [[title transfer]] and absolutely is entitled to sell it.</ref> — for the {{gmslaprov|Lender}} of {{gmslaprov|Collateral}} that is has received by [[title transfer]]. So it would be interesting to contrast this with the [[4.3 - Pledge GMSLA Provision|equivalent provision]] in the {{pgmsla}}, wouldn’t it. | ||
Let’s therefore go and do that. Back in a minute. | Let’s therefore go and do that. Back in a minute. | ||
Back! Sure enough, paragraph {{pgmslaprov|4.3}} of the {{pgmsla}} doesn’t mention {{pgmslaprov|Collateral}}, since it is never title transferred to the {{pgmslaprov|Lender}} in the first place. | |||
{{sa}} | |||
*Paragraph {{pgmslaprov|4.3}} ({{pgmslaprov|Deliveries of Income}}) of the {{pgmsla}} | |||
{{ref}} | {{ref}} | ||
Latest revision as of 12:45, 8 August 2019
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GMSLA Anatomy™
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Freshfields’ guidance notes to the 2010 2010 GMSLA helpfully provide that “Paragraph 4.4 provides for the mechanism for the delivery of income payments.” Well, gee, fellas — thanks for writing in.
Just what these customary and appropriate endorsements or assignments might be, and why the manufacturer has to grant them, even where the actual securities issuer didn’t, we can only speculate. Perhaps — speculation here — it is because the Borrower is most likely to have immediately sold the Loaned Securities into the market — the major purpose of a 2010 GMSLA being short selling, after all — and so won’t get any Income under the shares, much less any “customary endorsements” relating to it, whatever in this day and age that might mean.
The same goes — with less certainty, perhaps[1] — for the Lender of Collateral that is has received by title transfer. So it would be interesting to contrast this with the equivalent provision in the 2018 Pledge GMSLA, wouldn’t it.
Let’s therefore go and do that. Back in a minute.
Back! Sure enough, paragraph 4.3 of the 2018 Pledge GMSLA doesn’t mention Collateral, since it is never title transferred to the Lender in the first place.
See also
- Paragraph 4.3 (Deliveries of Income) of the 2018 Pledge GMSLA
References
- ↑ The Lender isn’t acquiring the Collateral with the express purpose of selling it, although it does acquire it by title transfer and absolutely is entitled to sell it.