Template:Isda Credit Support Provider summ: Difference between revisions
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A | A {{{{{1}}}|Credit Support Provider}} is basically a [[guarantor]]: a third party who stands being the obligations of a counterparty to the {{isdama}}. Usually this is someone providing an all obligations guarantee or a standby letter of credit, but on rare occasions — very rare, usually involving [[espievie]]s — might be a third party directly posting credit support to the other party under a Credit Support Document. In any case it is not a direct counterparty to the {{isdama}} itself, whether or not the CSA counts as a {{isdaprov|Credit Support Document}}. | ||
Given that a {{csa}} is not a {{{{{1}}}|Credit Support Document}} at all, but a {{{{{1}}}|Transaction}} under the {{isdama}}, a party to it is obviously not a Credit Support Provider. | |||
A {{nycsa}}, on the other hand, ''is'' a {{{{{1}}}|Credit Support Document}} though. So should a Party to the {{isdama}}, where there is a {{nycsa}}, be described as a “{{{{{1}}}|Credit Support Provider}}"? | |||
''No'', sayeth the User’s Guide to the {{1994csa}}: | |||
{{quote|“Parties to an {{isdama}} should not, however, be identified as {{{{{1}}}|Credit Support Provider}}s with respect to the Annex, ''as such term is intended only to apply to third parties''.”}} | |||
the Users’ Guide to the {{2002ma}} is similarly emphatically vague: | |||
{{quote|“The meaning of “{{{{{1}}}|Credit Support Provider}}” ... should apply to any person or entity (''other than either party'') providing, or a party to, a {{{{{1}}}|Credit Support Document}} delivered on behalf of a particular party.”}} | |||
This means that a New York Law CSA — which is not a {{{{{1}}} | |||
|Transaction}} under the ISDA architecture, remember, ''is'' a {{{{{1}}}|Credit Support Document}}, but the person providing {{{{{1}}}|Credit Support}} under it — is ''not'' a “{{{{{1}}}|Credit Support Provider}}”? | |||
Latest revision as of 09:10, 8 June 2023
A {{{{{1}}}|Credit Support Provider}} is basically a guarantor: a third party who stands being the obligations of a counterparty to the ISDA Master Agreement. Usually this is someone providing an all obligations guarantee or a standby letter of credit, but on rare occasions — very rare, usually involving espievies — might be a third party directly posting credit support to the other party under a Credit Support Document. In any case it is not a direct counterparty to the ISDA Master Agreement itself, whether or not the CSA counts as a Credit Support Document.
Given that a 1995 CSA is not a {{{{{1}}}|Credit Support Document}} at all, but a {{{{{1}}}|Transaction}} under the ISDA Master Agreement, a party to it is obviously not a Credit Support Provider.
A 1994 NY CSA, on the other hand, is a {{{{{1}}}|Credit Support Document}} though. So should a Party to the ISDA Master Agreement, where there is a 1994 NY CSA, be described as a “{{{{{1}}}|Credit Support Provider}}"?
No, sayeth the User’s Guide to the 1994 NY CSA:
“Parties to an ISDA Master Agreement should not, however, be identified as {{{{{1}}}|Credit Support Provider}}s with respect to the Annex, as such term is intended only to apply to third parties.”
the Users’ Guide to the 2002 ISDA is similarly emphatically vague:
“The meaning of “{{{{{1}}}|Credit Support Provider}}” ... should apply to any person or entity (other than either party) providing, or a party to, a {{{{{1}}}|Credit Support Document}} delivered on behalf of a particular party.”
This means that a New York Law CSA — which is not a {{{{{1}}} |Transaction}} under the ISDA architecture, remember, is a {{{{{1}}}|Credit Support Document}}, but the person providing {{{{{1}}}|Credit Support}} under it — is not a “{{{{{1}}}|Credit Support Provider}}”?