Template:Csa Delivery Amount comp: Difference between revisions
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Now the interesting thing here is the difference that ''[[pledge|pledged]]'' collateral under the | Now the interesting thing here is the difference that ''[[pledge|pledged]]'' collateral under the New York law versions of the CSA makes over ''[[Title transfer|title-transferred]]'' collateral regime of the English law versions. You will see the difference in the NY law version’s {{{{{1}}}|Delivery Amount}}, which is the positive difference between Secured Party’s {{{{{1}}}|Exposure}} and the value of Posted Credit Support ''held by the Secured Party'' — easy, right? — and the equivalent provision in the English law versions which is the positive difference between the {{{{{1}}}|Transferee}}’s {{{{{1}}}|Exposure}} and the {{{{{1}}}|Credit Support}} ''adjusted to exclude any inflight but unsettled collateral movements''. | ||
The | The English law versions are a bit more leaden in how they describe things but these amount to the same thing: you don’t get any credit (support) for collateral ''until it has landed with the other party''. | ||
This creates some curious scenarios, as you will see. | |||
Latest revision as of 11:35, 13 May 2024
Now the interesting thing here is the difference that pledged collateral under the New York law versions of the CSA makes over title-transferred collateral regime of the English law versions. You will see the difference in the NY law version’s {{{{{1}}}|Delivery Amount}}, which is the positive difference between Secured Party’s {{{{{1}}}|Exposure}} and the value of Posted Credit Support held by the Secured Party — easy, right? — and the equivalent provision in the English law versions which is the positive difference between the {{{{{1}}}|Transferee}}’s {{{{{1}}}|Exposure}} and the {{{{{1}}}|Credit Support}} adjusted to exclude any inflight but unsettled collateral movements.
The English law versions are a bit more leaden in how they describe things but these amount to the same thing: you don’t get any credit (support) for collateral until it has landed with the other party.
This creates some curious scenarios, as you will see.