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| {{gmslasnap|5.5}}
| | #redirect[[Marking to Market of Collateral during the currency of a Loan on a Loan by Loan basis - GMSLA Provision]] |
| {{nuts|GMSLA|5.5}}
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| ====Commentary====
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| See also {{gmslaprov|5.4}}, Collateralisation on aggregate, which will generally be the preferred alternative for most financial institutions.
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| ====Summary====
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| In an {{nutshell}}:
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| {{box|
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| Where {{gmslaprov|5.5}} applies, the {{gmslaprov|Posted Collateral}} in respect of any {{gmslaprov|Loan}} bears the same proportion to the {{gmslaprov|Market Value}} of the {{gmslaprov|Loaned Securities}} as the {{gmslaprov|Posted Collateral}} bore at the commencement of the {{gmslaprov|Loan}}. Accordingly: <br>
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| :(a) the {{gmslaprov|Market Value}} of the {{gmslaprov|Posted Collateral}} must always equal the {{gmslaprov|Required Collateral Value}}; <br>
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| :(b) whenever the {{gmslaprov|Market Value}} of the {{gmslaprov|Posted Collateral}} for any {{gmslaprov|Loan}} (including unpaid amounts and unpaid {{gmslaprov|Income}} on {{gmslaprov|Non-Cash Collateral}}) exceeds the {{gmslaprov|Required Collateral Value}} under the {{gmslaprov|Loan}} (including all amounts due by the {{gmslaprov|Borrower}} and <br>
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| ::(ii) any {{gmslaprov|Income}} payable in respect of {{gmslaprov|Equivalent Securities}},<br>
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| :{{gmslaprov|Lender}} shall repay to {{gmslaprov|Borrower}} such Equivalent Collateral to eliminate the excess; and <br>
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| :(c) whenever the {{gmslaprov|Market Value}} of the {{gmslaprov|Posted Collateral}} together with: <br>
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| ::(i) all amounts due by the Lender under the Loan; and <br>
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| ::(ii) any {{gmslaprov|Income}} payable on {{gmslaprov|Non-Cash Collateral}} <br>
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| :falls below the {{gmslaprov|Required Collateral Value}} together with: <br>
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| ::(i) all amounts due by the {{gmslaprov|Borrower}} under the {{gmslaprov|Loan}}; and <br>
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| ::(ii) any {{gmslaprov|Income}} payable under the {{gmslaprov|Equivalent Securities}}, {{gmslaprov|Borrower}} shall (on demand) provide further {{gmslaprov|Collateral}} to {{gmslaprov|Lender}} to eliminate the deficiency.<br>
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| }}
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| ====See Also====
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| {{gmslaanatomy}}
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