Template:Csa Events of Default summ: Difference between revisions
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Which is nice. This is not a problem for the English law Credit Support Annexes that are {{isdaprov|Transactions}}. | Which is nice. This is not a problem for the English law Credit Support Annexes that are {{isdaprov|Transactions}}. | ||
{{csa Default under title transfer CSAs {{{1}}}|{{{1}}}}} | {{csa Default under title transfer CSAs {{{1}}}|{{{1}}}}} | ||
=====Including “comprehensive” Termination Events===== | =====Including “comprehensive” Termination Events===== | ||
Consider expanding of the {{{{{1}}}|Default}} provision to include “{{isdaprov|Termination Event}}s where all {{isdaprov|Transactions}} are {{isdaprov|Affected Transaction}}s”. This is as per Section 3.2 of the 2001 ISDA Margin Provisions which recommend that Paragraph {{{{{1}}}|6}} of the {{tag|CSA}} should apply where all {{isdaprov|Transactions}} are closed out following an {{isdaprov|Event of Default}} or “{{{{{1}}}|Specified Condition}}” — the latter of which is defined to include the {{isdaprov|Termination Events}} listed under the {{isdama}}. All {{isdaprov|Transaction}}s would likely be {{isdaprov|Affected Transactions}} should a {{isdaprov|Credit Event Upon Merger}} or {{isdaprov|Additional Termination Event}} occur. | Consider expanding of the {{{{{1}}}|Default}} provision to include “{{isdaprov|Termination Event}}s where all {{isdaprov|Transactions}} are {{isdaprov|Affected Transaction}}s”. This is as per Section 3.2 of the 2001 ISDA Margin Provisions which recommend that Paragraph {{{{{1}}}|6}} of the {{tag|CSA}} should apply where all {{isdaprov|Transactions}} are closed out following an {{isdaprov|Event of Default}} or “{{{{{1}}}|Specified Condition}}” — the latter of which is defined to include the {{isdaprov|Termination Events}} listed under the {{isdama}}. All {{isdaprov|Transaction}}s would likely be {{isdaprov|Affected Transactions}} should a {{isdaprov|Credit Event Upon Merger}} or {{isdaprov|Additional Termination Event}} occur. | ||
Revision as of 13:43, 9 May 2024
Grace periods
Those of ISDA credit support arrangements that are standalone Credit Support Documents — the 1994 NY CSA, 2016 NY Law VM CSA and the 2018 English law IM CSD, but not the 1995 CSA and the 2016 VM CSA — bake in their own two {{{{{1}}}|Local Business Day}} grace period into their own customised Events of Default.
The 1995 CSA and 2016 VM CSA, being Transactions, don’t need to and inherit the grace periods for the Events of Default in the ISDA Master Agreement.
That can, at the limit, create a dissonance for Americans and IM posters, as your CSA grace periods do not automatically track your ISDA ones. Two {{{{{1}}}|Local Business Day}}s is an LBD longer than the standard one LBD grace period in the 2002 ISDA, and an LBD shorter than the standard 3 LBD grace period baked into the 1992 ISDA.
Which is nice. This is not a problem for the English law Credit Support Annexes that are Transactions. {{csa Default under title transfer CSAs {{{1}}}|{{{1}}}}}
Including “comprehensive” Termination Events
Consider expanding of the {{{{{1}}}|Default}} provision to include “Termination Events where all Transactions are Affected Transactions”. This is as per Section 3.2 of the 2001 ISDA Margin Provisions which recommend that Paragraph {{{{{1}}}|6}} of the CSA should apply where all Transactions are closed out following an Event of Default or “{{{{{1}}}|Specified Condition}}” — the latter of which is defined to include the Termination Events listed under the ISDA Master Agreement. All Transactions would likely be Affected Transactions should a Credit Event Upon Merger or Additional Termination Event occur.