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Template:Isda Automatic Early Termination summ: Difference between revisions
Template:Isda Automatic Early Termination summ (view source)
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Amwelladmin (talk | contribs) (Created page with "{{{{{1}}}|Automatic Early Termination}} is an odd and misunderstood concept which exists in Section {{{{{1}}}|6(a)}} {{{{{1}}}|Right to Terminate Following Event of Default}} of the {{isdama}}. As is so much in the {{isdama}}, it’s all about '''Netting'''. Where a jurisdiction suspends terms of contracts in a period of formal insolvency, the idea is to have the ISDA break before that suspension kicks in — so close-out netting works. {{{{{1}}}|AET}} is thus only...") |
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{{{{{1}}}|Automatic Early Termination}} is an odd and misunderstood concept which exists in Section {{{{{1}}}|6(a)}} {{{{{1}}}|Right to Terminate Following Event of Default}} of the {{isdama}}. As is so much in the {{isdama}}, it’s all about '''[[ | {{{{{1}}}|Automatic Early Termination}} is an odd and misunderstood concept which exists in Section {{{{{1}}}|6(a)}} {{{{{1}}}|Right to Terminate Following Event of Default}} of the {{isdama}}. As is so much in the {{isdama}}, it’s all about '''[[close-out netting]]''' as it is about credit protection per se. Where a jurisdiction suspends terms of contracts in a period of formal insolvency, the idea is to have the ISDA break before that suspension kicks in — so close-out netting works. | ||
{{{{{1}}}|AET}} is thus only triggered by ''certain'' events under the {{{{{1}}}|Bankruptcy}} [[Events of Default - ISDA Provision|event of default]] — formal bankruptcy procedures — and not by economic events that tend to indicate insolvency (such as an inability to pay debts as they fall due, [[technical insolvency]] or the exercise of security. Nor does it apply to other Events of Default. | {{{{{1}}}|AET}} is thus only triggered by ''certain'' events under the {{{{{1}}}|Bankruptcy}} [[Events of Default - ISDA Provision|event of default]] — formal bankruptcy procedures — and not by economic events that tend to indicate insolvency (such as an inability to pay debts as they fall due, [[technical insolvency]] or the exercise of security. Nor does it apply to other Events of Default. | ||