Template:Csa Conditions Precedent summ

Another flawed asset clause?

Aren’t the Conditions precedent dealt with in Section 2(a)(iii) of the ISDA?

Well, they are — if your credit support annex counts as a Transaction under the ISDA, which the title transfer CSAs do (eg, the English law 1995 CSA and the 2016 VM CSA), but the security interest CSAs (the New York law 1994 NY CSA and 2016 NY VM CSA and the English law 2018 IM CSD) do not.

Not entirely clear that it should relate to ineligible Credit Support (that hence has a Value of zero), since it doesn’t count numerically into the Value of the Posted Credit Support (IM) (this is the 2018 English law IM CSD’s ungainly description of what we used to call a “Credit Support Balance” — but on the other hand the argument is “well, you are going tetas arriba so frankly anything of yours that I hold I’m damn well keeping and selling for anything I can get for it.”

The latter argument, we fancy, will prevail.