Template:Csa Rights and Remedies summ

{{Csa Rights and Remedies summ {{{1}}}|{{{1}}}}}

Deficiencies and Excess Proceeds

All versions do the same thing: Once the security has been exercised, proceeds realised and the outstanding amount due settled, the {{{{{1}}}|Secured Party}} must return any excess of the realised proceeds to the posting party, and if there is a shortfall after the security has been realised and applied against the debt, the posting party remains liable for it. This is all good standard security-taking stuff.

Final Returns

All versions get to more or less the same place: Once all {{{{{1}}}|Obligation}}s are fully settled (with an exception for Taxes — we suppose because they could be imposed retrospectively, so it’s impossible to discharge them definitively — the {{{{{1}}}|Secured Party}} has to give the {{{{{1}}}|Posted Credit Support}} back.

This ought to happen automatically where we are talking about variation margin — Q.E.D., if your {{{{{1}}}|Obligation}}s are all settled you have no {{{{{1}}}|Exposure}} so your counterparty has no grounds to hold {{{{{1}}}|Posted Credit Support}} — but for {{{{{1}}}|Independent Amount}}s or initial margin posted under an 2018 English law IM CSD, this is not necessarily the case: the CSA itself might specify an independent {{{{{1}}}|Independent Amount}} that is not conditional on any {{{{{1}}}|Transaction}}. (This is not how most dealers handle initial margin on their swaps — it tends to be {{{{{1}}}|Transaction}}-specific — but this is how the original CSAs were conceived at the time of the First Men.)