Cash - NY CSA Provision

1994 ISDA Credit Support Annex (New York law) A Jolly Contrarian owner’s manual™ Cash in a Nutshell™ The JC’s Nutshell™ summary of this term has moved uptown to the subscription-only ninja tier. For the cost of ½ a weekly 🍺 you can get it here. Sign up at Substack. Cash in all its glory “Cash” means the lawful currency of the United States of America. edit Resources and Navigation Resources Wikitext | Nutshell wikitext Navigation 1 (Interpretation) | 2 (Security Interest) | 3 (Credit Support Obligations) | 4 ( Conditions Precedent, Transfer Timing, Calculations and Substitutions) | 5 (Dispute Resolution) | 6 (Holding and Using Posted Collateral (VM)) | 7 (Events of Default) | 8 (Certain Rights and Remedies) | 9 (Representations) | 10 (Expenses) | 11 (Miscellaneous) | 12 (Definitions) | 13 (Elections and Variables Index: Click ᐅ to expand: Category NY CSA not found Premium version of this page

Overview

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The defintion of that folding currency with the odd little pyramid with the eye on the back of it. Note: in the more international-looking versions of the CSA, including later versions of the New York Law CSA, the currency basket is a lot wider.

Summary

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Lawful currency for the time being...

You have to love, don’t you, the preparedness of ISDA’s crack drafting squad™ to contemplate a world in which the lawful currency of the United States might not be the U.S. dollar, given how sacred the U. S. dollar is to our American friends. This from a place that haven’t changed the fundamental look of the even construction of the dollar bill since it was last designed in 1935.

(That’s when they put the pyramid with the all-seeing eye on it. Nothing to see here, folks.)

Internationality (or not) of NY law CSAs

Now one tres interessant difference between the New York law 1994 NY CSA and the English law 1995 CSA is that the American version only contemplates a single currency. Because there is only one currency right?

This is what it is — to the extent the constituency trading on a NY CSA are US counterparties that will generally be what they want, and even for those who aren’t, that will generally be what they want, or at least are prepared to put up with, but note it in any case. If you are a counterparty who funds in another currency, you might thing about using the 2016 NY VM CSA, which does contemplate multiple currencies — but doesn’t contemplate IM, should you be someone who wants to take non-regulatory initial margin.

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• The JC’s famous Nutshell™ summary of this clause

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See also

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• Cash - NY VM CSA Provision
• Cash generally