Delivery of Letters of Credit - GMSLA Provision

2010 Global Master Securities Lending Agreement A Jolly Contrarian owner’s manual™ Resources and navigation 2010 GMSLA: Full wikitext · Nutshell wikitext | GMLSA legal code | GMSLA Netting Pledge GMSLA: Hard copy (ISLA) · Full wikitext · Nutshell wikitext | 1995 OSLA: OSLA wikitext | OSLA in a nutshell | GMSLA/PGMSLA/OSLA clause comparison table From Our Friends On The Internet: Guide to equity finance | ISLA’s guide to securities lending for regulators and policy makers Navigation 2010 GMSLA 1 · 2 · 3 · 4 · 5 · 6 · 7 · 8 · 9 · 10 · 11 · 12 · 13 · 14 · 15 · 16 · 17 · 18 · 19 · 20 · 21 · 22 · 23 · 24 · 25 · 26 · 27 · Schedule · Agency Annex · Addendum for Pooled Principal Agency Loans 2018 Pledge GMSLA 1 · 2 · 3 · 4 · 5 · 6 · 7 · 8 · 9 · 10 · 11 · 12 · 13 · 14 · 15 · 16 · 17 · 18 · 19 · 20 · 21 · 22 · 23 · 24 · 25 · 26 · 27 · 28 · Schedule · Agency Annex Stock Loan owner’s manuals: 2010 GMSLA · 2000 GMSLA · Pledge GMSLA · OSLA Index: Click ᐅ to expand: GMSLA Pledge GMSLA Clause 8.5 in a Nutshell™ Use at your own risk, campers! 8.5 Delivery of Letters of Credit: Where Collateral takes the form of a Letter of Credit, the Lender can satisfy its obligation to redeliver Equivalent Collateral by delivering the Letter of Credit for cancellation, or consenting to a reduction in its value. view template Full text of Clause 8.5 8.5 Delivery of Letters of Credit Where a Letter of Credit is provided by way of Collateral, the obligation to deliver Equivalent Collateral is satisfied by Lender delivering for cancellation the Letter of Credit so provided, or where the Letter of Credit is provided in respect of more than one Loan, by Lender consenting to a reduction in the value of the Letter of Credit. view template Related agreements and comparisons Related agreements: Click here for the same clause in the 2018 Pledge GMSLA Related agreements: Click here for the same clause in the 1995 OSLA Comparison: Template:Gmsladiff 8.5 Comparison: Template:Osladiff 8.5 Comments? Questions? Suggestions? Requests? Insults? We’d love to 📧 hear from you. Sign up for our newsletter.

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Summary

... and a Letter of Credit is what, exactly?

An old fashioned form of credit support. A bank writes an unconditional letter promising to pay a (usually large) sum on money on demand and without argument to a third party on behalf of a client. This gets small companies a bit of breathing space with trade creditors. Banks charge through the nose for them: they are a form of committed funding.

Lots of formal rules and legal form-obeisance.

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See also

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