Failure to Pay, DUST and Cross Default under the ISDA

For those who think it is useful to understand the interaction between Failure to Pay, DUST and Cross Default.

• FTP covers payment under delivery defaults directly under the ISDA Master Agreement
• DUST covers trades under other master trading agreements (and distinct ISDA Master Agreements — unlikely, but not impossible) between the same two parties
• Cross Default covers Specified Indebtedness (unless you’re odd, that means borrowed money) between the counterparty and any third party.