GMSLA Netting: Difference between revisions

''See also'':  

*{{gmslaprov|Mini close-out}}

Closing out a {{gmsla}} is done following designation by a {{gmslaprov|Non-Defaulting Party}} of an {{gmslaprov|Event of Default}} under Paragraph {{gmslaprov|11.2}} as follows:  

===Gross Jurisdictions===

Upon the [[insolvency]] of a Counterparty in a [[non-netting jurisdiction]], provided a {{gmslaprov|Non-Defaulting Party}} terminates each {{gmslaprov|Loan}} individually under the "[[mini-closeout]]” method before it designates an {{gmslaprov|Event of Default}} with respect to the whole {{gmslaprov|Agreement}},  the worst-case scenario is to aggregate the market value of each “{{gmslaprov|Loan}}” which is in the money to the {{gmslaprov|Non-Defaulting Party}} (i.e., its net value having taken into account {{gmslaprov|Posted Collateral}} held against that {{gmslaprov|Loan}}), without taking into account the market value of any {{gmslaprov|Loan}} which is [[out of the money]] for the {{gmslaprov|Non Defaulting Party}}.