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Hazell v Hammersmith and Fulham LBC: Difference between revisions
Hazell v Hammersmith and Fulham LBC (view source)
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*'''Purely speculative'''. These banks conceded that these were unlawful. | *'''Purely speculative'''. These banks conceded that these were unlawful. | ||
*“'''Parallel contracts'''”: Those relating to existing loan designed to capitalise upon changes in interest rates. These were also speculative in nature, but did relate to an existing loan exposure of the local authority, which Lord Templeman called | *“'''Parallel contracts'''”: Those relating to existing loan designed to capitalise upon changes in interest rates. These were also speculative in nature, but did relate to an existing loan exposure of the local authority, which Lord Templeman called “parallel contracts” or “replacing” interest rates. Here “the swap transaction is a speculation no different in quality although different in magnitude from a swap contract which is not entered into by reference to any existing borrowing”. | ||
*“'''Re-profiling'''”: Swaps relating to an existing loan, intended to alter the proportion of the interest which was paid on either a fixed or variable basis. Lord Templeman thought these were largely indistinguishable from parallel contracts. | *“'''Re-profiling'''”: Swaps relating to an existing loan, intended to alter the proportion of the interest which was paid on either a fixed or variable basis. Lord Templeman thought these were largely indistinguishable from parallel contracts. | ||