Nominee - Pledge GMSLA Provision

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2018 Global Master Securities Lending Agreement (Pledge Version)
A Jolly Contrarian owner’s manual™

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GMSLA

Clause Nominee in a Nutshell
Use at your own risk, campers!

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Full text of Clause Nominee

Nominee means a Nominee or agent appointed by either Party to accept Delivery of, hold or deliver Securities, Equivalent Securities and/or Collateral or to receive or make payments on its behalf;
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Related agreements and comparisons

Related agreements: Click here for the same clause in the 2010 GMSLA
Comparison: There is no equivalent provision in the other version of the GMSLA.

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Content and comparisons

There is no such provision in the 2010 GMSLA! This is unique and special to the 2018 Pledge GMSLA. Just what it is driving at, on the other hand, is not so easy to divine.

The reference (in the pledge version only) to a Nominee, may be to recognise that the 2018 Pledge GMSLA is typically suitable only for agency lending arrangements, in which the principal Lenders to the Loans will be wealth-management clients and funds whose assets are managed by an agent lender, who in turn has put the whole business in the hands of a triparty agent, who will manage the collateral flows, pledges and all that good oil.

Though why they didn’t say “tri-party agent”, it is hard to say, since “nominee” has, in other custody contexts, a rather different meaning. And there is nothing to stop folks using a tri-party arrangement with a normal 2010 GMSLA either, for that matter, and it has routinely been done for as long as anyone can remember.
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Summary

Now had ISLA’s crack drafting squad™ taken the dramatic step of writing “nominee” in lower case in Paragraph 1.3, or better still, didn’t put in a Paragraph 1.3 at all — since it is an “I never said you couldn’t” sort of a provision.
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General discussion

You may be wondering in what context the idea of a Nominee arises in the 2010 GMSLA. Joyously, only in this one: Clause 1.3 generously allows that either party may perform its obligations through a nominee:

1.3 Either Party may perform its obligations under this Agreement either directly or through a Nominee.

Worth waiting for, wasn’t it. Especially when you consider that permissive statements of this kind really go without saying: “I never said you couldn’t

Look, I didn’t write this stuff, folks.
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See also

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References