83,229
edits
Template:Dust capsule: Difference between revisions
Jump to navigation
Jump to search
no edit summary
Amwelladmin (talk | contribs) No edit summary |
Amwelladmin (talk | contribs) No edit summary |
||
| Line 1: | Line 1: | ||
{{ | {{{{{1}}}|Default Under Specified Transaction}} — colloquially, “{{{{{1}}}|DUST}}” — is often confused with {{{{{1}}}|Cross Default}}. In fact, they’re ''meant'' to be mutually exclusive. That won’t stop folks conflating them, though. Look, we all do it. | ||
{{ | {{{{{1}}}|DUST}} is ''like'' {{{{{1}}}|Cross Default}}, but where {{{{{1}}}|Cross Default}} references indebtedness owed to third parties, {{{{{1}}}|DUST}} is all about ''non''-“borrowing” style transactions — e.g., [[swap|swap agreements]], [[stock loan]]s<ref>I know these ''sound'' like borrowing transactions, but they’re fully collateralised, and in fact aren’t.</ref> and [[repo]]s, '''but only transactions between the two counterparties'''<ref>And — sigh — their {{{{{1}}}|Credit Support Provider}}s and {{{{{1}}}|Specified Entities}}.</ref>. | ||
If a [[Counterparty]]<ref>Or — sigh — its {{ | If a [[Counterparty]]<ref>Or — sigh — its {{{{{1}}}|Credit Support Provider}} or {{{{{1}}}|Specified Entity}}</ref> experiences an {{{{{1}}}|Event of Default}} under a [[swap]] agreement (or other “{{{{{1}}}|Specified Transaction}}”<ref>This is typically wide, though it excludes [[borrowed money]] — but check the Agreement!</ref> with you, this will be an {{{{{1}}}|Event of Default}} under the {{isdama}}. | ||