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Template:M summ 2002 ISDA Unpaid Amounts: Difference between revisions
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Template:M summ 2002 ISDA Unpaid Amounts (view source)
Revision as of 10:57, 24 May 2021
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Amwelladmin (talk | contribs) (Created page with "You may want to know where {{isdaprov|Unpaid Amounts}} feature in the {{isdama}}. The answer: In {{isdaprov|Payments on Early Termination}}: Section {{isdaprov|6(e)(i)}} (for...") |
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If you think of an ISDA transaction as comprising offsetting payment streams, these fall into one of three places: | |||
*'''Been and gone''': Already paid: settled, gone, checked into the hereafter; on permanent location in that foreign country we call the past; | |||
*'''Yet to come''': Due to be paid, or delivered, at a specified date in the future. Perhaps fixed; perhaps yet to be determined, but conceptually still out there. It is, conventionally, by off setting the provisional present value of these future cashflows, that we value “the {{isdaprov|Transaction}}” — this is what we call its “[[Replacement Transaction - ISDA Provision|replacement cost]]”. | |||
*That weird inter-regnum of payments whose due date has passed, and who ''should have'' emigrated to that foreign country but, for whatever reason — either through inattention, inability, defiance, or the affordances of Section {{isdaprov|2(a)(iii)}} — they have not yet been made, so they need to be accounted for over and above the “replacement” value of the trade. | |||
They are of interest in two cases: Default — clearly a significant possibility where a party is not meetings it oblighations as they fall due; and when taking credit support under the CSA, because they are of interest in calculating ones {{vmcsaprov|Exposure}}. | |||
You may want to know where {{isdaprov|Unpaid Amounts}} feature in the {{isdama}}. The answer: In {{isdaprov|Payments on Early Termination}}: Section {{isdaprov|6(e)(i)}} (for {{isdaprov|Events of Default}}) and {{isdaprov|6(e)(ii)}} (for {{isdaprov|Termination Events}}) and {{isdaprov|6(e)(iv)}} ({{isdaprov|Adjustment for Illegality or Force Majeure Event}}). | You may want to know where {{isdaprov|Unpaid Amounts}} feature in the {{isdama}}. The answer: In {{isdaprov|Payments on Early Termination}}: Section {{isdaprov|6(e)(i)}} (for {{isdaprov|Events of Default}}) and {{isdaprov|6(e)(ii)}} (for {{isdaprov|Termination Events}}) and {{isdaprov|6(e)(iv)}} ({{isdaprov|Adjustment for Illegality or Force Majeure Event}}). | ||