Template:M gen 2016 CSA 1(b)

Weird exclusion alert

What is with that exception at the end? Somehow initial margin for Covered Transactions under this 2016 VM CSA might be documented under some Other CSA, when you have just gone to tedious lengths to exclude it from having any impact on this 2016 VM CSA?

At first, the JC thought this might be a typo in his transcription of the 2016 VM CSA — he’s never claimed to be a details guy — so was a critical “not” missing? A cursory google suggests no such error on his part. So could this have somehow been missed by even the crowd-wise pedants of ISDA’s crack drafting squad™?

Again, no. Our best guess is that this is deliberate. Why? Because the 2016 VM CSA has no provision at all to deal with initial margin. It being assumed one has put a 2016 VM CSA in place only reluctantly, under protest because the meddling regulator told you to, and that you already had a 1995 CSA which you were happy with, which did have some initial margin provisions. So, since your shiny new 2016 VM CSA has nothing to say about initial margin you continue to levy this under the existing Other CSA.