Template:CSA transfer timing: Difference between revisions
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===How the business days work for demands under a {{ | ===How the business days work for demands under a {{csa}}=== | ||
This should give you an insight into why lawyers find ISDA documentation so compelling. | This should give you an insight into why lawyers find ISDA documentation so compelling. | ||
*A {{csaprov|Transferee}} may demand a {{csaprov|Delivery Amount (VM)}} (Para {{csaprov|2(a)}}) or a {{csaprov|Return Amount (VM)}} Para {{csaprov|2(b)}}) “on or promptly following a {{csaprov|Valuation Date}}”. | *A {{csaprov|Transferee}} may demand a {{csaprov|Delivery Amount (VM)}} (Para {{csaprov|2(a)}}) or a {{csaprov|Return Amount (VM)}} Para {{csaprov|2(b)}}) “on or promptly following a {{csaprov|Valuation Date}}”. | ||
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:*Tip: the fewer you specifiy, the more likelihood you will be excused from a margin call, so don’t overdo it. One should be ample. | :*Tip: the fewer you specifiy, the more likelihood you will be excused from a margin call, so don’t overdo it. One should be ample. | ||
*Any {{csaprov|Delivery Amount (VM)}} or {{csaprov|Return Amount (VM)}} must be made (Para {{csaprov|3(a)}}) by the [[close of business]] on the {{csaprov|Regular Settlement Day}} relating to the date such demand is received (if received before the {{csaprov|Notification Time}} (spoiler - usually 11 am, noon or 1pm)), or the {{csaprov|Regular Settlement Day}} relating to the day after the date such demand is received (if received after the {{csaprov|Notification Time}}). | *Any {{csaprov|Delivery Amount (VM)}} or {{csaprov|Return Amount (VM)}} must be made (Para {{csaprov|3(a)}}) by the [[close of business]] on the {{csaprov|Regular Settlement Day}} relating to the date such demand is received (if received before the {{csaprov|Notification Time}} (spoiler - usually 11 am, noon or 1pm)), or the {{csaprov|Regular Settlement Day}} relating to the day after the date such demand is received (if received after the {{csaprov|Notification Time}}). | ||
*A “{{csaprov|Regular Settlement Day}}” means the same {{csaprov|Local Business Day}} — careful: as defined in the {{ | *A “{{csaprov|Regular Settlement Day}}” means the same {{csaprov|Local Business Day}} — careful: as defined in the {{csa}} — on which the demand is made | ||
*A “{{csaprov|Local Business Day}}” (under the {{ | *A “{{csaprov|Local Business Day}}” (under the {{csa}}) means, in the case of notices, a day on which banks are open in the address for the notice most recently specified by the Recipient. | ||
*what if demand is made on a day that is not a {{csaprov|Local Business Day}}? Simple: by dint of Section {{isdaprov|12}} of the {{isdama}}, the notice will be deemed given on the next {{isdaprov|Local Business Day}} (as defined in the {{isdama}}}, not the {{ | *what if demand is made on a day that is not a {{csaprov|Local Business Day}}? Simple: by dint of Section {{isdaprov|12}} of the {{isdama}}, the notice will be deemed given on the next {{isdaprov|Local Business Day}} (as defined in the {{isdama}}}, not the {{csa}}). | ||
''Easy''.<br> | ''Easy''.<br> | ||
Revision as of 13:16, 17 October 2017
How the business days work for demands under a 1995 CSA
This should give you an insight into why lawyers find ISDA documentation so compelling.
- A Transferee may demand a Delivery Amount (VM) (Para 2(a)) or a Return Amount (VM) Para 2(b)) “on or promptly following a Valuation Date”.
- A “Valuation Date” means a day on which banks are open in at least one Valuation Date Location for each party.
- Each party can specify whatever Valuation Date Locations it likes.
- Tip: the fewer you specifiy, the more likelihood you will be excused from a margin call, so don’t overdo it. One should be ample.
- Any Delivery Amount (VM) or Return Amount (VM) must be made (Para 3(a)) by the close of business on the Regular Settlement Day relating to the date such demand is received (if received before the Notification Time (spoiler - usually 11 am, noon or 1pm)), or the Regular Settlement Day relating to the day after the date such demand is received (if received after the Notification Time).
- A “Regular Settlement Day” means the same Local Business Day — careful: as defined in the 1995 CSA — on which the demand is made
- A “Local Business Day” (under the 1995 CSA) means, in the case of notices, a day on which banks are open in the address for the notice most recently specified by the Recipient.
- what if demand is made on a day that is not a Local Business Day? Simple: by dint of Section 12 of the ISDA Master Agreement, the notice will be deemed given on the next Local Business Day (as defined in the ISDA Master Agreement}, not the 1995 CSA).
Easy.