Template:Csa transaction versus credit support document: Difference between revisions

Unlike a [[title transfer]] {{ukcsa}}, the {{nyvmcsa}} is ''not'' a Transaction under the {{isdama}}, but is in fact a {{isdaprov|Credit Support Document}}: a standalone [[collateral]] arrangement that stands aloof and apart from the {{isdama}} and all its little diabolical {{isdaprov|Transaction}}s, and the reason for ''that'' is — and, spoiler: it’s not a very good one — because while a {{ukcsa}}, by being a {{ttca}}, reverses the [[indebtedness]] claim outright, an {{nyvmcsa}} (and, for that matter, an English law Credit Support Deed) does not: it only provides a [[security interest]]. The [[in-the-money]] counterparty is still [[in-the-money]]. It is just ''secured'' for that [[exposure]]. The outright exposure between the parties does not change.

This is deep, magical, bamboozling stuff and, at least where [[rehypoethcation]] is allowed under Paragraph {{nyvmcsaprov|9(c)}} of a {{nyvmcsa}} — it pretty much always is — serves no real pupose at all, because even though you ''say'' you are only pledging the agreement, in the the greasy light of commercial reality, you ''are'' transferring title outright.