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Template:M summ Pledge GMSLA 28.1: Difference between revisions
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[[28.1 - Pledge GMSLA Provision|As]] well as the general objections to this feebly drafted provision (as to which, see below) we have another one: if the counterparties to this pledge-style agreement are already counterparties to an existing 2010 GMSLA — the one where collateral flows by [[title transfer]] — then glibly asserting that the old agreement has been superseded does not work — the collateral arrangements are utterly different operationally as well as legally — and is not likely to be the parties’ intention. | |||
The Pledge GMSLA exists to cater for the [[agent lending]] universe, where are securities lenders are happy for their collateral to be delivered into a tri party system where it is “dead-ended”, and where are collateral lenders are generally represented by an agent who has entered into a master agency lending agreement. | |||
The agent will have a separate mandate with each of its [[principal]]s, and those who who gave their mandate before the the pledge gmsla play was created will not have contemplated accept and collateral by pledge and not title transfer. Therefore the process of switching clients over from the title transfer version to the pledge version is a careful one which will be accompanied by explicit documentation (such as an updated “Annex A” of covered principals). It is not beyond the realms of possibility (though hard to think of one) that a principle may wish to have some of its loans collateralized by title transfer and others by pledge. | |||
Therefore we think that if if parties wanted to automatically hoover up existing all title transfer arrangements and replace them outright with a new pledge agreement, they would say so quite a bit more clearly than this. | |||
{{sla 27.1 summ|pgmslaprov}} | {{sla 27.1 summ|pgmslaprov}} | ||