A “haircut” is a reduction which is applied to the value of an asset.  Typically, “haircuts” are expressed as a percentage.  For example, if a “haircut” of 5% were applied to bonds worth GBP 100, it would mean that the bonds would be treated as if they were only worth GBP 95 for the purposes […]

The “GMRA” (pronounced “JIMRA”) is short-hand for the “Global Master Repurchase Agreement”.  This is the primary industry standard document under which transactions called “Repurchase Transactions” (or “Repos” for short) and “Buy/Sell Backs” are transacted. There are actually four versions of the GMRA.  The first was published in 1992, followed by a second version in 1995.  […]

The “Global Master Repurchase Agreement” (or “GMRA” for short) is the industry standard contract for transacting Repurchase Transactions.  It is published by the International Capital Market Association (ICMA).  There have been four versions of the Global Master Repurchase Agreement – the first published in 1992.  The GMRA was subsequently updated in 1995 in order to […]

The concept of a “Forward Repricing Date” relates to “Forward Transactions” entered into under a GMRA. The “Forward Repricing Date” with respect to any Forward Transaction is the date which is such number of Business Days before the Purchase Date as is equal to the minimum period for the delivery of margin applicable under paragraph […]

The definition of “Electronic Messaging System” (which is found in paragraph 2(s) of the 2011 Global Master Repurchase Agreement) refers to “an electronic system for communication capable of reproducing communication in hard copy form”.  Perhaps the most interesting aspect of the definition is that it expressly INCLUDES communications sent via email.  Any communication required to […]

The concept of an “Act of Insolvency” is relevant for the purposes of the Events of Default under the Global Master Repurchase Agreement.  More specifically, an Event of Default arises under Paragraph 10(a)(vi) of the 2011 GMRA if an “Act of Insolvency” occurs with respect to either the Seller or the Buyer.  In addition, if […]

The concept of the “Early Termination Date” was first introduced into the 2011 GMRA.  Following the occurrence of an Event of Default, the non-Defaulting Party designates an “Early Termination Date” within its “Default Notice” (Automatic Early Termination can also apply).  In essence, this has been designed to ensure that the close-out mechanics of the 2011 […]

“Distributions” are payments that are made with respect to securities.  They can include interest, dividends and repayment of principal amounts.  Obviously, the “Distributions” are paid to the party which owns the securities at the time that the relevant payment is made. “Distributions” are most relevant to the “Income” provisions of the GMRA under which, broadly, […]

Paragraph 1(a) of the Global Master Repurchase Agreement states that parties may enter into transactions through their “Designated Offices”.  There is no real definition of “Designated Office” within the GMRA.  Both the Buyer and the Seller simply specify their “Designated Office(s)” within Part 1(f) of Annex I to the 2011 GMRA (Part 1(e) to Annex […]