This document provides an overview of the EU Directive on Financial Collateral from 2002 from a Turkish point of view. It discusses key definitions in the directive including financial collateral agreements and the types of financial instruments that can be used as collateral. It also summarizes measures taken in the directive such as reducing formal requirements for enforcement, allowing rapid enforcement of collateral, and recognizing title transfer arrangements. Finally, it provides examples of how the directive could improve enforcement of collateral in Turkey by allowing direct sale of financial instruments without court intervention if stipulated in the agreement.
This document discusses different types of collateral security that can be used to secure loans. It defines collateral security as property or other assets offered by a borrower to a lender to secure a loan. If the borrower defaults, the lender can seize the collateral. The document provides examples of acceptable collateral like cash, securities, land, buildings, and personal guarantees. It discusses the advantages and disadvantages of different types of collateral security and how they can help mitigate risk for the lender.
The document provides an overview of the Danish banking law system. It summarizes that Denmark has approximately 80 credit institutions regulated by the Danish Financial Supervisory Authority. The main types are banks, savings banks, and mortgage credit institutions. Danish banking law is codified but operates largely on freedom of contract principles, especially for commercial loans. Key aspects covered include types of loan agreements, security interests like mortgages and pledges, financial assistance restrictions, and applicability of the Rome II and European Insolvency Regulations.
This document defines collateral/security and describes the types of collateral a bank may accept. Tangible collateral includes land, buildings, machinery, vehicles, stocks and inventory. Intangible collateral includes guarantees and deposit accounts. When providing loans, banks require collateral to ensure repayment. The value of the collateral must exceed the loan amount, with the difference called the margin. This margin protects the bank in case the collateral must be seized and sold. The amount a borrower can borrow against a specific collateral is their drawing power. The document also outlines different forms of financing like loans, overdrafts and bill discounting that banks use to provide funds to borrowers.
This document provides an overview of bank guarantees, including:
1) It defines a bank guarantee as a contract where the bank guarantees to perform a third party's liability in case of default. The parties involved are the applicant, beneficiary, and guarantor bank.
2) Common purposes of bank guarantees include providing security deposits, mobilizing funds, and ensuring performance or payment on contracts.
3) Guidelines state banks should exercise caution with performance guarantees and generally limit guarantees to 18 months, taking security such as cash margins from applicants.
4) Proper appraisal of guarantees is required similar to loans, examining the applicant's financial strength and purpose of the guarantee.
Credit Facilities Extended By Bank (Iipm)toocoolnikhil
There are two main forms of bank lending:
1) Fund based lending includes facilities like term loans, cash credits, and overdrafts where money is immediately paid out to the borrower and appears on the bank's balance sheet.
2) Non-fund based lending includes guarantees, letters of credit, and co-acceptances where there is no immediate outflow of funds but the bank is committed to future payment which appears as a contingent liability.
Such loans are given to stock brokers and market makers Banks also grant loans against units of mutual fund. However in this case the amount of advance should be linked to Net Asset Value or market value whichever is less. One of the guidelines to be followed while granting this loan is that banks should satisfy themselves with the marketability of this loan. And banks should not advance against partly paid shares. Banks may determine the rate of interest without referring to Benchmark Prime Lending Rate. Certain prohibitions apply. For instance, banks cannot sanction loans against equity shares of the banking company to its directors. Banks cannot lend to their employees through employee trusts set up by them. Also, a bank’s total exposure including both fund and non fund categories should not exceed 15% of the total advances as of 31 March in the previous year.
Collateral is property pledged as security against a loan. If the loan is not repaid, the lender can seize or sell the collateral to recover funds. Common types of collateral include real estate like homes or buildings, equipment, life insurance policies, personal guarantees, and investment assets. Collateral benefits lenders by reducing investment risk if the borrower defaults on repayment. It also helps borrowers access capital needed to start businesses.
This document provides an overview and introduction to mortgage-backed securities (MBS) and collateralized mortgage obligations (CMOs). It discusses the process of securitization and how mortgage loans are pooled to form MBS which are then structured into CMOs to meet different investor objectives. Key points covered include the basic building blocks of MBS, how they differ from other fixed income securities due to prepayment risk and average lives, and the types and characteristics of agency and private label MBS and CMO structures.
This document discusses different types of collateral security that can be used to secure loans. It defines collateral security as property or other assets offered by a borrower to a lender to secure a loan. If the borrower defaults, the lender can seize the collateral. The document provides examples of acceptable collateral like cash, securities, land, buildings, and personal guarantees. It discusses the advantages and disadvantages of different types of collateral security and how they can help mitigate risk for the lender.
The document provides an overview of the Danish banking law system. It summarizes that Denmark has approximately 80 credit institutions regulated by the Danish Financial Supervisory Authority. The main types are banks, savings banks, and mortgage credit institutions. Danish banking law is codified but operates largely on freedom of contract principles, especially for commercial loans. Key aspects covered include types of loan agreements, security interests like mortgages and pledges, financial assistance restrictions, and applicability of the Rome II and European Insolvency Regulations.
This document defines collateral/security and describes the types of collateral a bank may accept. Tangible collateral includes land, buildings, machinery, vehicles, stocks and inventory. Intangible collateral includes guarantees and deposit accounts. When providing loans, banks require collateral to ensure repayment. The value of the collateral must exceed the loan amount, with the difference called the margin. This margin protects the bank in case the collateral must be seized and sold. The amount a borrower can borrow against a specific collateral is their drawing power. The document also outlines different forms of financing like loans, overdrafts and bill discounting that banks use to provide funds to borrowers.
This document provides an overview of bank guarantees, including:
1) It defines a bank guarantee as a contract where the bank guarantees to perform a third party's liability in case of default. The parties involved are the applicant, beneficiary, and guarantor bank.
2) Common purposes of bank guarantees include providing security deposits, mobilizing funds, and ensuring performance or payment on contracts.
3) Guidelines state banks should exercise caution with performance guarantees and generally limit guarantees to 18 months, taking security such as cash margins from applicants.
4) Proper appraisal of guarantees is required similar to loans, examining the applicant's financial strength and purpose of the guarantee.
Credit Facilities Extended By Bank (Iipm)toocoolnikhil
There are two main forms of bank lending:
1) Fund based lending includes facilities like term loans, cash credits, and overdrafts where money is immediately paid out to the borrower and appears on the bank's balance sheet.
2) Non-fund based lending includes guarantees, letters of credit, and co-acceptances where there is no immediate outflow of funds but the bank is committed to future payment which appears as a contingent liability.
Such loans are given to stock brokers and market makers Banks also grant loans against units of mutual fund. However in this case the amount of advance should be linked to Net Asset Value or market value whichever is less. One of the guidelines to be followed while granting this loan is that banks should satisfy themselves with the marketability of this loan. And banks should not advance against partly paid shares. Banks may determine the rate of interest without referring to Benchmark Prime Lending Rate. Certain prohibitions apply. For instance, banks cannot sanction loans against equity shares of the banking company to its directors. Banks cannot lend to their employees through employee trusts set up by them. Also, a bank’s total exposure including both fund and non fund categories should not exceed 15% of the total advances as of 31 March in the previous year.
Collateral is property pledged as security against a loan. If the loan is not repaid, the lender can seize or sell the collateral to recover funds. Common types of collateral include real estate like homes or buildings, equipment, life insurance policies, personal guarantees, and investment assets. Collateral benefits lenders by reducing investment risk if the borrower defaults on repayment. It also helps borrowers access capital needed to start businesses.
This document provides an overview and introduction to mortgage-backed securities (MBS) and collateralized mortgage obligations (CMOs). It discusses the process of securitization and how mortgage loans are pooled to form MBS which are then structured into CMOs to meet different investor objectives. Key points covered include the basic building blocks of MBS, how they differ from other fixed income securities due to prepayment risk and average lives, and the types and characteristics of agency and private label MBS and CMO structures.
This document provides an overview of life insurance, including its key concepts, features, history and products. It discusses how life insurance works as a risk cover for human life and compensates for financial loss. The document also outlines the regulations governing life insurance in India, the principles of life insurance, and the roles and leading providers of life insurance in the country. It concludes by explaining how life insurance protects individuals and families from financial risks.
This document provides an overview of Chapter 20 from a finance textbook, which covers long-term debt, preferred stock, and common stock. It defines key terms related to bonds, preferred stock, and common stock. It also describes various types of long-term debt instruments such as debentures, subordinated debentures, income bonds, junk bonds, and mortgage bonds. Additionally, it discusses preferred stock features like cumulative dividends and participating features. Finally, it explains how bonds can be retired through sinking funds and serial bond issuances.
Bank guarantees and standby letters of credit can be used as alternatives to cash collateral when additional security is needed, especially when the financial strength of the counterparty is uncertain. They correlate with commercial events like contracts and deliveries. Common types include payment guarantees, transfer guarantees, and guarantees issued to governmental entities. The key parties are the principal, beneficiary, and bank or guarantor. Guarantees are either suretyship, where the guarantor can review the underlying contract, or demand, where the guarantor must pay on first demand. Rules like ISP98 and URDG458 govern guarantees and standbys.
Collateral has been used for hundreds of years to provide security against payment default. Collateral management began in the 1980s with banks taking collateral against credit exposure, though there were no legal standards. Collateralization of derivatives became widespread in the early 1990s and standardization began in 1994. Collateral management has evolved rapidly with new technologies, competitive pressures, and heightened counterparty risk from derivatives and securitization. As a result, collateral management is now a complex process involving multiple parties.
Life insurance concept, nature & use of life insurance, distinguishing c...Ravi kumar
Life insurance is a contract where an insurer agrees to pay a designated beneficiary a sum of money upon the death of the insured. Key features include the payment of regular premiums by the policyholder and a lump sum payment to beneficiaries. The process involves filling out an application, providing proof of age and medical examination, and acceptance by the insurer. Life insurance provides financial protection for dependents and encourages savings. It has an economic nature by providing for a family's needs and a legal nature as defined by law. Characteristics include insurable interest of beneficiaries and utmost good faith of both parties.
This document provides an overview of loan trading practices across various jurisdictions globally. It discusses the main methods for transferring loans, including assignment, novation, and participations. It also addresses key issues like guarantees and security, confidentiality, tax implications, and regulatory compliance considerations for each jurisdiction. The document aims to provide loan market participants with insights into local law issues to consider when trading loans internationally. It covers 19 jurisdictions in Europe, Asia, North America, and elsewhere.
Olswang Construction Law Masterclass - October 2014 - Liqudated Damages and P...Francis Ho
This document discusses liquidated damages clauses in construction contracts. It defines liquidated damages as a pre-determined sum payable in the event of a specified breach of contract, and explains that they aim to provide a genuine pre-estimate of loss to avoid disputes over damages calculations. The document outlines reasons for using liquidated damages clauses and defenses against them, and analyzes how courts determine whether a clause imposes a penalty rather than reasonable damages. It also discusses implications if a challenge to liquidated damages succeeds.
The document discusses various concepts related to security for debts in India, including creation, perfection, and enforcement of security interests such as mortgages and hypothecations. It defines security as a charge over property belonging to a debtor to benefit a creditor. There are various types of security like contractual security (mortgage, hypothecation, charge), security by operation of law, and possessory vs. non-possessory security. The key steps in creating a valid security interest are documentation, stamp duty, registration, and perfection by registering the charge under applicable laws. Enforcement of security can be through court processes or out of court based on the type of security created and contractual terms.
The document discusses non-fund based credit facilities provided by banks, including letters of credit, guarantees, and co-acceptance of bills. It provides details on:
1) How these facilities work and the parties involved, including the applicant, issuing bank, beneficiary, advising/confirming/negotiating banks.
2) Guidelines from the Reserve Bank of India for these facilities, focusing on eligibility criteria for customers and banks' obligations.
3) Specific requirements for letters of credit, guarantees, and co-acceptance of bills.
The document discusses term loans, provisions of loan agreements, equipment financing, and lease financing. It provides examples and explanations of different types of term loans, costs and benefits, provisions that are frequently included in loan agreements, sources and types of equipment financing, different types of leasing arrangements, and how to evaluate leases versus debt financing by calculating the present value of cash flows for each. It also includes an example comparing the present value of cash outflows for leasing versus purchasing a new machine.
This document provides an overview of instalment warrant strategies, also known as limited recourse borrowing arrangements, for self managed superannuation funds (SMSFs) in Australia. It discusses:
- A brief history of SMSF borrowing and the legal changes over time.
- Key features of typical SMSF borrowing structures, including using a custodian trustee and stamp duty considerations.
- The six key changes introduced by section 67A of the Superannuation Industry (Supervision) Act 1993, regarding terminology, allowable assets, refinancing, use of funds, guarantees, and replacement assets.
- Current uncertainties around the new laws, particularly regarding properties spread over multiple titles and borrowing to acquire
This document discusses bank guarantees and co-acceptance of bills. It provides details on what a bank guarantee is, the parties involved, types of guarantees, how guarantees are used in export business and safeguards for issuing guarantees. It also discusses guidelines for guarantee business, precautions for issuing guarantees, and how banks can provide co-acceptance of bills as a facility for their customers.
The document provides an overview of education loans, including their purpose, tax benefits, and tips for planning an education loan. It begins by stating that the purpose of education loans is to provide financial assistance to deserving students to pursue higher education. It describes that interest paid on education loans is tax deductible under Section 80E of the Indian Income Tax Act without any limit. Some tips for planning an education loan include assessing one's career interests and skills, researching occupations and educational programs, and planning for education costs. The document aims to help students and parents understand education loans and make informed decisions about financing higher education.
The document discusses exposure norms set by the Reserve Bank of India (RBI) for banks. It defines key terms like exposure, credit exposure, investment exposure, and provides limits on a bank's exposure to individual borrowers, groups, sectors and capital markets. The limits are meant to manage credit risk and avoid high concentration in specific sectors. Exposure includes both funded and non-funded facilities. The document also discusses exemptions to the exposure limits.
The Council agreed its position on a draft directive establishing a framework for resolving failing banks. Key elements include:
- Requiring banks to prepare recovery plans and resolution authorities to prepare resolution plans.
- Granting authorities powers for early intervention and resolution tools like bail-in of creditors, asset separation, and bridge banks.
- Establishing national resolution funds financed by bank contributions to ensure bail-in can be applied effectively.
- Setting a target level for the funds of 0.8% of covered deposits to be reached within 10 years.
Mortgage actions made up a significant proportion of the Supreme Court of Western Australia's civil caseload from 2011 to 2014, ranging from 31% to 44% of total civil lodgments. Unconscionable dealing claims involve assessing whether the borrower suffered from special disadvantages affecting their judgment, if the lender was aware of this, and took advantage. Successful claims may see loans rendered unsecured but still owing. It can help to apply to external dispute resolution bodies like the Financial Ombudsman Service which operate without prejudice and aim for fairness.
Principles of valid contract special principles of life insuranceVaishnavi Devi
This document discusses the principles of valid life insurance contracts. It outlines several key elements, including insurable interest which requires that the policy owner has a financial interest in the insured individual's life. It also discusses the principle of utmost good faith which requires high levels of disclosure from the policy owner. Additionally, it explains that life insurance contracts are not contracts of indemnity, unlike most other types of insurance. The document provides an overview of the key features and principles of life insurance.
The document discusses various types of loans and advances provided by banks, as well as the principles of sound lending. It describes how banks earn profits by providing loans and advances to individuals, businesses, and industrialists. Some key points covered include:
- Banks provide secured and unsecured advances, with secured advances having a primary security/collateral pledged by the borrower, such as machinery.
- The main types of advances are loans, cash credits, overdrafts, and bills discounted. Loans can be short-term or long-term based on purpose.
- Banks employ various methods to charge security for loans, including lien, pledge, mortgage, assignment, and hypothecation of movable property.
Bpe Presentation On Changes To The Construction Act 2010 V7 1 Final Read OnlyJonClose
BPE Solicitors LLP provides an overview of changes to the Construction Act 2010. Key changes include removing the requirement for construction contracts to be in writing, banning "pay-when-paid" and "Tolent" clauses, and clarifying payment terms and processes including notices of unpaid amounts and the ability to suspend work for non-payment. The presenters discuss implications such as more adjudication cases and potential delays on projects as suspension of work increases. They conclude by noting the need for employers and contractors to be aware of and comply with new payment procedures.
Introduction to Negotiable Instruments ActVadivelM9
The document discusses negotiable instruments under the Negotiable Instruments Act of 1881. It defines key terms like cheque, promissory note, bill of exchange. It describes the characteristics of negotiable instruments like being transferable and signed documents. It then explains the different types of cheque crossing - general, special, restrictive, non-negotiable. It also discusses endorsement types like blank, special, restrictive, partial and conditional. Finally, it defines material alteration and what would constitute a material change to a negotiable instrument.
Special Purpose Vehicals Securitizationfinancedude
Special Purpose Entities (SPEs) are legal entities created for specific purposes in structuring securitization transactions. SPEs are critical components of the $5.2 trillion U.S. securitization market, which provides liquidity to financial institutions and consumers through products like mortgages and credit cards. SPEs hold pools of financial assets, issue securities to investors, and protect investors from bankruptcy risk of the financial institution that established the SPE. Accounting standards require disclosure of risks and obligations associated with SPE transactions, even if the SPE is not consolidated on the financial institution's balance sheet.
This document discusses lending in the banking business. It covers general principles of good lending, the typical banking lending cycle, and key remedies for defaulting borrowers such as insolvency, receivership, and their effects. Specifically, it examines various types of securities and collateral that banks can take to secure advances or loans made to customers. These include mortgages on land and buildings, chattel mortgages on movable assets, guarantees, cash collateral from deposits, loan and property insurance, post-dated cheques, and group co-guarantees among microfinance borrowers.
This document provides an overview of life insurance, including its key concepts, features, history and products. It discusses how life insurance works as a risk cover for human life and compensates for financial loss. The document also outlines the regulations governing life insurance in India, the principles of life insurance, and the roles and leading providers of life insurance in the country. It concludes by explaining how life insurance protects individuals and families from financial risks.
This document provides an overview of Chapter 20 from a finance textbook, which covers long-term debt, preferred stock, and common stock. It defines key terms related to bonds, preferred stock, and common stock. It also describes various types of long-term debt instruments such as debentures, subordinated debentures, income bonds, junk bonds, and mortgage bonds. Additionally, it discusses preferred stock features like cumulative dividends and participating features. Finally, it explains how bonds can be retired through sinking funds and serial bond issuances.
Bank guarantees and standby letters of credit can be used as alternatives to cash collateral when additional security is needed, especially when the financial strength of the counterparty is uncertain. They correlate with commercial events like contracts and deliveries. Common types include payment guarantees, transfer guarantees, and guarantees issued to governmental entities. The key parties are the principal, beneficiary, and bank or guarantor. Guarantees are either suretyship, where the guarantor can review the underlying contract, or demand, where the guarantor must pay on first demand. Rules like ISP98 and URDG458 govern guarantees and standbys.
Collateral has been used for hundreds of years to provide security against payment default. Collateral management began in the 1980s with banks taking collateral against credit exposure, though there were no legal standards. Collateralization of derivatives became widespread in the early 1990s and standardization began in 1994. Collateral management has evolved rapidly with new technologies, competitive pressures, and heightened counterparty risk from derivatives and securitization. As a result, collateral management is now a complex process involving multiple parties.
Life insurance concept, nature & use of life insurance, distinguishing c...Ravi kumar
Life insurance is a contract where an insurer agrees to pay a designated beneficiary a sum of money upon the death of the insured. Key features include the payment of regular premiums by the policyholder and a lump sum payment to beneficiaries. The process involves filling out an application, providing proof of age and medical examination, and acceptance by the insurer. Life insurance provides financial protection for dependents and encourages savings. It has an economic nature by providing for a family's needs and a legal nature as defined by law. Characteristics include insurable interest of beneficiaries and utmost good faith of both parties.
This document provides an overview of loan trading practices across various jurisdictions globally. It discusses the main methods for transferring loans, including assignment, novation, and participations. It also addresses key issues like guarantees and security, confidentiality, tax implications, and regulatory compliance considerations for each jurisdiction. The document aims to provide loan market participants with insights into local law issues to consider when trading loans internationally. It covers 19 jurisdictions in Europe, Asia, North America, and elsewhere.
Olswang Construction Law Masterclass - October 2014 - Liqudated Damages and P...Francis Ho
This document discusses liquidated damages clauses in construction contracts. It defines liquidated damages as a pre-determined sum payable in the event of a specified breach of contract, and explains that they aim to provide a genuine pre-estimate of loss to avoid disputes over damages calculations. The document outlines reasons for using liquidated damages clauses and defenses against them, and analyzes how courts determine whether a clause imposes a penalty rather than reasonable damages. It also discusses implications if a challenge to liquidated damages succeeds.
The document discusses various concepts related to security for debts in India, including creation, perfection, and enforcement of security interests such as mortgages and hypothecations. It defines security as a charge over property belonging to a debtor to benefit a creditor. There are various types of security like contractual security (mortgage, hypothecation, charge), security by operation of law, and possessory vs. non-possessory security. The key steps in creating a valid security interest are documentation, stamp duty, registration, and perfection by registering the charge under applicable laws. Enforcement of security can be through court processes or out of court based on the type of security created and contractual terms.
The document discusses non-fund based credit facilities provided by banks, including letters of credit, guarantees, and co-acceptance of bills. It provides details on:
1) How these facilities work and the parties involved, including the applicant, issuing bank, beneficiary, advising/confirming/negotiating banks.
2) Guidelines from the Reserve Bank of India for these facilities, focusing on eligibility criteria for customers and banks' obligations.
3) Specific requirements for letters of credit, guarantees, and co-acceptance of bills.
The document discusses term loans, provisions of loan agreements, equipment financing, and lease financing. It provides examples and explanations of different types of term loans, costs and benefits, provisions that are frequently included in loan agreements, sources and types of equipment financing, different types of leasing arrangements, and how to evaluate leases versus debt financing by calculating the present value of cash flows for each. It also includes an example comparing the present value of cash outflows for leasing versus purchasing a new machine.
This document provides an overview of instalment warrant strategies, also known as limited recourse borrowing arrangements, for self managed superannuation funds (SMSFs) in Australia. It discusses:
- A brief history of SMSF borrowing and the legal changes over time.
- Key features of typical SMSF borrowing structures, including using a custodian trustee and stamp duty considerations.
- The six key changes introduced by section 67A of the Superannuation Industry (Supervision) Act 1993, regarding terminology, allowable assets, refinancing, use of funds, guarantees, and replacement assets.
- Current uncertainties around the new laws, particularly regarding properties spread over multiple titles and borrowing to acquire
This document discusses bank guarantees and co-acceptance of bills. It provides details on what a bank guarantee is, the parties involved, types of guarantees, how guarantees are used in export business and safeguards for issuing guarantees. It also discusses guidelines for guarantee business, precautions for issuing guarantees, and how banks can provide co-acceptance of bills as a facility for their customers.
The document provides an overview of education loans, including their purpose, tax benefits, and tips for planning an education loan. It begins by stating that the purpose of education loans is to provide financial assistance to deserving students to pursue higher education. It describes that interest paid on education loans is tax deductible under Section 80E of the Indian Income Tax Act without any limit. Some tips for planning an education loan include assessing one's career interests and skills, researching occupations and educational programs, and planning for education costs. The document aims to help students and parents understand education loans and make informed decisions about financing higher education.
The document discusses exposure norms set by the Reserve Bank of India (RBI) for banks. It defines key terms like exposure, credit exposure, investment exposure, and provides limits on a bank's exposure to individual borrowers, groups, sectors and capital markets. The limits are meant to manage credit risk and avoid high concentration in specific sectors. Exposure includes both funded and non-funded facilities. The document also discusses exemptions to the exposure limits.
The Council agreed its position on a draft directive establishing a framework for resolving failing banks. Key elements include:
- Requiring banks to prepare recovery plans and resolution authorities to prepare resolution plans.
- Granting authorities powers for early intervention and resolution tools like bail-in of creditors, asset separation, and bridge banks.
- Establishing national resolution funds financed by bank contributions to ensure bail-in can be applied effectively.
- Setting a target level for the funds of 0.8% of covered deposits to be reached within 10 years.
Mortgage actions made up a significant proportion of the Supreme Court of Western Australia's civil caseload from 2011 to 2014, ranging from 31% to 44% of total civil lodgments. Unconscionable dealing claims involve assessing whether the borrower suffered from special disadvantages affecting their judgment, if the lender was aware of this, and took advantage. Successful claims may see loans rendered unsecured but still owing. It can help to apply to external dispute resolution bodies like the Financial Ombudsman Service which operate without prejudice and aim for fairness.
Principles of valid contract special principles of life insuranceVaishnavi Devi
This document discusses the principles of valid life insurance contracts. It outlines several key elements, including insurable interest which requires that the policy owner has a financial interest in the insured individual's life. It also discusses the principle of utmost good faith which requires high levels of disclosure from the policy owner. Additionally, it explains that life insurance contracts are not contracts of indemnity, unlike most other types of insurance. The document provides an overview of the key features and principles of life insurance.
The document discusses various types of loans and advances provided by banks, as well as the principles of sound lending. It describes how banks earn profits by providing loans and advances to individuals, businesses, and industrialists. Some key points covered include:
- Banks provide secured and unsecured advances, with secured advances having a primary security/collateral pledged by the borrower, such as machinery.
- The main types of advances are loans, cash credits, overdrafts, and bills discounted. Loans can be short-term or long-term based on purpose.
- Banks employ various methods to charge security for loans, including lien, pledge, mortgage, assignment, and hypothecation of movable property.
Bpe Presentation On Changes To The Construction Act 2010 V7 1 Final Read OnlyJonClose
BPE Solicitors LLP provides an overview of changes to the Construction Act 2010. Key changes include removing the requirement for construction contracts to be in writing, banning "pay-when-paid" and "Tolent" clauses, and clarifying payment terms and processes including notices of unpaid amounts and the ability to suspend work for non-payment. The presenters discuss implications such as more adjudication cases and potential delays on projects as suspension of work increases. They conclude by noting the need for employers and contractors to be aware of and comply with new payment procedures.
Introduction to Negotiable Instruments ActVadivelM9
The document discusses negotiable instruments under the Negotiable Instruments Act of 1881. It defines key terms like cheque, promissory note, bill of exchange. It describes the characteristics of negotiable instruments like being transferable and signed documents. It then explains the different types of cheque crossing - general, special, restrictive, non-negotiable. It also discusses endorsement types like blank, special, restrictive, partial and conditional. Finally, it defines material alteration and what would constitute a material change to a negotiable instrument.
Special Purpose Vehicals Securitizationfinancedude
Special Purpose Entities (SPEs) are legal entities created for specific purposes in structuring securitization transactions. SPEs are critical components of the $5.2 trillion U.S. securitization market, which provides liquidity to financial institutions and consumers through products like mortgages and credit cards. SPEs hold pools of financial assets, issue securities to investors, and protect investors from bankruptcy risk of the financial institution that established the SPE. Accounting standards require disclosure of risks and obligations associated with SPE transactions, even if the SPE is not consolidated on the financial institution's balance sheet.
This document discusses lending in the banking business. It covers general principles of good lending, the typical banking lending cycle, and key remedies for defaulting borrowers such as insolvency, receivership, and their effects. Specifically, it examines various types of securities and collateral that banks can take to secure advances or loans made to customers. These include mortgages on land and buildings, chattel mortgages on movable assets, guarantees, cash collateral from deposits, loan and property insurance, post-dated cheques, and group co-guarantees among microfinance borrowers.
Derivatives and risk management made simpleMarjo Kaci
This document provides a summary of derivatives and risk management strategies for pension funds. It discusses how pension funds can use derivatives such as interest rate swaps, inflation swaps, and options to hedge against market risks like changes in interest rates and inflation. It also describes common methodologies for calculating market risk exposure, including gross notional exposure and global exposure as defined by the commitment approach outlined by ESMA guidelines. The document is intended to introduce UK pension funds to derivative instruments, the market and counterparty risks associated with them, and how to measure and apply risk methodologies to manage these risks.
Mediation In Criminal Matters [Compatibility Mode]P. Wouters
1. Belgian law allows for out of court settlements in criminal cases negotiated by prosecutors, sometimes including victims.
2. European initiatives aim to formalize mediation in criminal matters.
3. Council of Europe recommendations provide guidelines for competent mediators to balance party vulnerabilities in criminal mediation.
The Uniform Commercial Code (“UCC”) is a uniform act that was established to harmonize the laws of sales and commercial transactions. It has been substantially adopted in all 50 states and the District of Columbia. The UCC is divided into 11 Articles with each one addressing a different area of commercial law. Article 9 governs security interests in personal property and contains detailed rules regarding the creation, attachment, and perfection of security interests; the relative priorities of competing security interests; and remedies available to a creditor upon a borrower's default. The navigation of the debtor-creditor relationship is at the heart of any bankruptcy proceeding. This webinar examines some of the key issues involving the interaction between a debtor and its secured creditors both before and after the filing of a bankruptcy, including the pre-bankruptcy perfection and priority of security interests, the post-bankruptcy protection of a secured creditor’s rights in a debtor’s collateral, and the options available for the parties to address and administer such collateral in the context of a bankruptcy proceeding.
Part of the webinar series: BANKRUPTCY INTERSECTIONS 2022
See more at https://www.financialpoise.com/webinars/
Characteristics of Collateral As A Special Guarantee in The Banking EnvironmentAJHSSR Journal
ABSTRACT: The characteristics of collateral as special guarantees in the banking environment can be
divided into two, namely general guarantees and special guarantees. existing or new ones that will exist in the
future, become dependents for all individual engagements". And a special guarantee is regulated in article 1132
BW: “The object becomes a joint guarantee for all those who owe it; The income from the sale of the objects is
divided according to the balance, that is, according to the size of each bill, unless there are valid reasons for the
debtors to take precedence. Special guarantees are born from material guarantee agreements, namely: liens,
mortgages, mortgages and fiduciaries which give birth to liens, mortgage rights, mortgage rights and fiduciary
rights. As for the main characteristics of collateral, among others: the first is absolute. Material rights are
absolute, meaning that rights can be enforced against anyone Droit de suite. Material rights will follow the
object in the hands of whoever the object is. Second, there is the principle of priority, meaning that material
rights that were born first take precedence over material rights that were born later. The third is preferential,
meaning that material rights are rights given to creditors to take precedence in taking repayments over other
creditors.
Keywords: main characteristics of collateral, special guarantees, banking
Securitization is the process of converting future cash flows from assets into marketable securities that can be sold to investors. An originator transfers a pool of financial assets like loans or receivables to a special purpose vehicle (SPV). The SPV issues securities called pass-through certificates or pay-through certificates to investors to fund the purchase. Investors receive periodic payments from the cash flows generated by the underlying assets. This allows the originator to raise funds and transfer assets off its balance sheet.
20121002 Address by Martin Moloney to the International Bar Association - Con...Martin Moloney
Martin Moloney discusses several issues relating to the regulation of investment funds in Ireland and Europe, including UCITS, AIFMD, money market funds, and UCITS VI. Some of the key points include:
1) While UCITS provides important investor protections, UCITS VI discussions aim to address concerns about overly complex investment strategies and leverage in UCITS funds.
2) Money market funds are part of the "shadow banking" system and concerns exist about potential "run risk", though simply focusing on CNAV funds may not fully address the issue.
3) Coordination will be important as different jurisdictions consider reforms to money market funds to reduce risks while minimizing disruption.
Country Comparative Legal Guides to Insurance & Reinsurance, Ireland 2017Matheson Law Firm
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1. Bener
Istanbul - Turkey Client Briefing
General Introduction
EU-Directive on
EU-
Financial Collateral
2002/EC/47
Turkish point of view – the Belgian Window
Paul WOUTERS - Bener Danışmanlık A.Ş. -
Istanbul - Turkey
2. Bener
Istanbul - Turkey Client Briefing
General Introduction
This Power Point Presentation introduces the viewer
Into some highlights of the EU-Directive on Financial Collateral.
EU-
It only refers to the specific situation with respect to some of the Belgian-Turkish aspects.
Belgian-
If you live in another country then Turkey or refer to another EU-country then Belgium,
EU-
your situation might be different.
In any case, we advice you to get proper legal advice before taking any legal action since
every situation has its’ own merits.
Paul WOUTERS - Bener Danışmanlık A.Ş. -
Istanbul - Turkey
3. Bener
Istanbul - Turkey
First example of a problem scenario
A bank buys shares on the stock exchange for the account of a client.
Towards the other market player / seller the bank has a direct and
personal obligation to pay.
Most od the time the bank will be covered by some kind of collateral /
security furnished by the client.
However, when the client does not pay as agreed, the bank has to
finance his credit, is exposed vis-a-vis those third counter parties on the
vis-
stock exchange for immediate payment and sometimes even is
endangered (for instance at stock exchange crash situations where
overnight a lot of clients do not pay their debts).
Though properly secured with collateral, the financial insitution can
not execute rapidly on the security of her clients and can get into
trouble.
trouble. Paul WOUTERS - Bener Danışmanlık A.Ş. -
Istanbul - Turkey
4. Bener
Istanbul - Turkey
Second example of a problem scenario
A construction company has a performance security from a subcontractor.
The subcontractor becomes subject to insolvency proceedings and the
construction company suddenly is facing (1)penalties for late performance
by the principal and (2) supplementary costs for replacing the defaulting
subcontractor.
The performance security has to be enforced in order to cover these costs
and penalties.
Though properly secured with collateral, the construction company can
not execute rapidly on the security of the subcontractor and can get into
trouble.
trouble.
Paul WOUTERS - Bener Danışmanlık A.Ş. -
Istanbul - Turkey
5. Bener
Istanbul - Turkey
In general :
The establishment of a security requires redaction of formal paperwork /
contracts that have to be updated regularly – for instance when the
composition of the security changes (shares or bonds are sold in the
course of time and substituted by other assets ...) or the debt to which it
is applicable changes - ...
If not properly managed, all this could affect the validity of an originally
properly construed financial collateral.
The enforcement of the collateral most of the time is a costly and
lengthy procedure in courts with all risks attached to it.
Nothing more frustrating then having good collateral but not being able
to use it for a long time (and maybe see its’ market value go down all the
time). Paul WOUTERS - Bener Danışmanlık A.Ş. -
Istanbul - Turkey
6. Bener
Istanbul - Turkey
In domestic situations, the legal background is usually known to both
situations,
collateral provider and –taker and the law chosen normally coincides
with the applicable insolvency laws.
However, in a cross-border transaction the laws of different States
cross-
may apply to different parts of a transaction.
For instance: the security provided by a debtor may be situated in one
State, the debt itself may be governed by the law of another State, the
debtor may be incorporated in a third State ...
The cross-border use of securities, together with the international
cross-
nature of the market participants, make it increasingly difficult to
identify which State’s laws apply to which parts of the transaction.
Paul WOUTERS - Bener Danışmanlık A.Ş. -
Istanbul - Turkey
7. Bener
Istanbul - Turkey
The EU- Directive on Financial Collateral :
EU-
* the number of transactions
* the speed and sequence with which they have to be executed
* the value in currency that each transaction represents
* the speed with which (additional) security / margin has to
be called
* the sheer size of the (professional) counterparties
make the likelyhood of a “mistake” in the perfection or maintenance
phase and / or the consequences of a non-payment by the “client” a
non-
real danger AND increases the impact of such mistake on the stability
of the financial institutions.
The lengthy legal enforcement process further creates the danger that
one insolvency in the financial chain could trigger another one.
Undesired DOMINO-effect could happen.
DOMINO- Paul WOUTERS - Bener Danışmanlık A.Ş. -
Istanbul - Turkey
8. Bener
Istanbul - Turkey
Within the framework of the Financial Markets Action Plan and
in order to:
* safeguard financial stability and limit contagion effects in case of
default of a party to a financial collateral arrangement
* improve the legal certainty of financial collateral arrangements
* avoid negative effects of cross border insolvency procedures on
such financial collateral arrangements
* limit the administrative burdens for parties using financial collateral
* provide for rapid and non-formalistic enforcement procedures
non-
The EU-authorities issued a Directive that has been implemented now
EU-
in most EU-Member States. Belgium has inserted very “liberal”
EU-
provisions in its’ local legislation, open to a broad range of parties
concerned and of different kinds of collateral that can be used.
Paul WOUTERS - Bener Danışmanlık A.Ş. -
Istanbul - Turkey
9. Bener
Istanbul - Turkey
EU Collateral Directive
1. Definitions :
1. what do we mean by financial collateral agreement
2. which parties should be involved in order to use the benefits of the
EU-Directive as applied in Belgium
EU-
3. what is financial collateral : cash or negotiable financial instruments
4. for which debts can it be used : financial debts
Paul WOUTERS - Bener Danışmanlık A.Ş. -
Istanbul - Turkey
10. Bener
Istanbul - Turkey
1. What is meant by a “financial collateral agreement”
This is an arrangement under which:
* a collateral provider provides a financial collateral in favor of a
collateral taker
* to secure the performance of an obligation
* and where either full ownership of the financial collateral remains with
the collateral provider (pledge, charge, lien) OR whereby transfer of
the full ownership of the assets with buy-back (repurchase or transfer
buy-
of title arrangement) is agreed upon
The Directive did also expand to close out netting agreements .
Paul WOUTERS - Bener Danışmanlık A.Ş. -
Istanbul - Turkey
11. Bener
Istanbul - Turkey
2. Which parties should be involved to make the Directive applicable:
* public authorities from EU-Member States
EU-
* EU central banks, European Central Bank, Bank for International
Settlements, a multilateral development bank, I.M.F., European
Investment Bank
* EU financial institution (credit institution, investment firm, financial
institution, insurance institution, undertaking for collective investment,
management company)
* EU central counterparty, settlement agent or clearing house
* a person - other then a natural person – including unincorporated
firms and partnerships provided the other party is a EU “institution” as
defined above (‘opt out’ possible – Belgium did not do this)
Note: The Belgian Law of December 15, 2004 on Financial Collateral
does NOT implement this restriction and is avaliable to ALL parties,
natural persons included, EU non-residents included, even if neither
non-
collateral taker – giver or debtor are a EU financial institution.
Paul WOUTERS - Bener Danışmanlık A.Ş. -
Istanbul - Turkey
12. Bener
Istanbul - Turkey
3. The financial collateral / security can consist of :
* cash (money credited to an account in any currency - or money
market deposits)
* shares or securities equivalent to shares, bonds and other debt
instruments, if these are negotiable on the capital markets
* other securities which give the holder right to acquire such shares,
bonds or debt instruments
* derivatives and any rights relating to them
(note: this definition can be slightly different in all EU-Memberstates)
EU-
Paul WOUTERS - Bener Danışmanlık A.Ş. -
Istanbul - Turkey
13. Bener
Istanbul - Turkey
4. The debt has to be a “financial obligation”:
* can be a present or future obligation
* can be an obligation owed to the collateral taker, by a person other
then the collateral provider
Paul WOUTERS - Bener Danışmanlık A.Ş. -
Istanbul - Turkey
14. Bener
Istanbul - Turkey
EU Collateral Directive
2. Measures that have been taken :
1. reducing formal requirements
2. easy and rapid enforcement
3. right of use, recognition of title transfer financial
collateral and close-out netting provisions
close-
4. certain insolvency provisions disapplied
5. avoidance conflict of laws
Paul WOUTERS - Bener Danışmanlık A.Ş. -
Istanbul - Turkey
15. Bener
Istanbul - Turkey
1. Reducing formal requirements
* There are no longer any legal requirements to create, validate,
perfect or admit in evidence such collateral. However, for
matters of proof it is still advised to draft a broad collateral
agreement.
(e.g. notarial deeds, registration requirements, notification requirements,
public announcements or other formal certification are NOT required)
* The collateral however has to be transfered into the
possession of the collateral taker.
taker.
The deposit of the cash or the financial instruments into a
special account (even held by a third party – bank) is sufficient
to organize transfer of possession and to ensure the validity and
perfection of the collateral takers’ rights without any further
formality.
Paul WOUTERS - Bener Danışmanlık A.Ş. -
Istanbul - Turkey
* Margin calls and substitution of collateral have been accepted.
16. Bener
Istanbul - Turkey
2. Easy and rapid enforcement
The collateral may be enforced:
* without prior notification to the collateral provider / debtor
and without court intervention
* if so agreed upon in the collateral agreement and if proper
valuation standards have been stipulated: even without
forced sale at the stock exchange, but by simple
appropriation and setting off their value – money is enforced
by simple compensation
Paul WOUTERS - Bener Danışmanlık A.Ş. -
Istanbul - Turkey
17. Bener
Istanbul - Turkey
3. Right of use
If so agreed upon in the Financial Collateral Agreement and to such
extent:
* the collateral taker is entitled to exercise a right of use in
relation to the collateral
(he can alienate, sell ... the collateral)
* subject to the obligation to transfer equivalent collateral
into the account on the due date of performance
Paul WOUTERS - Bener Danışmanlık A.Ş. -
Istanbul - Turkey
18. Bener
Istanbul - Turkey
Recognition of title transfer collateral arrangements
The use of title deed transfer (repo) has been accepted as long as no
natural persons are involved.
Such is opposable to insolvency proceedings and third parties.
Recognition of close-out netting provisions
close-
Such notwithstanding insolvency proceedings and are opposable to third
parties.
Paul WOUTERS - Bener Danışmanlık A.Ş. -
Istanbul - Turkey
19. Bener
Istanbul - Turkey
4. Certain insolvency provisions disapplied
In general, the financial collateral arrangements may not be declared
invalid or void or be reversed on the sole basis that winding up
proceedings or reorganisation measures have commenced against one or
more parties involved and they can be opposed to such insolvency
proceedings and third parties.
The rules of the so-called “suspect period” before insolvency are set aside
so-
– except with respect of fraudulent acts.
5. Conflict of laws
The law of the EU-Memberstate in which country the relevant account is
EU-
maintained is applicable.
Such bank account has to be held in Belgium in order to use all of the
facilities mentioned above.
Paul WOUTERS - Bener Danışmanlık A.Ş. -
Istanbul - Turkey
20. Bener
Istanbul - Turkey
Résume : present execution scheme in Turkey:
1. creditor notifies debtor that due date has expired and summons to pay
2. if claim is contested: go to court and have debtor sentenced in
payment
3. start and execute enforcement proceedings on the collateral
4. go to stock exchange and sell collateral “at best price”
Résume : optimal use of Directive 2002/EC/47:
The collateral may be enforced (sold) directly without prior notification to
the collateral provider / debtor or court intervention.
If so agreed upon in the collateral agreement and if proper valuation
standards have been stipulated, simple appropriation of the financial
instruments is possible, together with direct compensation of the money
involved.
If so agreed upon and to such extent,Turkey collateral taker is allowed to
Istanbul - the
Paul WOUTERS - Bener Danışmanlık A.Ş. -
use the collateral, provided restitution by equivalent at due date.
21. Bener
Istanbul - Turkey
Some relevant literature:
Directive 2002/47/EC of 6 June 2002 on financial collateral arrangements, Official Journal, L 168/43,
Journal,
27.06.2002, p. 43
Wet van 15.12.2004 betreffende financiële zekerheden en houdende diverse fiscale bepalingen inzake zakelijke-
zakelijke-
zekerheidsovereenkomsten en leningen met betrekking tot financiële instrumenten, B.S., 01.02.2005
Devos, D.,‘The Directive 2002/47/EC on ‘Financial Collateral Arrangements of June 6, 2002’, Melanges en
hommage à Jean-Victor Louis, 2003. p. 258
Löber, K., ‘The developping EU legal framework for clearing and settlement of financial instruments’, E.C.B.,
Legal Working Paper Series, No 1, February 2006
note:
www.UNIDROIT.org almost literally copied the core provisions of the Collateral Directive in its draft convention
on harmonised substantive rules regarding securities held with an intermediary, November 2004 (published
23.12.2004) – final report Augustus 2005
http://www.unidroit.org/english/publications/proceedings/2005/study/78/s-78-23rev-e.pdf
Paul WOUTERS - Bener Danışmanlık A.Ş. -
Istanbul - Turkey
22. Bener
Istanbul - Turkey
Paul WOUTERS,
of counsel BENER Danışmanlık A.Ş., Istanbul - Turkey;
admitted to the Antwerp (Belgium) Bar Association in 1985;
Universiteit Antwerpen (Law School – 1983);
Mediator (alternative dispute resolution – 2000)
This presentation only intends to introduce to the broad guidelines of the Directive 2002/EC/47 on financial
collateral. For details and further information on specific issues or implementation into different EU-
EU-
jurisdictions, consult your legal adviser.
These areas of legislation are under constant evolution both on international and EU-level as on national levels.
EU-
It is advised to keep in touch and already prepare your services and administrations for upcomming changes on an ongoing
and daily basis.
Paul WOUTERS - Bener Danışmanlık A.Ş. -
Istanbul - Turkey