Swap counterparty meaning

In this issue: UK, EU and international regulators and bodies Accountability, culture and social governance Prudential requirements Risk management and controls Financial crime and sanctions Investigations, enforcement and discipline Regulation of benchmarks Regulation of capital markets Regulation of derivatives Sustainable finance and ESG Banks and mutuals Investment funds and asset management EU MiFID/MiFIR Consumer credit, mortgage and home finance Regulation of insurance Payment services and systems Regulation of AI in FS Daily and weekly news alerts Dates for your diary New and updated content Financial Services Enforcement Database LexTalk®Financial Services: a Lexis®Nexis community UK, EU and international regulators and bodies Commission sets out provisional timetable for 2025 initiativesThe European Commission has outlined a provisional timetable for the legislative proposals it intends to publish in 2025. See: LNB News 05/11/2025 42. FCA issues Handbook Notice No 134The Financial Conduct Authority...

An introduction to RMBS This Practice Note outlines the framework of residential mortgage-backed securities (RMBS) transactions, highlighting the principal participants, documentation and terminology involved. As with other financing methods and transactions, there are many ways in which the precise terms of any given deal may operate; these variations fall outside the scope of this Practice Note. It summarises the structure of such transactions and the principal parties, documents and terms they typically involve. Residential mortgage-backed securities (RMBS) are debt instruments whereby income generated by one or more pools of residential loans (loans) is applied to fund payments of interest and principal owed to noteholders. Security is taken over those loans and their related mortgages, which serve as collateral for amounts payable on the notes. RMBS transactions can be relatively simple pass-through instruments, or they can be complex, involving numerous parties and arranged in different structures and forms. The key features of a single issuance RMBS are summarised as follows: A newly incorporated, insolvency-remote special...

This glossary sets out numerous expressions regularly encountered in the restructuring & insolvency sphere. Words shown in bold within definitions are themselves explained in other entries in this glossary as well. A Article X The MLIJ contains a single provision named Article X, aimed at jurisdictions that have already implemented the MLCBI, like England, or are weighing its adoption. Article X states: ‘Not withstanding any prior interpretation to the contrary, the relief available under [insert a cross-reference to the legislation of this State enacting Article 21 of the UNCITRAL Model Law on Cross-Border Insolvency] includes recognition and enforcement of a judgment’ (see Practice Note: UNCITRAL model law on recognition and enforcement of insolvency-related judgments (MLIJ): Article X). Asset-backed security (ABS) A form of security anchored by asset pools, for example loans, leases, and credit card receivables. Assimilated law From 1 January 2024, ‘retained law’ has been retitled ‘assimilated law’. The body of domestic law originally arising from EU obligations, created by the European...

Swap arrangements Swap contracts are frequently used alongside the financing of UK property, primarily as protection against movements in interest rates. Where borrowing costs on UK real estate are charged at a floating rate, a borrower might enter an interest rate swap so it pays a fixed rate and receives a floating rate from the swap counterparty, using those receipts to service its debt. While this Practice Note concentrates on interest rate swaps, property-related swaps can also address other exposures, such as changes in foreign exchange, asset values and rental receipts. This Practice Note outlines the principal issues in assessing how UK real estate investors are taxed on their hedging swap positions. The tax position of swap dealers (that is, traders) in UK real estate falls outside the scope of this Practice Note. A standard property investment involves a taxpayer purchasing real estate to hold for a comparatively extended period, with the intention of earning returns by letting the property to tenants...