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SFTR Report - ETRM / MODI | Corporate Action Cluster - Full or Partial Return | Cash Move - Y>

Status: Best Practice Finalised, Last Updated: 24/05/2021

SFTR Report - ETRM / MODI | Corporate Action Cluster - Full or Partial Return | Cash Move - Y

Description:
Securities are redeemed in part before the scheduled final maturity date. It is done without any pool factor reduction. The redemption is reflected in a debit of the face amount (FAMT).

Best Practice:
If a full or partial position is outstanding on the redemption date and confirmation from the agent of the redemption, proceeds of this should be agreed between counterparties and paid on the pay date of the event. In the event of a redemption payment being made after pay date, the lender should continue to collateralise the full loan until the redemption payment is made.

Where applicable, and if agreed between both counterparties, the redemption proceeds can be netted with any cash collateral that has been exchanged on the position previously. As with redemptions, coupon payments upon confirmation of the event should be paid on pay date of the event. (COAC-43)