How will the process work if a newly issued ABS closes on the same day as the TALF loan settlement date?
The borrower of a TALF loan must identify the counterparty expected to deliver the newly issued ABS to be pledged as collateral at the time of the loan subscription. When the borrower’s TALF Agent who submitted the loan request receives the confirmation of the loan and its details from the custodian two days prior to the loan settlement date, the TALF Agent can extract the pertinent information to generate and forward a trade confirmation to the borrower’s delivering counterparty. The delivering counterparty can be the lead underwriter or co-manager of the newly issued ABS, other syndicate member, or the TALF Agent of the borrower. The borrower must always remit the margin to their TALF Agent who submitted the loan request. If the TALF Agent is not the delivering counterparty, the TALF Agent will forward the margin to New York Fed’s cash custody account at the custodian in order for the issuer to receive the full purchase price of the security issue. The delivering counterparty will de
Related Questions
- Must an eligible borrower own newly issued ABS it plans to pledge as collateral for a TALF loan at the time it subscribes for the loan?
- How will the process work if a newly issued ABS closes on the same day as the TALF loan settlement date?
- How will the process work if a new ABS issue closes on the same day as the TALF loan settlement date?
