SECMP0016 Consideration of Maximum Credit Value in Credit Cover Calculation
This Modification Proposal was implemented 1 April 2017
What is the issue?
This Modification Proposal seeks to make changes to the SEC Credit Cover Requirement calculation so that it takes into account the credit value specified by an independent credit assessor.
What is the solution?
The solution requires a Party’s Maximum Credit Value offered in a Credit Assessment report is considered when calculating a Party’s Unsecured Credit Limit. The proposed calculation introduces an Unsecured Credit Factor, in place of the current CCF, that is a proportion of a Party’s Maximum Credit Value. The Unsecured Credit Factor is determined by the Party’s Recognised Credit Rating or Credit Assessment Score.
This proposed calculation reduces the current Credit Support held by the DCC to approximately 30% of the total Value at Risk for SEC Parties.
Who is impacted?
Other SEC Parties
What SEC documents are affected?
Section A 'Definitions and Interpretation'
Section J 'Charges'
Section K 'Charging Methodology'
SECMP0016 - Working Group Meeting 1 - Final Minutes
By subscribing you consent to receiving the SECAS newsletter.
The cookie settings on this website are set to "allow cookies" to give you the best browsing experience possible. If you continue to use this website without changing your cookie settings or you click "Accept" below then you are consenting to this.