Examples of Synthetic Counterparty in a sentence
Consequently, the Issuer will be subject to the credit risk of the Synthetic Counterparty as well as that of the Reference Entity.
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In addition, in the event of the insolvency of the Synthetic Counterparty, the Issuer will be treated as a general creditor of such Synthetic Counterparty, and will not have any claim with respect to the Reference Obligation.
However, as a result of the terms of the Synthetic Security and the assumption of the credit risk of the applicable Synthetic Counterparty, a Synthetic Security may have a different expected return, a different (and potentially greater) probability of default, a different (and potentially greater) expected loss characteristic following a default and a different (and potentially lower) expected recovery following default.
Although the Investment Manager will not perform independent credit analyses of the Synthetic Counterparties on behalf of the Issuer, any such Synthetic Counterparty, or an entity guaranteeing such Synthetic Counterparty, individually and in the aggregate will be required to satisfy the applicable Rating Requirement thereto.