bigfoot12
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Post by bigfoot12 on Jun 4, 2019 12:05:23 GMT
Will the new rules requiring defaulted loans be transferred at 'fair value' rather than par mean that the QAA, which currently transfers defaulted loans at par, have to change?
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sl75
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Post by sl75 on Jun 5, 2019 9:50:04 GMT
Will the new rules requiring defaulted loans be transferred at 'fair value' rather than par mean that the QAA, which currently transfers defaulted loans at par, have to change? As I understand it, it is not just the defaulted loans transferred at par, but "defaulted loans + rights to a share of ringfenced funds in the QAA provision fund expected to cover losses on that specific loan".
If the latter component were ever to be inadequate the defaulted loans would no longer be able to be transferred (it is unclear how AC would technically acheive that, as it's not happened yet... possibly it could involve "Series 1" closing and all relevant funds tradeable loan units transferring to a "Series 2").
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zlb
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Post by zlb on Jun 5, 2019 21:10:59 GMT
Will the new rules requiring defaulted loans be transferred at 'fair value' rather than par mean that the QAA, which currently transfers defaulted loans at par, have to change? As I understand it, it is not just the defaulted loans transferred at par, but "defaulted loans + rights to a share of ringfenced funds in the QAA provision fund expected to cover losses on that specific loan".
If the latter component were ever to be inadequate the defaulted loans would no longer be able to be transferred (it is unclear how AC would technically acheive that, as it's not happened yet... possibly it could involve "Series 1" closing and all relevant funds tradeable loan units transferring to a "Series 2"). interested in where you're quoting from. Don't remember this specific detail from recent conversation. Just that the expected loss is calculated into the QAA pf.
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sl75
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Post by sl75 on Jun 6, 2019 7:02:01 GMT
As I understand it, it is not just the defaulted loans transferred at par, but "defaulted loans + rights to a share of ringfenced funds in the QAA provision fund expected to cover losses on that specific loan".
If the latter component were ever to be inadequate the defaulted loans would no longer be able to be transferred (it is unclear how AC would technically acheive that, as it's not happened yet... possibly it could involve "Series 1" closing and all relevant funds tradeable loan units transferring to a "Series 2"). interested in where you're quoting from. Don't remember this specific detail from recent conversation. Just that the expected loss is calculated into the QAA pf. Sorry for confusion from sloppy use of punctuation - I was using "" to group a single concept of what was being transferred, not intended to imply a direct quote from anywhere else...
However, it has been discussed several times before that the only reason that loan parts that would otherwise be suspended from trading could continue to be traded within the QAA was that funds within the provision fund were specifically ring-fenced to cover the expected losses resulting from that loan. This implies that whoever is deemed to be holding the loan parts at the time of a loss event is also holding a right to a share of those ringfenced funds, and therefore that as the loan units get re-allocated between different QAA investors up to several times a second, those rights also transfer with them.
Transfers of loan units between different access accounts (e.g. QAA to 90DAA) add another layer of complexity, but I don't think the details of how that's accounted for behind the scenes have been clarified.
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bigfoot12
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Post by bigfoot12 on Jun 6, 2019 7:54:15 GMT
I can't seem to find the size of the provision fund for the QAA - where is it to be found? ( chris?) |
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amphoria
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Post by amphoria on Jun 6, 2019 10:42:02 GMT
I can't seem to find the size of the provision fund for the QAA - where is it to be found? ( chris ?) It's available here but hasn't been updated since 31st Dec 2018.
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Post by gravitykillz on Jun 6, 2019 11:08:54 GMT
I can't seem to find the size of the provision fund for the QAA - where is it to be found? ( chris ?) It's available here but hasn't been updated since 31st Dec 2018. It has probably dropped quite significantly if they haven't released the figures in over 6 months ?!
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ashtondav
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Post by ashtondav on Jun 6, 2019 17:12:30 GMT
To be fair it’s just over 5 months. Hopefully they’ll update end this month.
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Post by gravitykillz on Jun 6, 2019 19:11:35 GMT
To be fair it’s just over 5 months. Hopefully they’ll update end this month. If it was last updated on new years eve and today is the 6th of June. How is that 5 months ? Anyways how often do they normally update it. I think something as important as the pf should be updated monthly at the minimum.
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Post by Ace on Jun 6, 2019 19:51:20 GMT
To be fair it’s just over 5 months. Hopefully they’ll update end this month.b If it was last updated on new years eve and today is the 6th of June. How is that 5 months ? Anyways how often do they normally update it. I think something as important as the pf should be updated monthly at the minimum. I think it's fair enough to round 5 months and 6 days to 5 months 😉
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p2pmark
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Post by p2pmark on Jun 6, 2019 19:54:07 GMT
To be fair it’s just over 5 months. Hopefully they’ll update end this month. If it was last updated on new years eve and today is the 6th of June. How is that 5 months ? ... Can I politely request that you think a little more and post a little less?
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Post by gravitykillz on Jun 6, 2019 20:13:56 GMT
Lol.ok whatever
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bigfoot12
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Post by bigfoot12 on Jun 6, 2019 21:32:01 GMT
As I understand it, it is not just the defaulted loans transferred at par, but "defaulted loans + rights to a share of ringfenced funds in the QAA provision fund expected to cover losses on that specific loan". What do you mean by ringfenced? I don't see anything suggesting that the QAA provision fund is sub-allocated. Nor do I see that current defaults are favoured over future defaults. The provision fund isn't large enough to cover currently suspended loans, and whilst it might be large enough to more than cover likely losses given default, I don't think that those suspended loans should be transferred at par, at least not from December.
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bg
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Post by bg on Jun 7, 2019 5:05:39 GMT
As I understand it, it is not just the defaulted loans transferred at par, but "defaulted loans + rights to a share of ringfenced funds in the QAA provision fund expected to cover losses on that specific loan". What do you mean by ringfenced? I don't see anything suggesting that the QAA provision fund is sub-allocated. Nor do I see that current defaults are favoured over future defaults. The provision fund isn't large enough to cover currently suspended loans, and whilst it might be large enough to more than cover likely losses given default, I don't think that those suspended loans should be transferred at par, at least not from December. The ringfencing is explained here
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