Negative interest rates: reflections on the role of formulae in contracts

Negative interest rates: reflections on the role of formulae in contracts

Simon Salzedo QC from Brick Court Chambers, and Varoon Saccaram, Senior Consultant at EY, examine the recent Court of Appeal decision in Netherlands v Deutsche Bank AG [2019] EWCA Civ 771 which determined that an interest rate defined in the ISDA Master Agreement could not be negative. This decision illustrates a problem that has regularly arisen when a prose definition does not express all the possible outcomes with mathematical precision. A possible solution is for drafting teams to include logical or mathematical expertise to view matters from a different angle to that of the lawyers.

Click here to read article. 

JIBFL_2020_vol35_Issue_1_Jan_OFC

 

Related Articles:
Latest Articles:
About the author:

Miranda is a solicitor specialising in leveraged and acquisition finance. She trained at Hogan Lovells International LLP and qualified into the international banking and finance team. During her time at Hogan Lovells she worked on a variety of domestic and cross-border transactions, acting for both borrowers and lenders. She also experienced secondments to Barclays Bank PLC and Kaupthing Bank hf.