Chinese counterparties challenge collateral

| BY

clpstaff &clp articles

Chinese banks and corporates are challenging collateral requirements demanded by foreign counterparties. Foreign banks need to reconsider their approach…

Chinese banks and corporates are challenging collateral requirements demanded by foreign counterparties. Foreign banks need to reconsider their approach if they want to develop their China desk.

The financial crisis encouraged counterparties to question the collateral they typically posted as, when a counterparty such as Lehman defaulted, companies that held a derivatives contract with that party found that they became unsecured creditors.

This premium content is reserved for
China Law & Practice Subscribers.

  • A database of over 3,000 essential documents including key PRC legislation translated into English
  • A choice of newsletters to alert you to changes affecting your business including sector specific updates
  • Premium access to the mobile optimized site for timely analysis that guides you through China's ever-changing business environment
For enterprise-wide or corporate enquiries, please contact our experienced Sales Professionals at +44 (0)203 868 7546 or [email protected]