LSTA’s Revised Trading Documents Allow Revolver Loan Investors to Protect Their Posted Collateral — But Only If They Ask
The authors discuss the 2013 revisions to the LSTA Collateral Annex and trade documents, which aim to reduce investors’ exposure to a lender’s insolvency risk in revolving loan participations by improving collateral protections. They explain how prior practices—especially the commingling of collateral—left buyers vulnerable as unsecured creditors while still obligated to fund future draws.
