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Margin Lending Agreement Template for Switzerland

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Key Requirements PROMPT example:

Margin Lending Agreement

"I need a Margin Lending Agreement under Swiss law for our bank to provide a CHF 5 million facility to an institutional client, with standard margin requirements and specific provisions for cryptocurrency collateral."

Document background
The Margin Lending Agreement is a crucial document used in Swiss financial markets when a financial institution extends credit to clients against their securities portfolio. This sophisticated financing arrangement allows borrowers to access liquidity while maintaining their investment positions, subject to strict margin requirements and regulatory oversight. The agreement must comply with Swiss financial regulations, including the Financial Services Act (FinSA), Financial Institutions Act (FinIA), and relevant banking laws. It details the lending relationship, collateral arrangements, margin maintenance requirements, and default procedures. The document is particularly important in Switzerland's well-developed financial services sector, where margin lending is a common practice among banks, investment firms, and their institutional and private clients. The agreement includes comprehensive risk management provisions and reflects Switzerland's robust regulatory framework for financial services and investor protection.
Suggested Sections

1. Parties: Identification of the lender and borrower with full legal names and addresses

2. Background: Context of the agreement and general purpose of the margin lending facility

3. Definitions and Interpretation: Detailed definitions of terms used throughout the agreement and rules of interpretation

4. Facility and Purpose: Details of the margin lending facility, including amount, purpose, and any sub-facilities

5. Conditions Precedent: Conditions that must be satisfied before the facility becomes available

6. Margin Requirements: Calculation of margin requirements, maintenance margin levels, and margin calls

7. Collateral Arrangements: Types of eligible collateral, valuation methods, and custody arrangements

8. Interest and Fees: Interest calculation, payment terms, and applicable fees

9. Representations and Warranties: Standard and specific representations and warranties from the borrower

10. Covenants: Positive and negative obligations of the borrower during the facility period

11. Events of Default: Circumstances constituting default and consequences thereof

12. Enforcement Rights: Lender's rights and remedies upon default, including collateral liquidation

13. Payment Mechanics: Details of payment procedures, currencies, and settlement arrangements

14. Changes to Parties: Rules regarding assignment, transfer, and delegation of rights and obligations

15. Notices: Communication methods and contact details for formal notices

16. Governing Law and Jurisdiction: Confirmation of Swiss law governance and jurisdiction arrangements

Optional Sections

1. Multi-currency Provisions: Required if the facility allows for multiple currencies, including exchange rate mechanisms and currency-specific margins

2. Electronic Trading Platform: Include if margin lending is linked to a specific trading platform, detailing access and operational procedures

3. Additional Security Arrangements: Required if additional forms of security beyond standard collateral are provided

4. Client Classification: Include for retail clients, addressing FinSA requirements and consumer protection measures

5. Additional Services: Include if additional services such as advisory or portfolio management are provided alongside margin lending

6. Tax Provisions: Detailed tax clauses required for cross-border arrangements or specific tax situations

7. Force Majeure: Extended force majeure provisions for agreements with specific market sensitivity

Suggested Schedules

1. Schedule 1 - Facility Terms: Detailed commercial terms including facility limits, interest rates, and fees

2. Schedule 2 - Eligible Collateral: List of acceptable collateral types and their respective margin requirements

3. Schedule 3 - Margin Calculations: Detailed methodology for calculating margin requirements and trigger levels

4. Schedule 4 - Form of Margin Call Notice: Standard template for margin call notifications

5. Schedule 5 - Account Details: Banking and custody account details for both parties

6. Appendix A - Risk Disclosure: Required risk disclosures under FinSA

7. Appendix B - Fee Schedule: Detailed breakdown of all applicable fees and charges

8. Appendix C - Compliance Documents: Required regulatory forms and compliance declarations

Authors

Alex Denne

Head of Growth (Open Source Law) @ ¶¶Òõ¶ÌÊÓÆµ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions



























































Clauses






























Relevant Industries

Banking

Financial Services

Investment Management

Wealth Management

Securities Trading

Private Banking

Asset Management

Brokerage Services

Investment Banking

Retail Banking

Relevant Teams

Legal

Compliance

Risk Management

Credit

Trading

Operations

Client Services

Wealth Management

Portfolio Management

Treasury

Financial Advisory

Collateral Management

Documentation

Investment Advisory

Relationship Management

Relevant Roles

Relationship Manager

Credit Officer

Compliance Officer

Legal Counsel

Risk Manager

Portfolio Manager

Trading Director

Wealth Manager

Operations Manager

Client Service Manager

Financial Advisor

Credit Risk Analyst

Collateral Manager

Treasury Manager

Investment Consultant

Industries








Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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