Waterfall - Revision history

Doug: Remove surplus link.

2024-10-05T04:05:02Z

Remove surplus link.

← Older revision		Revision as of 04:05, 5 October 2024
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	* [[Insolvency waterfall]]		* [[Insolvency waterfall]]
	* [[Junior debt]]		* [[Junior debt]]
	* [[LIBOR]]
	* [[Liquidation]]		* [[Liquidation]]
	* [[Preference]]		* [[Preference]]
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	[[Category:Accounting,_tax_and_regulation]]		[[Category:Accounting,_tax_and_regulation]]
	[[Category:~~The_business_context~~]]		[[Category:Financial_products_and_markets]]
	[[Category:Identify_and_assess_risks]]		[[Category:Identify_and_assess_risks]]
	[[Category:Manage_risks]]		[[Category:Manage_risks]]
	[[Category:Risk_frameworks]]		[[Category:Risk_frameworks]]
	[[Category:~~Cash_management]]~~		[[Category:The_business_context]]
	~~[[Category:Financial_products_and_markets]]~~
	~~[[Category:Liquidity_management~~]]

imported>Doug Williamson: Add links.

2023-04-23T14:10:12Z

Add links.

← Older revision		Revision as of 14:10, 23 April 2023
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	#Connected unsecured creditors		#Connected unsecured creditors
	#Shareholders		#Shareholders


			Sometimes known as an ''insolvency waterfall''.


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	* [[Floating charge]]		* [[Floating charge]]
	* [[Funding stack]]		* [[Funding stack]]
			* [[Insolvency waterfall]]
	* [[Junior debt]]		* [[Junior debt]]
	* [[LIBOR]]		* [[LIBOR]]
	* [[Liquidation]]		* [[Liquidation]]
	* [[Preference]]		* [[Preference]]
			* [[Preferential]]
	* [[Preferential creditor]]		* [[Preferential creditor]]
	* [[Risk-free rates]]		* [[Risk-free rates]]

imported>Doug Williamson: Update for LIBOR transition.

2022-04-25T21:11:20Z

Update for LIBOR transition.

← Older revision		Revision as of 21:11, 25 April 2022
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	Abbreviation for ''waterfall methodology''.		Abbreviation for ''waterfall methodology''.


	~~:<span style="color:#4B0082">'''''Uniform determination methodology'''''</span>~~

	:From mid-2018 a new, uniform determination methodology, the “waterfall methodology”, by which each contributing bank calculates the rates it submits, was progressively introduced. The underlying interest - the market or economic reality that the benchmark seeks to measure - remains the same.

	~~:The “waterfall” methodology refers to the three bases for a bank’s rate submission... the first practical method being used in any case according to the information available...~~

	~~:The three bases in the LIBOR waterfall are:~~

	~~:Level 1: Transaction-based~~

	~~:Level 2: Transaction-derived~~

	~~:Level 3: Expert judgement~~


	:In summary, the new methodology is more rooted in actual transactions as far as possible. Using less “judgement” that can involve a (possibly unconscious) element of “smoothing”, contributed rates are expected to vary up and down more by small amounts each day. And, recognising the reality that banks short-term-fund in the wider money-markets now, rather just inter-bank, the range of transactions considered is being widened and this can mean small rate differences.

	:Following the successful completion of the transition period, LIBOR is now, for each currency/maturity combination, the rate output as the arithmetic mean of the relevant panel banks’ waterfall-methodology based submissions, excluding the highest and lowest quartile of submissions.

	~~:''The Treasurer's Wiki - LIBOR.''~~

imported>Doug Williamson: Add priority ordering in liquidation.

2021-05-29T02:11:58Z

Add priority ordering in liquidation.

← Older revision		Revision as of 02:11, 29 May 2021
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	The priority order of claims in a liquidation.		The priority order of claims in a liquidation.

			Broadly speaking, this priority order is:

			#Secured creditors
			#Preferential creditors
			#Fixed charge creditors
			#Floating charge creditors
			#Unsecured creditors
			#Connected unsecured creditors
			#Shareholders


			Breaching this ordering is a ''preference'', that can be effectively reversed by an order of the court.


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	== See also ==		== See also ==
	* [[Agile]]		* [[Agile]]
			* [[Connected company]]
			* [[Connected person]]
			* [[Court]]
			* [[Creditors]]
	* [[Equity]]		* [[Equity]]
	* [[Fallback]]		* [[Fallback]]
			* [[Fixed charge]]
			* [[Floating charge]]
	* [[Funding stack]]		* [[Funding stack]]
	* [[Junior debt]]		* [[Junior debt]]
	* [[LIBOR]]		* [[LIBOR]]
	* [[Liquidation]]		* [[Liquidation]]
			* [[Preference]]
	* [[Preferential creditor]]		* [[Preferential creditor]]
	* [[Risk-free rates]]		* [[Risk-free rates]]
			* [[Secured creditor]]
			* [[Security]]
	* [[Senior debt]]		* [[Senior debt]]
	* [[Seniority]]		* [[Seniority]]
	* [[Subordinated debt]]		* [[Subordinated debt]]
			* [[Unsecured debt]]
	* [[Valuation]]		* [[Valuation]]
	* [[Waterfall methodology]]		* [[Waterfall methodology]]

imported>Doug Williamson: Add link.

2021-05-27T09:48:02Z

Add link.

← Older revision		Revision as of 09:48, 27 May 2021
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	* [[Agile]]		* [[Agile]]
	* [[Equity]]		* [[Equity]]
			* [[Fallback]]
	* [[Funding stack]]		* [[Funding stack]]
	* [[Junior debt]]		* [[Junior debt]]

imported>Doug Williamson: Add link.

2021-05-27T08:55:59Z

Add link.

← Older revision		Revision as of 08:55, 27 May 2021
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	* [[Subordinated debt]]		* [[Subordinated debt]]
	* [[Valuation]]		* [[Valuation]]
			* [[Waterfall methodology]]

	[[Category:Accounting,_tax_and_regulation]]		[[Category:Accounting,_tax_and_regulation]]

imported>Doug Williamson: Layout.

2021-05-27T08:40:53Z

Layout.

← Older revision		Revision as of 08:40, 27 May 2021
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	Abbreviation for ''waterfall methodology''.		Abbreviation for ''waterfall methodology''.

	~~[title + house style for quote]~~

	~~From mid-2018 a new, uniform~~ determination methodology, the “waterfall methodology”, by which each contributing bank calculates the rates it submits, was progressively introduced. The underlying interest - the market or economic reality that the benchmark seeks to measure - remains the same.		:<span style="color:#4B0082">'''''Uniform determination methodology'''''</span>

	~~The “waterfall”~~ methodology ~~refers to~~ the ~~three bases for a bank’s rate submission..~~. the ~~first practical method being used in any case according~~ to the ~~information available..~~.		:From mid-2018 a new, uniform determination methodology, the “waterfall methodology”, by which each contributing bank calculates the rates it submits, was progressively introduced. The underlying interest - the market or economic reality that the benchmark seeks to measure - remains the same.

	The three bases in the ~~LIBOR waterfall are:~~		:The “waterfall” methodology refers to the three bases for a bank’s rate submission... the first practical method being used in any case according to the information available...

	~~Level 1~~: ~~Transaction-based~~		:The three bases in the LIBOR waterfall are:
	~~Level 2~~: ~~Transaction-derived~~
	~~Level 3: Expert judgement~~

			:Level 1: Transaction-based

	In summary, the new methodology is more rooted in actual transactions as far as possible. Using less “judgement” that can involve a (possibly unconscious) element of “smoothing”, contributed rates are expected to vary up and down more by small amounts each day. And, recognising the reality that banks short-~~term-fund in the wider money-markets now, rather just inter-bank, the range of transactions considered is being widened and this can mean small rate differences.~~		:Level 2: Transaction-derived

	Following the successful completion of the transition period, LIBOR is now, for each currency/maturity combination, the rate output as the arithmetic mean of the relevant panel banks’ waterfall-methodology based submissions, excluding the highest and lowest quartile of submissions.		:Level 3: Expert judgement

	''The Treasurer's Wiki - LIBOR.''
			:In summary, the new methodology is more rooted in actual transactions as far as possible. Using less “judgement” that can involve a (possibly unconscious) element of “smoothing”, contributed rates are expected to vary up and down more by small amounts each day. And, recognising the reality that banks short-term-fund in the wider money-markets now, rather just inter-bank, the range of transactions considered is being widened and this can mean small rate differences.

			:Following the successful completion of the transition period, LIBOR is now, for each currency/maturity combination, the rate output as the arithmetic mean of the relevant panel banks’ waterfall-methodology based submissions, excluding the highest and lowest quartile of submissions.

			:''The Treasurer's Wiki - LIBOR.''

imported>Doug Williamson: Add quote. Source: LIBOR page.

2021-05-27T08:29:38Z

Add quote. Source: LIBOR page.

← Older revision		Revision as of 08:29, 27 May 2021
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	Abbreviation for ''waterfall methodology''.		Abbreviation for ''waterfall methodology''.

			[title + house style for quote]

			From mid-2018 a new, uniform determination methodology, the “waterfall methodology”, by which each contributing bank calculates the rates it submits, was progressively introduced. The underlying interest - the market or economic reality that the benchmark seeks to measure - remains the same.

			The “waterfall” methodology refers to the three bases for a bank’s rate submission... the first practical method being used in any case according to the information available...

			The three bases in the LIBOR waterfall are:

			Level 1: Transaction-based
			Level 2: Transaction-derived
			Level 3: Expert judgement


			In summary, the new methodology is more rooted in actual transactions as far as possible. Using less “judgement” that can involve a (possibly unconscious) element of “smoothing”, contributed rates are expected to vary up and down more by small amounts each day. And, recognising the reality that banks short-term-fund in the wider money-markets now, rather just inter-bank, the range of transactions considered is being widened and this can mean small rate differences.

			Following the successful completion of the transition period, LIBOR is now, for each currency/maturity combination, the rate output as the arithmetic mean of the relevant panel banks’ waterfall-methodology based submissions, excluding the highest and lowest quartile of submissions.

			''The Treasurer's Wiki - LIBOR.''

imported>Doug Williamson: Add valuation context to 4th defnition.

2021-05-27T08:11:27Z

Add valuation context to 4th defnition.

← Older revision		Revision as of 08:11, 27 May 2021
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	4. ''Risk-free rates.''		4. ''Risk-free rates - valuation.''

	Abbreviation for ''waterfall methodology''.		Abbreviation for ''waterfall methodology''.
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	* [[Seniority]]		* [[Seniority]]
	* [[Subordinated debt]]		* [[Subordinated debt]]
			* [[Valuation]]

	[[Category:Accounting,_tax_and_regulation]]		[[Category:Accounting,_tax_and_regulation]]

imported>Doug Williamson: Add links.

2021-05-27T08:10:32Z

Add links.

← Older revision		Revision as of 08:10, 27 May 2021
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	== See also ==		== See also ==
			* [[Agile]]
	* [[Equity]]		* [[Equity]]
	* [[Funding stack]]		* [[Funding stack]]
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	* [[Risk-free rates]]		* [[Risk-free rates]]
	* [[Senior debt]]		* [[Senior debt]]
			* [[Seniority]]
	* [[Subordinated debt]]		* [[Subordinated debt]]