Authors: Andrew Payne, Evan Lam

The application of insolvency clawbacks to derivatives and financing transactions:

The provision of collateral as credit support is common in derivatives and financing transactions. An issue of concern to banks and other credit providers taking collateral is what would happen when the collateral provider goes insolvent or was nearing insolvency when the collateral was provided. In Singapore, where a company is in judicial management or is being wound up, certain transactions may be set aside or voided on the grounds set out in the Insolvency, Restructuring and Dissolution Act 2018 of Singapore.