Generally, a loss event in which a debtor is unable to meet the creditor’s claims arising from the granting of a loan (an occurrence such as a debt default or bankruptcy that will affect the payoff on a credit and leaves the obligor unable to meet its financial obligations). – As defined by the International Swaps and Derivatives Association (ISDA), one of the following events alone or in combination: – insolvency and inability to pay (bankruptcy), – early maturity of an obligation due to a circumstance not inherent in the obligation itself (obligation acceleration), – default of an obligation due to a circumstance not inherent in the obligation itself (obligation default), – failure to pay, – repudiation of the obligation (DE JURE or DE FACTO repudiation) – postponement of payment (moratorium) and – restructuring of the obligation (restructuring). – See arrangement, default, crash, credit loan, revoked, default swap, default, delinquent, third maturity clause, third default clause, collection, intercreditor agreement, loan defaults, lending ground rule, bankruptcy vulture, rollover, risk profile, delinquency rate, solvency risk, sovereign debt, denied, default. – See BaFin Annual Report 2006, p. 70 (model for determining credit event in relation to price risk contained in net interest rate positions), p. 132 (investments in [mixed] portfolios of NPLs).
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