Interest rate hedging

Heavily involved in highly publicised challenges.

Chambers UK
Banking and Finance

Our banking and finance team can help if you require legal advice on hedging documentation, whether you are looking to hedge your exposure to interest rates or to investigate whether hedging has been mis-sold. We aim to achieve legal solutions tailored to your needs.

Our team can advise on the legal documentation for a wide range of interest rate hedging including swaps, caps, floors and collars. We can also advise on the legal documentation for vanilla instruments and exotic instruments such as European, American and Bermudan.

Our lawyers are experienced in helping businesses understand the legal implications of ISDA documents as well as hedging arrangements embedded in loan agreements. We can make businesses aware of the circumstances in which hedging can be terminated and the associated risks such as break costs.

The terms of a facility agreement may require a business to hedge a loan. Our team can advise on whether a hedging strategy meets the contractual requirements in a facility agreement.

We can work with a number of our contacts who are able to advise on the economics of hedging products, such as the market price of a premium and/or the rate of various instruments.

Our team can also advise on the potential mis-selling of hedging products. Partner Rich Eldridge appeared on Panorama, Britain’s New Banking Scandal, and has been quoted in The Telegraph, The Times and The Independent in relation to the mis-selling of interest rate hedging products.

We offer expert advice on:

  • hedging documentation for working capital finance
  • hedging documentation for property finance
  • hedging documentation for acquisition finance
  • hedging documentation for project finance

Recent work highlights

New hedging

Advising on whether a cap would satisfy a contractual requirement to hedge in the terms of a £41,400,000 financing. We provided guidance on whether the terms of the Schedule to the 2002 ISDA Master Agreement would conflict with the Senior Facility Agreement.


Hedging reporting

Advising companies in a group providing self storage and operating hotels on portfolio reconciliation, dispute resolution and disclosure agreements in relation to the European Market Infrastructure Regulation.


Mis-selling

Advising on over £800 million of interest rate hedging products.

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Penningtons Manches LLP

Penningtons Manches LLP is a limited liability partnership registered in England and Wales with registered number OC311575 and is authorised and regulated by the Solicitors Regulation Authority. San Francisco is an associated office.

Penningtons Manches LLP