Equivalent Collateral | Practical Law

Equivalent Collateral | Practical Law

Equivalent Collateral

Equivalent Collateral

Practical Law Glossary Item 0-386-4132 (Approx. 2 pages)

Glossary

Equivalent Collateral

Collateral of identical type, nominal value, description, and amount to collateral posted by a pledgor to the secured party. A secured party is typically permitted to return equivalent collateral to a pledgor if the secured party is permitted to rehypothecate the original collateral to a third party and the original collateral is therefore unavailable for return to the pledgor on satisfaction of its obligations to the secured party.