Page 159 - PRIAA Glossary

SUBPRIME
The term used for lending to borrowers at a rate higher
than the prime interest rate, reflecting their higher risk of default. Subprime borrowers typically have low credit scores due to prior bankruptcy, missed loan payments, home repossession and similar occurrences.
SUCCESSION EVENT
Used in the 2003 ISDA credit derivatives definitions, an event, such as a merger, demerger, amalgamation or transfer,
that changes the legal structure of a reference entity under
a credit derivative transaction which may result in the original reference entity specified in the credit derivatives transaction being replaced by one/several new reference entities under the successor provisions. The ISDA Credit Derivatives Determination Committees now determine whether a succession event has occurred.
SUEZMAX
A tanker that is able to transport approximately one million barrels of crude oil and weighs approximately 120,000 to 200,000 deadweight tons.
SUPER SENIOR
The most senior tranche of a collateralised debt obligation (CDO). The super senior is the last tranche to absorb portfolio losses-due-to-default, after all the other tranches in the CDO capital structure have been completely written down.
SWAP
1) A derivative where two counterparties exchange streams of cash flows. These streams are known as the legs of the swap and are calculated by reference to a notional amount.
2) Under the Dodd-Frank Act, a swap has been interpreted as having broader definition to incorporate all over-the- counter (OTC) derivatives.
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