Preferred Creditor Research Articles

Perlindungan Hukum Bagi Kreditor Terhadap Pelunasan Piutang Dari Harta Pailit

The concept of legal protection in bankruptcy has so far been seen as a way out of the problem of accounts receivable debt which coincides with a bankrupt debtor, where the debtor no longer has the ability to repay the debts which are past due to their creditors, so that the steps to submit a request for the determination of bankruptcy status by the Court Commerce of the debtor is a possible step to resolve the bankruptcy case. Bankruptcy was originally regulated in Law Number 37 of 2004 concerning Bankruptcy and Suspension of Debt Payment Obligations (UUK and PKPU). Furthermore, if the parties submitting bankruptcy applications, the Commercial Court Judges at the District Court are required to examine and hear the case being submitted. The research method used is the normative legal research method or library research with the statute aprroach approach and the case aprroach approach. Based on the results of the study, it is known that the form of legal protection for creditors against paying off debts from bankrupt assets in the Supreme Court Decision Number 511 / K / Pdt. Yinchenindo Mining Industry (in bankruptcy) by law becomes a guarantee for its debts to preferred creditors, in this case the Head of the Second Foreign Capital Investment Service Tax Office. Furthermore, the UUK and PKPU also guarantee the rights of creditors in bankruptcy, especially the rights of preferred creditors who have a special position with peace efforts and the postponement of obligations to pay debts of bankrupt debtors to their creditors as stipulated in Article 222 of the UUK and PKPU. The concept of the distribution of bankrupt assets distributed to preferred creditors after deducting bankruptcy fees and compensation for curatorial services where the payment process is settled based on the principle of fairness and balance set forth in Article 265 of the UUK and PKPU, where the preferred creditor parties receive the remaining payment of the receivables amounting to 62.5% ( sixty two point five percent) of the bankruptcy assets.It is expected that the Judges of the Commercial Court and the Court of Appeals at the Supreme Court consider the rights of preferred creditors who pay off their receivables first. The Debtor should be able to immediately submit a request to postpone the debt payment obligation so that the remaining outstanding debt receivables cannot be paid off to the preferred creditors through the sale of free assets. Keywords: Protections of the law, creditor, Treasures of starc

Legal Protection for Creditor in the Online Registration of Fiducairy Guarantee in Consumen Finance

The existence of online fiduciary guarantee registration in consumer finance will be very efficient. Online legal services surely ease the applicants, notaries, and those who works in the field of law[1]. Nonetheless, online fiduciary registration still has weakness which harms the legal protection of creditor. The main problem is on the Fiduciary Guarantee Certificate, since the certificate is the creditors’ evidence as the holder of fiduciary guarantee. There are different interpretations regarding to the validity of the certificate which potentially makes problems. This research aims to discover and analyze the legal effect and legal protection for creditor in online registration of fiduciary guarantee. This research used socio legal approach, with integrate the rule of law, regulation, norm and legal principle research and the implementation of fiduciary guarantee registration online. The result of the research is: the registration of Fiduciary Guarantee is obliged to execute Fiduciary Guarantee. The electronic signs in the online certificate of Fiduciary Guarantee are valid under the law. By registering Fiduciary Guarantee online, the creditor is entitled of legal protection as preferred creditor making them the main priority to the repayment and becomes separatist creditor which does not have influence to the bankruptcy of debtor. The online registration of Fiduciary Guarantee fulfills specialty and publicity principle. The online certificate of Fiduciary Guarantee has executorial title which is equal to court verdict, making the creditor protected due to the bonding to third party and giving guarantee of legal assurance to those involved.

The Priority Distribution of Wealth the Debtor’s Bankrupt (Boedel Bankruptcy) Towards Separatist and Preferential of Creditor Based on Principles of Fairness and Legal

<p>Indonesia modern civil law development lasted to align with community life progress. In 1998 made bankruptcy laws reform of colonial legacy, which was revised in 2004 by Law No. 37. Additionally, the bankruptcy law instruments sourced on the Civil Code and some other provisions. After the court decision on bankruptcy declaration, bankruptcy process was arrangement and distribution of wealth the debtor’s bankrupt (boedel bankruptcy) by curator. So far, the difficulty legal curator instrument cared and settled bankruptcy estate. The prioritization of splitting on the preference and separatist creditor. This research was classified as a normative legal research. Basically, the research based on secondary data. The research conclusion, first, completion of settlement the boedel bankruptcy arranged which reflected in a series of activities that sequence according to the stages and institutionally involve the creditor committee, curator, and the supervisory judge; second, the principles of justice that could be applied in determining the division of boedel bankruptcy to creditors, particularly the preferred and separatist creditors, namely the principle of pari passu and pro rata, the principle of balance, the principle of proportional, and the principles of fairness; third, instruments of Indonesia bankruptcy law consists of elements of civil law (Civil Code), bankruptcy law and suspension of debt payments (Act No. 37 of 2004), a variety of laws and regulations under the law, occasionally based on the policy elements. This condition reduces the level of security in the application of the law.</p><p>Keywords: bankruptcy, boedel bankruptcy, preferred creditors, separatist creditors <br /> <br /> <br /> <br /> <br /> <br /> </p>

ANALISIS YURIDIS TERHADAP AKIBAT HUKUM PUTUSAN PERNYATAAN PAILIT BAGI DEBITOR TERHADAP KREDITOR PEMEGANG HAK TANGGUNGAN

The research and discussion of the problems as outlined in this scientific work is done with the aim of knowing which legal provisions apply to the creditors holding the Mortgage Rights in the case of the decree of declaration of bankruptcy, considering there are two different legal provisions, namely Bankruptcy Law Number 37 of 2004 and Insurance Rights Act No. 4 of 1996. This research is a Yuridi Normative research. Data obtained through literature research. The purpose of library research is to obtain secondary data. Primary data obtained through library research, then the data were analyzed qualitatively. From the result of the research, it is known that the Commercial Court judge in determining the decision of bankruptcy statement based its decision on the provisions of Law No. 34 of 2004, and the judges use legal principle of lex posteriori derogate legi priori to determine which legal provisions should be applied. Thus, both the bankrupt debtor and the creditor are subject to the provisions of bankruptcy, so that the holder of the mortg who has the position of the preferred creditor can only exercise his / her right of execution of the burden of the mortgage for a period of two months after a ninety-day suspension period since the bankruptcy decision was pronounced.

Pelaksanaan Eksekusi Hak Tanggungan yang Tidak Didaftarkan Di Kantor Badan Pertanahan

The purpose of this study was to determine and analyze the fund execution of mortgages rights and legal effects arising from the execution of mortgages that are not registered to the office of land agency.The research method that used in this study was Normative legal research and Empirical law research, with the legislation approach, conceptual, and sociological. Data analysis and legal materials was done by analyzing the various regulations that specifically regulate the rights of dependents as well as analyzing the findings data on the fields that related to practice of unregistered mortgages.Based on the results of the research, the creditor can still execute mortgages that are not registered in the office of land agency, by means that there is a guarantee from Notary in the form of Covernote. The creditor refers to the Power of Attorney for Load Rights (SKMHT) which has been made with the Deed of Assignment Rights (APHT) in the presence of a Notary or PPAT, and asks PPAT to register the Mortgage Right at the Office of Land Agency, with time limit of 3 (three) month maximum.The legal consequences of the execution of an unregistered mortgage cause the creditor of the mortgage does not have the position of the preferred creditor, but the same as the position of the concurrent creditor. From the decline of the creditor's status, because it does not meet the fundamental and conditions that require mortgage rights are registered. As well as mortgage rights can coused invalidated by law.

Towards a More Efficient Use of Multilateral Development Bankss Capital

The increasing financing needs of the Sustainable Development Goals (SDGs), coupled with factors likely to restrain in the near future the growth of multilateral development banks’ (MDBs) own resources, call for maximizing capital efficiency. Focusing on 7 major MDBs – the IBRD, IFC, AfDB, EBRD, EIB, ADB and IADB – this paper contributes to this debate by: (a) quantifying their aggregate available lending capacity (capital resources and ratings being unchanged); (b) providing a preliminary estimate of the impact on these banks’ lending capacity if rating agencies (in particular, Standard and Poor’s) were to refine their methodologies to take into account ‘preferred creditor status’ and ‘single name concentration’, as suggested by other researchers. The analysis is replicated assuming that MDBs target an AA rating. The paper shows that appropriately refining rating procedures may indeed increase MDBs’ current overall lending capacity significantly, under both ‘triple-A’ and ‘AA ’ scenarios. At the same time, it makes clear that MDBs alone cannot satisfy what are anticipated to be the very substantial financing needs of SDG-related investments.

Poverty in the Developing Countries: A multifold curse

As poverty is a systematic curse that affects many macro factors of economy, policies & planning not only in developing countries but throughout the world therefore it becomes a socioeconomic issue on national & international level and requires an effective framework. The purpose of the study is to identify the reasons of poverty & implications of allocated assistance by IMF & WB in the developing countries and exploring the responsiveness of international efforts to minimize the level of poverty. World Bank (WB) in the collaboration of IMF (International Monetary Fund) works for the international goal to reduce poverty through its planning & projects, provides aids to those countries that are economically weak or they are stabilizing their performances to improve their economy and controls it by SAP (Structural Adjustments Program).However, these aids & assistance are affected by political powers, corruption and mismanagement in developing countries and mostly it could not reach to allocated area that helps poverty to sustain. The study focuses on theoretical mechanics of poverty in the light of structural adjustments program and emphasizes on the need of effective governance and state citizen relationship. The result of descriptive analysis explained that aids & assistance do not reach to the deserving one because of political vested interests and corruption or spur inequality. These aids reach optimal levels only if there will no preferred creditor notions, state will be committed & responsible and good governance will also be required to reduce poverty with the help of unanimous efforts

Multilateral Development Bank Ratings and Preferred Creditor Status

This paper analyzes influences on the credit standing of Multilateral Development Banks (MDBs), specifically the quality, diversification and single name concentration of their portfolios, and on the market practice known as Preferred Creditor Status (PCS), whereby sovereigns that default on other debt rarely fail to meet their obligations to MDBs. The paper examines how rating agencies assess MDB ratings, focusing in particular on how Standard & Poor's assesses capital as part of its MDB rating process. The results are compared with those implied by an industry-standard, ratings-based Credit Risk Model (CRM). Applying these methodologies to one specific MDB, the Inter-American Development Bank (IDB), the paper shows that S&P's approach is highly conservative in its evaluation of single name concentration risk and makes insufficient allowance for PCS. Calibrating the CRM with risk-neutral distributions, the paper examines the effect of PCS on MDB funding rates and compares model-implied funding spreads with those observed in the market.

Government Bonds Ammunitions for the ECB Quantitative Easing

The aim of this paper is to investigate a range of financial techniques and policy strategies for a Quantitative Easing (QE) program by the European Central Bank (ECB) that would rely on Euro area government bonds purchases under various modalities and guises. In particular, we provide an empirical study of different possible QE arrangements, with a special focus on a proposal of a securitization structure that could clear the different sovereign bonds from credit risk and heterogenerity. The securitization framework proposal is compared with a program of Euro-area public debt direct purchases under two alternative scenarios of: i) pari-passu creditor status of the ECB with respect to private investors; ii) preferred creditor status of the ECB. We consider three cases of “un-managed” (fixed composition) direct purchases according to which member states bonds are purchased in proportion to: i) the “capital key” representing equity holdings of ECB’s shares; ii) a “liquidity-key” representing the relative amount of sovereign bonds outstanding; iii) an equally-weighted portfolio of sovereign bonds. We evaluate the impact of various SPV characteristics - such as bond tranche attachment choice - as well as various financial market scenarios. For these choices we provide a risk management analytical framework based on Monte Carlo simulations. This allows us to compute the probability distribution of credit losses under various credit spreads and default correlation scenarios as well as to design appropriate stress testing procedures to gauge the robustness of our proposed GBB QE solutions. In this version of the paper our modelling strategy relies on the Gaussian copula assumption in default risk correlation. Using end of October 2014 CDS market quotes for 10 Euro-area sovereign bond market, as well as an estimate of a Gaussian copula measure based on historical CDS quotes time series, we conclude that the expected loss would be about 75 basis points on a 5 year horizon for a senior tranche bond with 30% attachment (that is absorbing losses on the government bond portfolio beyond 30% of its value). For all practical purpose, such expected loss and the corresponding credit spread value would be similar to the risk of the German Bund as measured at the same valuation date. As for the junior tranche bond credit risk, we reckon credit spreads between 200 and 300 basis points - depending on the underlying assumptions - which would be comparable with Portuguese government bond credit risk at the same valuation date. Our stress test analysis - based on historical data recorded in November 2011 (Euro area sovereign debt crisis acme) - shows that the securitization structure would effectively limit the credit risk increase on the senior tranche to 5-6% of expected losses estimated in our benchmark case on a 5 year horizon. As one should expect, this fairly solid protection to the senior tranche would come at the cost of a huge credit deterioration for the junior bond tranche to an expected loss level of 60%. This implication should make the junior tranche bond a financial product suitable only for sophisticated institutional investors.

Альтернативные многосторонние банки развития и глобальное финансовое управление

What will be the future impact on multilateral lending shares of the New Development Bank (NDB) and the Asian InfrastructureInvestment Bank (AIIB), two multilateral banks created in 2014 outside the established Bretton Woods system?Will these new institutions led by China and the BRICS help rebalance multilateral development finance away from westerndominance? The answer comes in three parts: first, increasing pressure for the BRICS to exit´ rises with past, present andexpected failure for ´voice´ reform in the established international financial institutions (IFIs); second, excess demand formultilateral soft loans; and, third, a quantification of the potential lending capacity by the NDB and AIIB to assess howmuch relative business - hence political influence - the existing IFIs might lose in favour of the new competitors. The NDBand AIIB combined will likely attract sufficient co-financing to rival the established multilateral development banks interms of annual lending. This article concludes that infrastructure finance will benefit from the creation of the NDB andAIIB by tapping the considerable saving potential in China and other BRICS members. The new institutions should thereforebe supported, not discouraged, by western governments and donors as well. As the new multilateral development banksintroduce choice in terms of funding cost and modalities, borrowers are well advised to join these new institutions rapidlyfor their own benefit. Competition in multilateral development banking may have a negative impact on loan enforcementmechanisms. The IFIs of the existing Bretton Woods system and the new development banks will have to unite by imposingcross-default clauses to safeguard their preferred creditor status.

The role of creditor seniority in Europe's sovereign debt crisis

The share of public debt that is held by lenders with preferred creditor status (i.e. the IMF, ECB, ESM, etc.) has increased substantially during Europe's sovereign debt crisis. Empirically, we document in both macro and survey data that there exists a close relationship between the increase in senior tranche lending and the interest rates of countries in crisis. With regard to policy implications, we point out a predicament that policymakers are facing: while aiming to stabilize interest rates at a reasonable level, providing further senior loans might achieve just the opposite, as private markets are gradually pushed into a junior position. — Sven Steinkamp and Frank Westermann

Aid securitisation: beyond IFFIm

The International Finance Facility for Immunization (IFFIm), which securitised future aid commitments by donor countries, has been quite successful in providing considerable predictable and front-loaded funding in support of immunisation programs in scores of poor countries. Since official development assistance (ODA) as well as private capital flows to poor countries is likely to remain scarce in the current financial environment, the paper evaluates the prospects of setting up IFFIm-like mechanisms to fund a broad range of development objectives. Two broad conclusions emerge. First, replicating IFFIm could prove challenging largely because donor pledges are likely to lack the desired credibility. Second, certain credit enhancements like third party guarantees, excess coverage, and channelling of pledges through a preferred creditor like the World Bank, however, could overcome this deficiency. Finally, advance market commitments (AMCs) and cash on delivery (COD) are alternatives that could be used to bring in some of the advantages of the IFFIm-like financial structures.

Regional and Global Monetary Cooperation

i»?The increasing occurrence of national, regional, and global financial crises, together with their rising costs and complexity, have increased calls for greater regional and global monetary cooperation. This is particularly necessary in light of volatile capital flow movements that can quickly transmit crisis developments in individual countries to other countries around the world. Global financial safety nets (GFSNs) are one important area for monetary cooperation. This paper reviews the current situation of regional and global monetary cooperation, focusing on financial safety nets, with a view toward developing recommendations for more effective cooperation, especially between the International Monetary Fund (IMF) and regional financial arrangements (RFAs). A GFSN should have adequate resources to deal with multiple crises, should be capable of rapid and flexible response, and should not be encumbered by historical impediments such as the IMF stigma that would limit its acceptance by recipient countries. Oversight of a GFSN needs to be based on cooperation between global and regional forums, for example, the G20 and ASEAN+3 or East Asia Summit (EAS). Such a GFSN should include the IMF and RFAs at a minimum, and it is highly recommended to find ways to include central banks as providers of swap lines and multilateral banks as well. The basic principles governing the cooperation of IMF and RFAs include rigorous and even-handed surveillance; respect of independence and decision-making processes of each institution and regional specificities; ongoing collaboration as a way to build regional capacity for crisis prevention; open sharing of information and joint missions where necessary; specialization based on comparative advantage; consistency of lending conditions and conditionality, although with flexibility; respect of the IMF as preferred creditor; subsidiarity; avoidance of moral hazard; and transparency.

Review of Fund Facilities-Analytical Basis for Fund Lending and Reform Options

In the context of the ongoing review of Fund facilities, this paper examines the analytical basis for Fund lending in emerging market countries and provides a broad-ranging perspective for reforming the General Resources Account (GRA) lending toolkit. The Fund’s important lending role in crisis prevention and resolution is buttressed by its unique characteristics: (i) its ability as a nonatomistic lender to provide large-scale financing and reduce the likelihood of a run by private creditors; (ii) its ability as a cooperative institution with near-universal membership to agree conditionality with members, thus providing national authorities with a policy commitment tool to underpin confidence and catalyze private lending; and (iii) its de facto preferred creditor status, which allows it to provide crisis financing when private creditors may be reluctant to lend.

Optimal Debt? On the Insurance Value of International Debt Flows to Developing Countries

According to reputation models of sovereign debt, the incentives to repay are proportional to the income insurance benefits provided by the access to international markets. This paper, however, documents that private net lending to developing countries exhibits a procyclical or acyclical pattern, contradicting this premise. By contrast, official debt net flows exhibit a countercyclical patter. In addition, the paper shows that (both current and past) defaults are associated with lower net debt flows. The findings suggest that, while reputation models may explain the preferred creditor status enjoyed by official lenders, they cannot account for the presence of sovereign debt markets in developing countries.

Unconditional IMF Financial Support and Investor Moral Hazard

This paper develops a simple model of international lending, and calibrates it to assess quantitatively the effects of contingent IMF financial support on the risk premiums and the crisis probability. In the model, the country borrows in both short and long term; market (coordination) failure triggers a liquidity run and inefficient default; and the IMF lends unconditionally under a preferred creditor status. The model shows that IMF financial support can help prevent a liquidity crisis without causing investor moral hazard by helping to remove a distortion-effectively subsidizing ex post short-term investors (who run for the exit) at the expense of long-term investors (who are locked in). The resulting equilibrium is welfare enhancing as both the country's borrowing costs and the likelihood of a crisis are lower. The calibration exercises suggest that IMF-induced investor moral hazard-which occurs if the IMF lends at a subsidized rate-is unlikely to be a concern in practice, particularly if the country's economic fundamentals are strong and short-term debt is small.

Unconditional IMF Financial Support and Investor Moral Hazard

This paper develops a simple model of international lending, and calibrates it to assess quantitatively the effects of contingent IMF financial support on the risk premiums and the crisis probability. In the model, the country borrows in both short and long term; market (coordination) failure triggers a liquidity run and inefficient default; and the IMF lends unconditionally under a preferred creditor status. The model shows that IMF financial support can help prevent a liquidity crisis without causing investor moral hazard by helping to remove a distortion-effectively subsidizing ex post short-term investors (who run for the exit) at the expense of long-term investors (who are locked in). The resulting equilibrium is welfare enhancing as both the country's borrowing costs and the likelihood of a crisis are lower. The calibration exercises suggest that IMF-induced investor moral hazard-which occurs if the IMF lends at a subsidized rate-is unlikely to be a concern in practice, particularly if the country's economic fundamentals are strong and short-term debt is small.

Optimal Debt? On the Insurance Value of International Debt Flows to Developing Countries

According to reputation models of sovereign debt, the incentives to repay are proportional to the income insurance benefits provided by access to international markets. This paper, however, documents that private net lending to developing countries exhibits a procyclical or acyclical pattern, contradicting this premise. By contrast, official debt net flows exhibit a countercyclical patter. In addition, the paper shows that (both current and past) defaults are associated with lower net debt flows. The findings, which are robust to various additional controls, cast doubt on the reputation view of sovereign debt markets. At the same time, they suggest that reputation may account for the success of the (implicit) preferred creditor status enjoyed by multilateral lenders.

L'article 107 de la Loi sur la faillite et les droits des différents créanciers

Section 107 of the Bankruptcy Act of Canada establishes an order of collocation of creditors in a bankruptcy which comes in conflict with the order of collocation set out in many provincial statutes, and in particular, with that set out in the Quebec Civil Code for privileges. This has resulted in numerous court debates between creditors and trustees of the bankruptcy as between different categories of creditors who have seen their rank either lowered or elevated by the application of section 107. In the first part of this article, the author examines the categories of creditors concerned by this inversion, being mainly : the landlords, the Crown and Workmen's Compensation Boards. The second part of this article focuses on conflicts between secured creditors under provincial law and preferred creditors under the Bankruptcy Act. The author emphasises the differences that evolved between Quebec case law and the case law of other provinces particularily as to the scope of application of section 107 when there is a conflict between a secured lender and a lien claimant affected by section 107, on property of the bankrupt in which the trustee in bankruptcy has little or no interest.

Seniority in International Markets: The Case of the IMF

The IMF is a preferred creditor. Introducing this in the analysis gives that too much rescuing in the future would lead to too little borrowing in the present, which is the contrary to the standard moral hazard critique. Ex-post, an IMF intervention always make the country better off. However, IMF interventions make existing creditors worse off when the country solvency and liquidity situation is either good or weak and make them better off when it is in an intermediate range. This is consistent with the empirical evidence. The possibility of a future senior intervention can make the country ex-ante better off by preventing inefficient liquidation. However, although such an intervention always makes the country ex-post better off, it might actually hurt the country ex-ante. In this case the country would be ex-ante better off by committing today not to borrow from the IMF in the future, although this promise is not time consistent.