Outstanding dividends should be included in exposure figures because they represent an exposure risk from market pay date until payment is made to the beneficial counterparty of the loan transaction. If dividends are not paid on Pay Date, the beneficial counterparty retains the right to request collateral from the recipient counterparty if the exposure is deemed unacceptable. If collateral is required, dividends should be included on Pay Date +4 (PD/PD+1 as the days to generate the claims & PD+2/+3; as the days to perform payments, reconciliations & matching). During periods of high volume, flexibility should be expected as more time may be required to match all claims & process all the payments. (IBP-186 AGREED IN 2017)
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