Asset Covered Securities Act, 2001
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Use of realised proceeds of cover asset by designated public credit institution. |
51.—(1) A designated public credit institution may, with the prior consent of the cover-assets monitor concerned, use the proceeds of a cover asset that has been realised— | |
(a) to create or acquire permitted public credit assets or substitution assets for inclusion in the relevant cover assets pool, or | ||
(b) to discharge secured claims. | ||
(2) Subsection (1) applies even if— | ||
(a) the institution is subject to an insolvency process, or | ||
(b) the institution has been given a notice of the kind referred to in section 50 (5)(e). | ||
(3) Money received by a designated public credit institution as the proceeds of realising a cover asset forms part of the relevant cover assets pool, and is to be treated as part of the related public credit asset or related substitution asset, until it— | ||
(a) is used in accordance with subsection (1), | ||
(b) is released from that pool as an underlying asset and is replaced by other public credit assets or substitution assets that are included in the cover assets pool in accordance with section 50 or this section, or | ||
(c) is released from that pool under subsection (4). | ||
(4) A designated public credit institution may, with the prior consent of the cover-assets monitor concerned, release underlying assets (including money received by the institution as the proceeds of a cover asset) from the cover assets pool if the assets are not required by this Chapter to be included in the cover assets pool to secure secured claims. | ||
(5) In this section— | ||
“permitted”, in relation to public credit assets or substitution assets, means public credit assets or substitution assets that are permitted to be included in a cover assets pool in accordance with this Chapter; | ||
“secured claim” means a claim that is secured under Part 7 in respect of a preferred creditor. |