Home > Term: negative pledge clause
negative pledge clause
Promise made by the borrower in writing to the creditor not to pledge any assets in favour of third parties (securities, goods, claims, etc.) without the agreement of the creditor. This clause is also applied when issuing bonds. Here, the issuer undertakes to his/her creditors not to pledge assets in favour of third parties. See also negative mortgage clause.
- Part of Speech: noun
- Industry/Domain: Banking
- Category: Investment banking
- Company: UBS
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- Stefan K
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