No Negative Interest For Netherlands

There may be such a thing as bad publicity, but there is no negative interest – at least, as would be payable under an unamended ISDA 1995 Credit Support Annex ("1995 CSA").

So held the English Commercial Court in a case¹ brought by the Netherlands (the "State") against Deutsche Bank AG (the "Bank"). In a judgment of 25 July 2018, Robin Knowles J determined that the standard form English law 1995 CSA does not contemplate a legal obligation to account for negative interest.

Negative rates environment

Over the past years the European Central Bank and the central banks of Sweden, Switzerland, Denmark and Japan cut interest rates to levels below zero, and various instances of negative EURIBOR, EONIA and LIBOR rates have occurred.