Art. 102

(Art. 110 FinMIA)

1. No reciprocal offsetting may apply to initial margins.
2. Initial margins paid in cash must be held with a central bank or a Swiss bank independent of the paying counterparty or an independent foreign bank subject to appropriate regulation and supervision.
3. Initial margins not paid in cash may be held by the receiving counterparty or by a third party mandated by the counterparty. The third party may be the paying counterparty.
4. The use of initial margins for other purposes is not permissible. This does not apply to the reutilisation of initial margins paid in cash by a custodial third party, provided it is contractually ensured that the reutilisation does not adversely affect the security and its usability.
5. The receiving counterparty and the custodial third party must keep the non-cash initial margins received separate from their own assets and conclude a segregation agreement. This shall prescribe in particular that:
   1. the initial margin payment should be immediately available to the receiving counterparty in the event of bankruptcy or default on the part of the other counterparty; and
   2. the counterparty making the initial margin payment should be sufficiently hedged against the possibility of bankruptcy or default on the part of the receiving party or the custodial third party.