Section 624: Transfers without accrued interest
1825.This section explains when securities are transferred “without accrued interest”. It is based on section 711(5) and (6) of ICTA.
1826.Generally, a transfer is without accrued interest when the right to interest payable at the next payment date is kept by the transferor, regardless of when in the interest period the transfer took place. The transferor gets a lower price for the securities to reflect the interest accruing after the transfer which is not received by the transferee. Certain transfers are deemed to be without accrued interest.
1827.Similarly to section 623, subsection (5) makes the section subject to section 626, which provides that variable rate securities are not treated as transferred without accrued interest.
