Section 659 | Transfers with or without accrued interest: interest in default

(1)This section applies if—

(a)the amount of the payments treated as made on a transfer of securities is to be determined under section 632(4) or (5), 633(5) or 662(4) (cases where interest is not accounted for separately),

(b)there has been a failure to pay interest due on the securities, and

(c)as a result of the failure, on the interest payment day which is or follows the settlement day the value of the right to receive the interest payable on the securities is less than the interest payable.

(2)The calculation under section 632(4) or (5), 633(5) or 662(4) is to be made by reference to that value instead of the interest.