loan syndication


Also found in: Financial.

loan syndication

lending by a group. The size of some loans is so large that no single financial institution would possess either the resources or the inclination to lend the entire sum on its own. In such cases a syndicate of institutions is formed to provide the necessary funding. The syndication process starts when either a borrower approaches a bank and invites it to initiate arrangements for a syndication facility or when the bank itself approaches a corporate borrower that it believes is seeking funds. The bank (known as the managing bank) will then:
  1. (1) settle in outline with the company the financial and other terms on the basis of which the loan is to be promoted;
  2. (2) approach prospective lenders in the market and provide them with details of the proposed loan and information about the borrowers in order to enable a judgment to be made as to whether or not to participate; and
  3. (3) negotiate the details of the loan agreement with the borrower. Loan syndications, therefore, comprise two distinct sets of agreements: those governing the formation of and participation in the syndicate and those governing the relationship between the syndicate and the borrower, in effect, the loan agreement itself.
References in periodicals archive ?
The company offers savings, time, foreign currency, and structured deposits; investment trust services; corporate loans; loan syndication and arrangement services; consumer finance and credit guarantees; brokerage, collection, and life and non-life insurance services; and start-up, real estate non-recourse, project, renewable energy, acquisition, ship, and healthcare financing services, as well as home mortgages and housing loans.
Moolman lauded the participating financial institutions for staying committed to MTN, stressing that the loan syndication showcased the strength of the Nigerian financial institutions and their confidence in MTN's vision, as well as both parties joint ability to stimulate significant economic growth.
We are focusing on loan syndication in partnership with our banking partners and have participated in several loan syndication by major banks.
PNB is co-financing 28.7 percent of the total allocation for the entire loan syndication worth P40 billion.
According to the BSP, 'the Monetary Board also considered that the entry of new foreign banks into the country provides additional potential funding sources, in addition to syndicated loans that may be structured by existing banks,' adding that 'loan syndication spreads the credit-risk exposure arising from big-ticket projects.'
As too common in business jargon, "syndicated loan" and "loan syndication" are not precisely defined or uniformly employed terms.
Predominantly, the firm offers loan syndication services, in addition it also offers advisory services in corporate restructurings and mergers and acquisitions.
a disciplined approach to loan syndication and credit underwriting.
National Bank of Fujairah, or NBF, announced on Thursday that NBF Capital Limited has concluded an Dh260 million loan syndication on behalf of Universal Hospital.
National Bank of Fujairah (NBF) announced today that NBF Capital Limited has concluded an AED 260 million loan syndication on behalf of Universal Hospital.
member of the World Bank Group, is investing US$20 million in Indomina, and facilitating US$ 10 million through a loan syndication in the international banking market.
His practice also focuses on loan syndication, the acquisition and disposition of commercial properties, the formation of real estate joint ventures and partnerships, debt restructurings, loan modifications and work-outs.