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Syndication loans are a type of loan business or credit business that two or more banks form a banking group under the leadership of one or several banks, and jointly provide loans or credit lines to borrower through the same agent bank under the same loan terms, according to the same loan agreement, according to their respective proportion.
Features of Syndicated Loans
1、Multiple lenders sign a loan agreement with the same borrower.
2、For a joint loan, each bank signs a loan agreement with the borrower separately.
Independence of Lender
The participating banks of the banking group undertake the obligations of granting loans according to the proportion they undertake, and undertake the risk of the loan independently.
Proportional Sharing
The participating banks undertake the obligations of granting loans according to the proportion they undertake, and share the borrowers’ repayments according to their proportion of participation.
Trust and Agency
After signing syndicated loan documents, the banking group’s day-to-day operations are undertaken by the agent bank.
Complex Structure
The process of syndicated loan is complex, and the signing documents need more specialized knowledge and rich experience.
1、It satisfies enterprises' large-amount and long-term fund demands.
2、It saves the trouble of repeatedly negotiating with different banks, shortens financing time, forms a market-driven loan interest rate, and reduces interest rate burden.
3、Loans in various forms.
CMB Head Office’s strategic customers that have cross-border operations or international business development needs, large business groups, high-quality mid-sized group customers. The members of cross-border groups use the loan for a specified purpose, have a bona fide business background, and the use of loan should be related to the overall operation of the group.