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Consultation on syndicated loans
 
1. Overview
A syndicated loan describes an activity in which two or more authorized banks or non-banking financial institutions provide the borrower (via a correspondent bank) with a loan or credit in the local or foreign currency at an agreed time and amount under the same loan terms. A bank can separately or jointly serve as the lead, participating or correspondent bank for a syndicated loan. As requested, CMB offers a full range of value-added services including consultation, inquiries and document drafting for syndicated loan borrowers during the bank consortium preparation and financing stages.

2. Target customers
Syndicate loans are generally suitable for customers involved in projects that require large amounts of financing for infrastructure construction in sectors such as transport and energy, or single customers for projects that require simultaneous financing from multiple banks.
The Directive on Syndicated Loans issued by the CBRC encourages syndicate loans in any of the following circumstances:
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    Financing for a large group or project and a high amount of liquid funds;
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    The total financing for a single company or project exceeds 10 percent of the lender’s capital balance;
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    The total credit for a single customer exceeds 15 percent of the lender’s capital balance;
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    The borrower obtains financing from a bank through competitive negotiations.
3. Service description
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    As requested by the borrower, conducting pre-loan due diligence of the lender, drafting a Syndicated Loan Financing Proposal, and negotiating the objectives of forming a bank consortium with the borrower;
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    Drafting and sending a Memorandum of the Syndicated Loan to potential lenders;
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    Conducting a market test to preliminarily determine the loan terms and financial structure including the loan rate, method and term, and to specify the scope of invited lenders;
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    Maintaining contact with intermediary agencies and leading the drafting process for legal documents such as the Letter of Invitation for Syndicated Loans, List of Loan Terms and Conditions and Syndicated Loan Agreement;
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    Assisting the borrower to launch a syndicated loan roadshow;
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    Prompting potential lenders to approve loans;
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    Participating in the syndicated loan negotiation and preparing a bank consortium;
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    Assisting the borrower to designate the lead bank and correspondent bank, and sign a series of bank consortium agreements.
4. CMB's advantages

Professional team: Experienced in the syndicated loan business, CMB’s team of professionals offers customized services, helping customers ease fund-raising burdens and reduce financing risks.

Resource consolidation: Backed by its strong relationships in a wide range of sectors, CMB can consolidate resources, enabling customers to expand their businesses and fortify their market position.

Continued assurance: CMB reassures customers with strong and continuous service support.

Note:
All the contents stated above are for your reference only. Please consult the local branch of China Merchants Bank for further information. China Merchants Bank reserves the ultimate right of interpretation for the contents in this page.