Product Profile

Risk participation business cooperation refers to the business cooperation mode that financial institutions and CMB participate in the risk asset business, each taking partial or full risk and gaining respective income according to the conditions agreed beforehand.  Risk participation business includes syndicated loans, joint loans, credit asset transfer, forfaiting, and risk participation that provides credit support.  

Syndicated loans: A large loan in which a group of banks provide funds for a borrower using a same loan agreement. There is usually a lead bank or group of banks that takes a percentage of the loan and syndicates or sells the rest to other banks. CMB can act as a lead bank, an arranger, or an agent in such business.

Joint loans: CMB together with other banks provide fund for a same project, each bank signing the respective loan agreement with the borrower.

Credit fund transfer: See also the section of credit fund transfer.

Forfaiting: CMB purchases receivables from exporters without recourse in order to provide trading finance service.

Product Advantages

ü       Improve asset-liability structure.

ü      Satisfy customers’ individual demand.

ü      Various cooperation forms.

Service Flow

Service flow of forfaiting:

(1) Referring to receivables from exporters, CMB carries on quotation and inquiry and reaches trading intention with other financial institutions.

(2) The commercial bills buyers conduct business examination (L/C clauses examination and credit line examination).

(3) Confirm the quotation and sign the trading agreement.

(4) The commercial bills sellers submit the document to the buyers for verification.

(5) The buyers discount the bills.

(6) After management.