Russian Economic Academy of G.V.Plekhanov

IBS - Plekhanov

Course Work on Credit Market:

Syndicated Loans Market

Student: Denis Untilov

Group: IBS 5303

Professor: A. S. Fedunin�

3Introduction �

4The Syndication Process �

4The Lead Manager's Proposal �

4The Decision to Participate �

5The Proposal �

7Awarding the Mandate �

8Preparing for Placement �

9The Management Team �

10Documentation �

10The information memorandum. �

10The loan agreement. �

11The Roles of Participants �

12The Lead Manager �

12Managers and Co-Managers �

13Participating Banks. �

13The Agent. �

14The Credit Facility �

14Term loan. �

14Revolving credit facility �

14Mixed �

14Loan Cost �

14Actual lending interest rate. �

15Management fee. �

15Agency fee �

15Participation fee �

16Commitment fee �

16Servicing the Loan �

17Syndicate Loans Today �

17Russia �

18Europe �

18United States �

19Conclusion �

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Introduction

Syndicated loans involve the lending of substantial sums, the underwriting and management of which are handled by more than one financial institution.

Loans

Loan

Loan Forgiveness

The lenders often come from different regions of the world and are rarely located in the country of the borrower. Syndicated loans have been one of the most significant instruments of international finance to emerge since World War II. Their popularity increased until 1982, had a setback for the next four years (until 1986), and improved considerably by 1988 but has been stagnant since. The syndicated loan affords borrowers access to large amounts of money that single lenders cannot or will not supply. Common uses of syndicated loans have been to cover balance-of-payments deficits and to finance the types of major development. Because of the way syndicated loans are managed, there is also a convenience factor--the proposed credit, which may, in the end, involve anywhere from 4 to 100 lenders.