You have a bank willing to extend a loan to you?

0 Comments

You need collateral in the form of an SBLC or a Bank Guarantee to back up a loan? This collateral service is available to any qualified clients with a business of substance. If you have an established business and you want to start a project and require a loan for this business, then you will talk to your bank. Since your bank worked with you probably for years, they like to work with you. But to extend a loan, they ask you for collateral which you may not have.

A Provider and Facilitator will lend collateral on the basis of a Securities Borrowing and Lending Agreement. Through such a contractual agreement, the Provider (securities lender) wants to make sure that he is paid a lending fee and that the receiving bank will return the collateral at the agreed upon time.

Your bank will have to consent to the transaction

You will have to ask your bank to consent to the Collateral Lending and Borrowing transaction and to any of the 4 optional and conditional payment undertakings that can be used in this transaction. If your bank agrees, highly rated publicly listed securities will be selected and allocated. These top rated securities will build that basis of the Securities Borrowing and Lending Agreement, and the financial instrument that will be issued for you. This financial collateral will be advised to your receiving bank in the form of a Bank Guarantee or Standby Letter of Credit sent via SWIFT MT760.

For your transaction, clearly identified, top rated, publicly traded and listed prime bank securities are ordered by a Securities Dealer on the secondary market for your transaction and are placed into their securities account and paid for simultaneously as these securities are advised to your receiving bank (in the format of a Bank Guarantee of Standby Letter of Credit, cash backed by these securities) and your receiving bank pays for the agreed lending/borrowing fee only after receipt and verification.

The instruments backing up your transaction are ultimately purchased particularly for a client and a specific transaction. This is why the client (the borrower) will have to commit to the transaction and place a commitment fee.

No investor would want to buy securities for you and to your benefit, without a firm and valid financial commitment to the transaction. If you are not considered a qualified client, you will be requested toplace a Commitment Fee and the Collateral Provider places the Call Option Fee to secure these Securities for your transaction.

The Collateral Provider or Facilitator places a Call Option to buy these securities after you have committed to the transaction and you transferred this small share to the facilitator in the form of a fully refundable Commitment Fee. You will be provided with a Pro- Forma Invoice with full details of the securities that will back up the transaction for the receiving bank to verify.

A Conditional Payment of the Borrowing and Lending Fee is required to be issued or to be endorsed by your bank. After the commitment fee has been placed, you have 20 days to have your bank send the agreed conditional payment as to the instructions given in the Securities Borrowing and Lending Agreement as instructed by the Provider.

Upon receipt, and if due diligence performed between banks remains positive, the Provider sends a fully cash backed Bank Guarantee or Standby Letter of Credit which is issued on the back of the agreed securities.

The client’s bank pays for the Borrowing and Lending Fees after the SWIFT MT760 has been transmitted, received and verified.
You bank pays the lending fee only after receipt of the BG or SBLC and only after verification of the SWIFT MT760.

Upon receipt of the instrument at your bank:

• You now have the required collateral in your bank, and you can draw cash from your credit line to start your project.
• 15 days prior of the maturity date of the BG or SBLC, you ask for an extension for another year, or have your bank return the Securities backed Bank Guarantee or Standby Letter of Credit.