Syndicated Loan Agreement Proz

In this country, there has not been standard documentation on syndicated loan agreements for a long time. Such a situation is considerably complicated with this form of lending, especially to finance innovation. One of the problems was that the structuring of the agreement was carried out according to the rules of a specific bank. The work of the Russian Regional Banking Association is ongoing. The experts` efforts are now aimed at developing additional documents for the syndicated credit contract. Indeed, the main objective of providing syndicated credit to banks is to spread and minimize risks. When the consortium contract is concluded, credit risks are distributed among all union participants and significantly increases the reliability of the credit and the confidence of lenders in the return of the funds awarded. The Bank`s participation in the union enhances its financial capacity, as it receives significant compensation for the granting of loans. The borrower pays the fees to the Deal Maker as well as a bonus to the agent bank. The amount, procedure and date of these payments are usually set in the royalty letter signed by the borrower, the deal maker and the agent bank at the conclusion of the loan agreement. And compensation depends not only on the current market situation, but also on the borrower`s financial situation – the worse it is (a small borrower, a new entrant, an unstable financial situation), the greater the risks of bank lenders, and therefore the higher the commission. At the same time, there is no concomitant opinion on an issue on the components of the mixed credit contract.

There are different models: 1) loan contract – agency contract; 2) loan contract – agency contract – guarantee contract; 3) Loan contract – simple partnership agreement and others (Popkova, 2016). Objective – There is an urgent need to put in place an appropriate regulatory system for innovative banking activities under the conditions of the creation of the new economy. Design/method/approach – With regard to legal research on the innovative entrepreneurial activity of the banking sector, the authors refer to measures to create a new or developed banking product, to develop and adapt the possibilities of increasing the entrepreneurial activity of banks in order to obtain the economic and strategic effect of banking operations and transactions. The authors support the important place of syndication in the list of such actions. The article examines the pros and cons of granting syndicated credits, the demand for this innovative banking product and its scope. The authors study the legal nature of the syndicated loan for the existence or absence of plurality of those hired and for the agreement reached between union members. The authors also examine the problem of the slow evolution of syndicated lending by economic entities in the Russian Federation. The authors note that this financial technology abroad has long been used successfully, while in the Russian Federation, the granting of syndicated loans is considered an innovative banking product. Results – The authors conclude that this situation is due to the lack of detailed legal regulation in this area of trade relations, as well as the poor development of the mutual credit partnership between commercial banks.