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PROJECT LOAN AGAINST DOCUMENTARY LETTER OF CREDIT

Posted by BILL QUARSHIE on May 15, 2017 at 02:40:47:


Recently we have developed a Private Loan Program that enables our clients to finance their commercial or development projects.

Loan Amount: Multiple of € 25M

Use of Proceeds: (Describe the project)

Security margin:

Besides the project itself that serves as a collateral during the duration of the loan period, Lender requires a Documentary Letter of Credit (DLC) from the Borrower valid for 360 days in the amount of not less than €25M. The DLC will serves only as a Security Margin over 360 days and will not be used for any commodity trading. The DLC must be in the format provided by the Lender.


Fixed Interest Rate: 4% per annum payable in arrears

Loan Term: Five years or as agreed

Grace Period: Two years or as agreed

Loan Repayments:

Equal payments of principal and interest paid monthly in arrears after the 2 years grace period while in the first 2 years only the interest shall be paid quarterly in arrears.


Loan Disbursement:

In phases according to disbursement schedule approved by the parties but not exceeding € 2.50M every month until €25M is reached. First tranche is paid out after 8 weeks of signing the Loan Agreement and Issuance of the DLC as Security Margin by the Borrower


Prepayment:

Borrower may prepay the Loan any time after the first 3 years of the term.


Commission:

2% commission to be split 50/50 between buy and sell side


PROCEDURES WITH SECURITY MARGIN BY DLC

1. A) The Borrower provides a signed Application Form containing loan amount, loan purpose, Client Information Sheet (CIS), Company Registration Certificate, list of directors, contact details of shareholders, passport copy of the signatory.

B) Further, the Borrower’s bank provides an RWA Letter addressed to the Borrower himself confirming the availability of the required DLC (MT700). This is critical. No Loan Agreement is issued without this RWA Letter.

2. Upon verification of the RWA and satisfactory due diligence, Lender and Borrower sign a Loan Agreement.

3. The Borrower causes his bank to issue the DLC (MT700) with a specific format (Appendix A) to the designated Beneficiary’s bank. The validity of the DLC will be 360 days.

4. In 8 weeks upon receipt and validation of the DLC, the Lender transfers the first tranche of the loan to the Borrower’s designated bank.

5. Then after, remaining tranches will be paid according to the disbursement schedule as stipulated in the Loan Agreement.


PLEASE NOTE:

Should the required Project Loan be more than €25M, more DLCs of €25M must be provided. (Ex. For €50M loan, two DLCs of €25M are needed)

For further details, please send your questions by email NOW. billquarshie@gmail.com






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