I. Business Overview
Syndicated loan refers to the RMB and foreign currencies loan or other credit business provided by two or more banks or non-bank financial institutions to the same borrower through the correspondent bank at the agreed time and proportion based on the same loan conditions and the same loan contract.
II. Object of Application
Corporate customer(s) who satisfies relevant national policies and BoCom credit access requirements, is in a demand for large-scale project financing, large-amount liquidity financing and other credit financing, with normal operation and management, and financial status, legal and compliant loan use, good credit status, and corresponding solvency.
Firstly, the amount of financing is large, and the financing plan can be flexibly designed according to customer needs. The syndicated loan involves a number of banks, which can provide funds with larger amount and longer term than the bilateral loans, and can flexibly set the loan term, currency, credit type and repayment plan according to the actual needs of the customer. The customized solutions can meet the customers’ needs for various types of large-scale financing.
Secondly, it helps shorten the negotiation cycle and improve operational efficiency. During the formation of the syndicated loan, the leading bank is responsible for the loan scheme design, financing conditions negotiation, text compilation; after the syndicated loan is formed, the agent will complete the follow-up work such as fund transfer and post-loan management according to the syndicated loan agreement. The borrower does not need to communicated and negotiated separately with lenders, which improves the loan efficiency and saves the manpower and financial costs for the enterprise.
Thirdly, the scope of application is wide. From the perspective of the types of borrowers, syndicated loan is suitable for both large enterprises, group customers, and small and medium-sized enterprise customers. From the perspective of project duration, it is applicable to both long-term and medium- and short-term projects. From the perspective of project types, it is applicable to both domestic projects and cross-border and overseas projects.
Fourthly, it helps deepen the cooperation between banks and enterprises and increase its market influence. Under the syndicated loan model, the borrower can obtain credits from a number of banks, which is beneficial for it to expand financing channels and establish good cooperative relationships with the banks. Syndicated loans are often invested in influential brand projects in the local market, and the joint crediting of those banks, organization of contract signing, and coordinated publicity help to enhance corporate value recognition and social influence.
IV. BoCom Strengths
Since 1986, the Bank of Communications has been engaged in syndicated loans and project financing. Since 2006, as the deputy director of the China Banking Association's syndicated loan and trading professional committee, it has been actively participated in the development of the measures and model texts for syndicated loan projects and the construction of second-hand syndicated loan market, and acted as the leading bank in syndicated loans for many projects and accumulated rich experience in the preparation and organization of syndicated loans for infrastructure, transportation, real estate, power, leasing and business services industries. With the well development of business, BoCom has gradually established a professional syndicated loan team and standardized management and operation procedures. Its business ranks the top among domestic commercial banks and it has been honored Best Development Award, Best Management Award, Industry Contribution Award and Best Project Award by the China Banking Association for many years. In addition, the Bank of Communications utilizes offshore license resources and the layout of overseas outlets, and gives full play to the advantages of comprehensive integrated business in securities, asset management, funds, trusts and insurance within the Bank of Communications Group, and timely explores and meets customers' overseas financial needs to provide high-quality and efficient syndicated loan service for domestic and overseas customers. In recent years, the various domestic and foreign syndicated loan projects like the 22.7-billion RMB Guangdong Chaozhou-Huizhou Expressway, the 18-billion RMB Shaojin section of the Hangzhou-Shangzhou-Taizhou Expressway, the 10-billion RMB Shanghai Tower Project and the 4.1-billion USD GLP Privatization Project were quite influential in those sectors.