Loan Syndication

Loan Syndication Making available a very large loan to a corporate borrower by a group of banks, headed by a lead bank which may provide only a small percent of the loan, syndicating the rest of it to other banks and financial institutions. If the borrower stipulates which banks are to form to syndicate, it I sknown as a CLUB DEAL. In any case, the borrower has the right to know the names of the members of the syndicate. Syndicated loans are usually cheaper than market borrowings.

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