Features
Banca Comerciala Romana, through the Agency Desk team, provides services corresponding to the role of Facility agent and Security agent within syndicated loans.
Facility agent
The facility agent has an administrative role, acting as an intermediary between the borrower and the banks within the syndicate, both related to communication and the flows of funds.
The main attributions of the facility agent are:
✔ To act according to the instructions of the lending banks and to represent the interface between them and the borrower
✔ To send notices to the parties relating to the operational aspects of the credit (loan drawings, payments of interest and fees, sending of reports and other information etc.)
✔ To manage the calculation, collection and distribution of amounts representing loan drawings, reimbursements, payments of interest and fees etc.
✔ To keep a registry of the banks in the syndicate and their quotas of participation
✔ To monitor the fulfillment of certain contractual conditions by the borrower
✔ To coordinate the voting process in the event of amendments and waivers to manage accession of new borrowers and loan participation transfers between lenders
Security Agent
The Security agent manages security brought by the borrower to the syndicated loan in favor of the lenders, with responsibilities in storing, registering, monitoring and releasing them.
Moreover, the Security agent manages the process of security enforcement and of distributing the resulting amounts, in the event that the lending banks have decided as such,
The Security agent role is independent from the Facility agent role, even if it is fulfilled by the same bank.
Principles of the Agent
The activity of being an Agent involves the application of certain principles, such as:
✔ Neutrality: the Agent has an administrative and mechanic role and it acts upon instructions from the lenders, in accordance with the provisions of the credit agreement
✔ Transparency: the Agent promptly distributes the information received from one party to the adressees and doesn’t keep the information to itself
✔ Independence: the Agent bank ensures a strict separation of the Agent role from other roles that the same bank might fulfill under a syndicated loan (lender, arranger, collecting bank etc.)
✔ Confidentiality: the Agent does not disclose, neither within the bank or to third parties, information that is flagged as being confidential, unless in accordance with the rules on how to treat such information
✔ Equal treatment: the Agent distributes the same information, at the same time, to all the addressees
Contact
Agency Desk – Transaction Banking Division
Email: BCR.Agency@bcr.ro
Telephone numbers: 0373.515.518 / 0373.513.838
Frequently asked questions
A syndicated loan is granted by a group of borrowers and is structured, arranged and managed by one or more commercial or investment banks having specific roles (Arranger, Facility agent, Security agent).
Usually, 2 types of credit facilities are syndicated: term credit facilities and revolving credit facilities. Syndicated loan agreements can include a term credit facility and a revolving credit facility or a combination of the two or even more of each type (such as: several term credits in different currencies and with distinct maturity dates). A single Borrower or a group of Borrowers may be involved and the credit agreement can contain clauses which allow access, under certain conditions, to new Borrowers at certain periods of time.
The syndication process is initiated by the Borrower, who assigns a bank by giving it a mandate to fulfill the role of Arranger for the transaction; in certain cases, several banks can hold this role.
The Arranger is responsible with adivising the borrower on the type and structure of credit facilities needed and to negotiate the main contractual terms. Furthermore, the Arranger acts, most of the time, also as the Bookrunner, by selecting and negotiating with the banks which will form part of the syndicate.
In order to facilitate the loan’s management process, one of the banks in the syndicate is appointed as Facility agent, who will act as intermediary between the borrower and the lenders, both concerning the communication and the flows of funds.
In the event of a guaranteed loan, the role of Security agent will also be assigned, in order to keep and manage the guarantees for the benefit of the lenders.