Sub-participation: Difference between revisions
From ACT Wiki
Jump to navigationJump to search
imported>Doug Williamson (Link with Novation and Assignment pages.) |
imported>Doug Williamson (Expand. Source: Global supply chain finance forum.) |
||
Line 1: | Line 1: | ||
1. ''Banking'' | |||
An arrangement between two banks whereby in return for the sub-participant bank depositing with the lending bank the principal amount of a [[loan]] made by the latter, the lending bank will pass to the sub-participant bank its relevant share of any payments received from the borrower. | An arrangement between two banks whereby in return for the sub-participant bank depositing with the lending bank the principal amount of a [[loan]] made by the latter, the lending bank will pass to the sub-participant bank its relevant share of any payments received from the borrower. | ||
Line 5: | Line 7: | ||
Also known as a participation. | Also known as a participation. | ||
2. | |||
Similar arrangements between other finance providers. | |||
Latest revision as of 14:40, 20 June 2016
1. Banking
An arrangement between two banks whereby in return for the sub-participant bank depositing with the lending bank the principal amount of a loan made by the latter, the lending bank will pass to the sub-participant bank its relevant share of any payments received from the borrower.
As a legal matter sub-participation is solely between the lending and sub-participant banks, giving the latter no contractual link with the borrower.
Also known as a participation.
2.
Similar arrangements between other finance providers.