Sub-participation: Difference between revisions
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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. | 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. | 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. | |||
== See also == | == See also == | ||
* [[ | * [[Novation]] | ||
* [[Assignment]] | |||
[[Category:Long_term_funding]] | |||
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.
