Ready for large-scale growth? Consider loan syndication.
Is your business ready for the next phase of your growth plans? As exciting as it is to take on the next steps, we know it also comes with a lot of challenges.
Depending on the size and scope of your growth strategy, sometimes it’s difficult to procure the necessary financing to reach the next level. Loan syndication is a great option for corporations looking to acquire, merge, buyout, construct, or otherwise expand. This option allows you to get the funds you require from a single loan (which is backed by multiple lenders). This simplifies the financing process for you and allows one bank to act as the point of contact for all of your loan-related needs.
When is a loan syndicate needed?
Syndicates are common when a loan amount is too large for one lender to provide. A syndicate allows a bank to provide a large loan without taking on all the risk. Instead, multiple banks can share the risk by providing funding for smaller parts of the loan amount. The banks in a loan syndicate are only responsible for their portion of the loan.
Manage multiple sources through one contact.
A syndicate agent is the bank that acts as the syndicate’s leader. They coordinate the transaction and manage fees, compliance reports, repayments and overall reporting. This simplifies the process for the borrower, as you only need to work with one bank, rather than several to manage your financing. You can greatly increase efficiency by eliminating excess paperwork and having one point-of-contact for draw and payment requests. Plus, you can minimize the time spent on negotiations and due diligence.
Does Commerce Bank syndicate loans?
As part of our commitment to our customers, Commerce Bank is happy to be the lead financial institution on loan syndicates. In fact, we are currently agenting over $4 billion and work with lenders of all sizes across the country. With more than 155 years’ experience, you can count on Commerce to provide the insight and capital needed to execute your growth plans. We can provide guidance to structure, lead and distribute both syndicated and club deals, and we have long-term established relationships with banks of all sizes to lower execution risk.
What should I consider?
The great thing about loan syndication is that you can greatly expand your capital for current and future growth while only choosing one trusted financial institution. Commerce Bank works with our clients to select the right bank participants to establish a strong capital base and syndication strategy. We can even tailor a syndicated loan to your specific needs and industry. Whether you are looking at acquisitions, capital expenditure, refinancing, recapitalization, construction, or something else, you’ll get the capital you need.
By choosing Commerce Bank as your syndicate agent, you’ll get the same level of service that we’re famous for. We’ve been helping businesses grow ad putting our customers first since 1865. When you need a solution that's tailored to your business, we'll be more than happy to show you how we can work together to turn your goals into successes.
Also See:
- What Should I Do Before Applying for a Loan?
- What Should I Consider When Exploring Banking Relationships?
