PUBLISHER: Allied Market Research | PRODUCT CODE: 1193227
PUBLISHER: Allied Market Research | PRODUCT CODE: 1193227
A syndicated loan is offered by a group of lenders who work together to provide credit to a large borrower. The borrower can be a corporation, an individual project, or a government. Each lender in the syndicate contributes part of the loan amount, and they all share in the lending risk. One of the lenders act as the manager (arranging bank), which administers the loan on behalf of the other lenders in the syndicate. The syndicate may be a combination of various types of loans, each with different repayment terms that are agreed upon during negotiations between the lenders and the borrower.
The demand for syndicate loans is growing largely due to requirement of huge amount of funds by the borrowers. It is generally difficult for a single lender to give loan for such big amount and therefore syndicate loan demand is growing among both the borrowers and lenders. In addition, syndicate loan helps to equally distribute the risk sharing among all the lenders which reduces the burden of the lender, in case the borrower is unable to repay back the loan amount. These are some of the factors propelling the growth of syndicated loans market. However, there are high chances of a syndicate loan becoming a bed debt, as such huge amount is difficult to be repaid by the buyer and if the project fails for which the loan was taken, then the lenders have to face the loss. Therefore, lenders hesitate to lend money for syndicate loans. Thus, this is a major limiting factor for the syndicated loans market. On the contrary, there are a large number of megaprojects being developed, such as construction of dams, road infrastructures, buildings and others for which a large sum of money is required. Syndicate loans are very useful in these cases as they finance such projects easily. Therefore, the large scale development of megaprojects is expected to provide lucrative growth opportunities for the syndicated loans market in the coming years.
The syndicated loans market is segmented on the basis of type, use of proceed, industry vertical and region. By type, it is segmented into term loan, revolving loan, underwritten transactions, and others. The term loan is further bifurcated into fixed-rate, floating-rate, and others. By use of proceed, it is bifurcated into working capital, acquisition financing, project finance, and others. By industry vertical, it is segregated into financials services, energy and power, high technology, industrials, consumer products and services, and others. By region, it is analyzed across North America, Europe, Asia-Pacific, and LAMEA.
The report analyzes the profiles of key players operating in the syndicated loans market such as Acuity Knowledge Partners, Bank Handlowy w Warszawie S.A., Bank of China (BOC), Bank of the West, Capital One, CLAAS Group, EBRD, JPMorgan Chase & Co., Mizuho Bank, Ltd., Mitsubishi UFJ Financial Group, Inc., PT Bank BTPN Tbk, State Bank of India, The SILC Group, Truist, Union Bank of India., AXYON.AI, and HubX. These players have adopted various strategies to increase their market penetration and strengthen their position in the syndicated loans industry.
Key benefits for stakeholders
By Type
By Use of Proceeds
By Industry Vertical
By Region