Collateral is a term used for assets
that a borrower is obliged to turn over to a lender if unable to
repay a loan. Usually, the property itself is the collateral for a
property loan. Collateral recovers all or part of a debt, if
repayment of the loan is not forthcoming.
With the Bank's guarantee, it should
be possible for a borrower to mobilize funds on terms and conditions
significantly better than it could do on its own-including
extensions of maturity and lower interest spreads. The borrower can
also select-depending on the acceptability in the particular
market-the currency, interest rate basis (fixed or floating) and
maturity to best match the project's requirements.
Commercial loans covered by a Bank
guarantee may be exempt from country-risk provisioning requirements.
Loans made by banking and non-banking
institutions could be covered under the guarantee.
Sirius
Financial Ltd. is pleased to arrange for its clients the issuance
and the discounting of different types of banking Instruments.