Europe’s leading boutique finance company in the Collateral Transfer market, IntaCapital Swiss, working closely with Providers of Bank Guarantees, and through their highly popular financial model, the Collateral Transfer Facility, are making available loans and lines of credit, also known as Credit Guarantee Facilities, to companies that are being starved of credit facilities.
For in-depth details on a Provider, please go to “Who Are Providers And What Are Their Benefits From Leasing Bank Guarantees”.
IntaCapital Swiss can make available short-term finance for one to two years, but can also make finance available from three years up to and including seven years. By signing a Collateral Transfer Agreement, companies can lease a Bank Guarantee, from the Provider, which they may use as collateral when requesting loans and lines of credit from their bankers.
When approaching their banks for Credit Guarantee Facilities, companies must remember that they must have on their account a Demand Bank Guarantee. A Demand Bank Guarantee is governed by ICC Uniform Rules for Demand Guarantees, (URDG 758), and has been specifically written to give banks first class security when advancing loans and lines of credit.
For more information on ICC Uniform Rules for Demand Guarantees, (URDG 758), please ask our experts.
It is worth noting at this point that, from time to time, some banks have turned down applications for Credit Guarantee Facilities where a Demand Bank Guarantee has been offered up as collateral. In such circumstances, IntaCapital Swiss can bring third-party lenders to the table, who, if offered a Demand Bank Guarantee as a security, will offer the client access to loans and lines of credit.
All terms are issued for one year only, even if a company decides to renew or rollover a Collateral Transfer Agreement. The cost of leasing a Bank Guarantee will be dependent on the availability of collateral and whether or not the bank issuing the Bank Guarantee is investment grade. In the event the Issuing Bank is Non-Investment Grade, the provider will charge a fee of around 6%, in the event the Issuing Bank is Investment Grade, (BBB- to AA+), then companies can expect the Provider to charge a fee of circa 16%.
Further annual fees for the account of the Beneficiary of the Bank Guarantee will be the cost of borrowing for one year which will be reliant on 12-months Libor or 12-months Euribor rate at the time of signing the Collateral Transfer Agreement. First year only costs, are booking fees, legal fees, arrangement and due diligence fees.