Bridge Loan in India

Loan in India

Overcoming the financing gap in infrastructure and housing - SPARC Risk Management case study. The majority of Indian organisations are reluctant to lend to NGOs. Infrastucture India Receives Credit Prolongations; Working to Sign New Finance Contracts, September 18, 2018 13:59 p.m.

Infrastructural India said it had approved renewals of two credits as it was working on concluding a $125 million funding arrangement with PSA International. Prolongations were granted on an outstanding $43.4 million uncollateralized bridge loan from Cedar Valley Financial and an outstanding $21.5 million working cap loan from GGIC.

Bridge of financing interests

In principle, this type of loan is repayable for 6-month periods, but can last up to 12-month periods. Most of the bridge loan has an interest of 2%, which is above the mean of a given product. When you are planning to take a bridge loan, you need to realize that the interest rates for this type of loan are really high.

If for example you have this type of loan somewhere in India, then you need to have your current home within a year for you to yours sale in order to clear of your loan for the interest rates is really high. If Bridge loans are not processed correctly, they can also be a risk to the borrowers because they are taking out a high-yield type of loan and there is no assurance that the real estate can be resold within the period specified by the Bridge Loan.

When you think that the financing level of a bridging loan can help you, you can try it out for yourself. Be sure to do a great deal of research before participating in any type of loan.

Indien Loan House | Special Reports

In 2016, Citigroup consolidated its leadership in India's credit markets by securing significant event-driven transaction, venture capital and recurring client engagements from high-profile borrower groups. US banks have been particularly active in cross-border finance, executing sophisticated operations for global players and assisting their India customers to grow abroad. The Citigroup demonstrated its capacity to resolve financial problems in a number of important deal types, in particular Fiat India Automobiles' USD 250 million 7.6 year Brownnfield transaction, where the firm was originally the principal committed arranger and bookedrunner.

As a result of the transaction, the India loan taking set-up was uniquely structured - the new facility's asset and cash flows were earmarked to assist the new loan taking, but the credit providers stand by the operator's current credit providers. Brownnfield funding is provided without resorting to any of the partners - Fiat Chrysler Automobiles and Tata Motors.

The FCA has pushed ahead with credit taking as these were cross-default rules that have threshold values requiring the IT car maker to remedy any breach of convenant or failure. The FCA has not provided a guaranty for the new funding of the projects, but it is the buyer of the Jeep cars that the factory will manufacture under a'take-or-pay' agreement to cover the loan repayment.

The Citigroup has also successfully pinpointed chances in the area of M&A. As MLAB, Citigroup ONGC Videsh provided two bridging credits - a USD 875 million semi-annual credit in October and a USD 1.268 billion nine-month contract in May - to Citigroup ONGC Videsh for the acquisition of shares in Russia's oil fields. It was also an MLAB on the US$300 million bridge of Indian Oil Corp. which matured in March 2017 for the same use.

Citigroup was a major health care actor in Lupin's takeover of US company Gavis Pharmaceuticals, and coordinated and arranged the $800 million loan association for the company. Citigroup received another contract in this industry towards the end of the reporting quarter and financed Intas Pharmaceutical's £603 million ($770 million) takeover of the British and Ireland properties of the Israeli Teva Pharmaceutical Industries.

Faced with weak business and declining loan rates, Citigroup realized that loan spreads were primarily powered by funding, working harder to provide more flexibility and lower prices for borrower-owners. MLAB participated in the ONGC Videsh loan facilities of USD 1.775 billion, the biggest Indian funding this year, and in the USD 330 million funding by Bharat Petroleum.

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