Wednesday, December 8, 2021
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Loan Participations for Community Banks: Risks & Rewards

May 14 @ 10:00 am - 12:00 pm CDT

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This program covers the risks and rewards of loan participations to both the lead bank and the purchasing bank. Attendees will gain a thorough understanding of Participation Agreements.

A participant’s checklist for a well-drafted Participation Agreement will be reviewed, and administration of the participated loan will be discussed.

What You Will Learn

  • Advantages of a participation to the lead bank and participant bank
  • Risks to the participant
  • Lack of information
  • Lack of involvement in negotiations
  • Dependency upon lead
  • Waivers
  • Financial instability/insolvency of lead
  • Set-off by borrower
  • Failure to perfect
  • Conflicts of interest
  • Due diligence by the participant and access to information
  • Disclosure of participation to borrower
  • Concentrations and other regulatory aspects of participations
  • Loan agreement provisions related to participations
  • Duties owed by lead to participant
  • Rights to loan collateral and guaranties
  • Loan administration issues
  • Loan payments and other functions
  • Consent to amendments
  • Restrictions on transfer
  • Loan purchase options
  • Reimbursement and indemnification obligations
  • Subparticipations
  • Set-off by participant
  • Understanding the participation agreement
  • The participant’s checklist
  • The participation in workout

Who Should Attend?

CRE lenders, commercial lenders; credit analysts, loan review specialists, special assets officers, lending managers and credit officers. Support personnel involved in the administration of loan participations are also encouraged to attend.