Loans involving multiple lenders are often complex and operationally onerous. It can be difficult to keep on top of cash flows, transfers and communications between borrower and lenders, and to ensure the loan administration is kept up-to-date. Appointing an independent agent can remove the administrative burden of this process and create efficiencies within your internal teams.
The capital markets are also subject to a growing number of stringent regulations and transacting parties need to effectively manage potential conflicts of interest - especially in workout or restructuring scenarios. As a result, lenders increasingly find themselves seeking independent service providers to administer the loan agency aspects associated with their portfolios. This occurs either from the outset or by stepping in as a successor agent during the lifespan of the transaction.