Model

• Less than ¼ of EMDE external debt held by the private sector is in non-bonded form, but that share rises to about ¾ for LICs

• In 2022, the UK-Treasury led private sector working group (with support of IMF staff) developed a set of “specimen” majority voting provisions (“MVPs”) and a Guidance Note for syndicated loans

• Published by industry bodies (e.g., IIF, LMA, ICMA) in November 2022

• The specimen clauses have the following features:

► Allow a qualified majority of lenders in a syndicate holding a particular loan to bind a minority of lenders to changes in payment terms

► Creditor Protections: Voting threshold (75 percent), Disenfranchisement, Information Disclosure

► Ancillary features: e.g., unitised voting, changes to events of default, “snooze you lose” and “yank the bank”

• Roundtable with debtor countries held post-Annual Meetings, ongoing outreach, no signs of a first-mover