STRUCTURED FINANCE & SYNDICATION
Structures and Syndicates In gearing up for the post-Covid economy, structured finance and syndicated lending will be an important source of capital for regional businesses, and banks are now looking at leveraging technological solutions such as distributed ledger technology and smart contracts to advance negotiation, execution, administration and trading of loans
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hough the COVID-19 pandemic seems to be subsiding in most structured finance markets g l o b a l l y a n d va c c i n a t i o n programs are currently underway, potential new variants, uneven inoculation rates and further infection waves remain
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a risk. “After a substantial dip in 2020, the run rate of new global structured finance issuance has now fully recovered, with ongoing weakness in covered bond volumes countered by growth in securitization,” S&P Global said in June 2021.
Banking and Finance news in the MEA market
The most important question in the current challenging operating environment is how can banks bridge the gap between borrower demands for better pricing and longer tenor? The slowdown in economic activities due to coronavirus-related restrictions and the uncertainties around the trajectory of the pandemic forced non-financial firms to tap debt markets—and syndicated loan markets—as part of the companies’ broader efforts to secure funds for covering operational expenses and possibly boost their coffers. According to the Bank for International Settlements (BIS), borrowing by nonfinancial firms in global debt markets surged following the COVID-19 shock and central banks played a pivotal role in accommodating the increase in funding requirements. Syndicated loans are a significant source of capital in the Middle East. Regional banking powerhouse such as Saudi National Bank and UAE’s First Abu Dhabi Bank have become more sophisticated and are capable of meeting most of the financing needs of large businesses in the Middle East. Similarly, international banks such as Citigroup
