'Loan Syndication\r'

'LOAN SYNDICATION AS AN ALTERNATIVE moving in FINANCING STRATEGY IN NIGERIA dining table OF contented Title page Approval page commitment Acknowledgement Abstract CHAPTER ONE INTRODUCTION 1. context of the con 2. Statement of the conundrum 3. Objectives of the consider 4. consequence of the hire 5. Scope, limitations and delimitations 6. Statement of hypothesis 7. Definition of limits. CHAPTER both RE reliableize OF RELATED LITERATURE 1. Types and reference books of add to summation coin argoting comp whatsoever of Nigeria Plc. 2. Factors to be considered by Consortium of fiscal substructures before giving break through Loans to transaction Organization. . Factors to be considered by juncture Bank of Nigeria before exploitation Loan syndication as a source of divulge in. 4. Securities and engage rates delicious to the magnetic north Bank of Nigeria. CHAPTER terce RESEARCH DESIGN AND METHODOLOGY 1. Sources of entropy 2. check out Instrument or Instrume nt of Data collection. 3. localisation of function of breeding 4. Research questions. CHAPTER FOUR DATA unveiling AND ANALYSIS 1. Presentation of Data 2. Analysis of data 3. Interpretation of Data. CHAPTER FIVE FINDINGS, CONCLUSION AND RECOMMENDATION 1. Findings 2. passport 3. Conclusion Bibliography Appendix PROPOSALLOAN SYNDICATION AS AN ALTERNATIVE line of products FINANCING STRATEGY IN NIGERIA Lack of parentage has been champion of the study riddles militating against the progress and ingathering of our byplay organizations in Nigeria. This is caused by a lot of factors such(prenominal) as low-spirited savings (vicious circle of poverty), ignorance of the usual to invest, mismanagement etc. t here(predicate) are many an(prenominal) ways of solving the problems of afford and providing adequate finance to our parentage organizations such as equity stock, savings, move back profits, entirely for the purpose of this seek, we pee to pay attention to impartword syndication.This research get out focal point on the appraisal of the methods and ways through which Union Bank of Nigeria Plc source for strain in bring of establish from a group of fiscal institutions such as commercialized banks, merchant banks, insurance companies, cultivation banks and fiscal institution deal politicss thrift societies friends. It impart in like manner focus on the different classes of bring notably, long- frontier bring, average destination contribute, and short term bestow.The classes of loan provided by the different types of pecuniary institutions enumerated in a higher place impart likewise be considered by Union Bank of Nigeria before using loan as a source of finance instead of different sources. Similarity, it is in any case pertinent to treat the factors, which are considered by mob of monetary institutions before giving out loans to billet organizations. The securities and entertain rates treatment accept subject to the k itty depart similarly be tonicity into. Also, the reason why some financial institutions do not go into loan syndication exit also be inquired into.Before ending this research, it is consequenceant to study how the interest of the constitution is protected in the Union Bank of Nigeria as well as how the interest of all(prenominal) member of the consortium is protected within the group. These points enumerated to a higher place when treated, Union Bank of Nigeria chooses to finance their tramps and particularly loan syndication and we feel anybody who enjoys it. Summarily, the research work forget be grouped into five chapters. Chapter one will end the introduction, sub- emergences as background of study, statement of problem, objectives of study, signifi sack upce of study and so on.Chapter two contains the literature review. This chapter will give the detailed analysis of the yield. It is here that we state the intend of the topic of the research different types of cat egoryd credit finance, the procedures for syndicating a loan etc. Chapter three will mantle the research methodology and techniques. The sources of data, the instrument of data of data collection and the place the data is located. Chapter four, which is the data debut and analysis will rise the presentation of the data collected both in tables and charts, pie chart whitethorn also be used. Finally, chapter five which summaries the another(prenominal) chapters.The handouts recommendations and the closedown will be contained in this chapter. Having said oft(prenominal), this research study will be specifically bound to Union Bank of Nigeria Plc Onitsha Anambra State. CHAPTER ONE 1. 1 INTRODOUCTION OF THE deliberate The velalive insufficiency of fund for pileus enthronization is a unwashed factor in e actually frugality oddly in exploitation counties of the world. In developing counties like Nigeria; the low level of capital enthronisation manifest in high un go form ent rates; low productivity and corresponding low standard of vivacious for greater majority of the population.Finding a solution to this problem of providing fund for capital investment has been a major pre-occupation of financial institutions in Nigeria. Beyond the traditional term loan; share offers; bonds and on; business organizations and financial institutions alike take in sought out highway to tackle the problem of insufficient fund for capital investment. One of the solutions they deal come up with is syndicated loan or multiple credit facilities , which is aimed at spread head risks and weakening the dissemble of cut back laws and regulation on lend by financial institutions .Syndicate has been define as an association of industrialist, or financial or banking consortium forced to carry out some industrial projects. Accordingly, loan syndication is basically defined as an parallelism mingled with two or borrower with credit rapidity utilizing common loan docume ntation. The spectacular growth of loan syndication as an pick financial instrument for business organization occurred as response to several economic factors in Nigeria. Notable among these were: †The National industrial insurance indemnity of 1989, which is aimed at achieving, accelerated pace of industrial growth in Nigeria economy. The Introduction of structural adjustment programmed in 1986, culminating in the establishment of foreign Exchange grocery store (F E M) and depreciation of the aria, This do imported machinery and equipment very expensive and requiring hung capital outlays which most companies or financial institution dirty dog not comfortably afford. †hindrance on credit expansion by government and monetary authorities to minimize pretension. Central bank of Nigeria dose not included syndicated loan finance with in the credit checking, banks are there fore, able to syndicate loans with out interfering with the credit ceiling. The scrapping of impo rt license regime which enabled more users of imported equipment and machineries to source and bring into the terra firma. †Deregulation of interest rate made loan syndication attractive to both business organizations and financial institutions. The above factors concerned with the persistent domestic inflation and arising apostrophize of domestic production have increase the magnitude of credits demand by vanoys users of fund particularly the industrial producers.In addition, there are received legal and regulatory limitations on lending activities of commercial and merchant banks such as the statutory lending limit as provided in the banking act of 1969s. 13 (1) , the liquidity requirement ,e t c . In order to surmount these legal and regulatory limitations on lending activities of commercial bank ( coalescence bank) and merchant banks, loan syndication has become an attractive credit delivery technique aimed at spreading risks reducing the impact of the restricting laws a nd regulations.Currently, there exists no comprehensive enacted law on loan syndication in the country as to check the activities of the financial institution that lead and participate in the syndication. What is perhaps significant about loan syndication in the country is not the rapid growth of the financial institutions involved loan syndication, but their activities which have been quite an remarkable over the years.Also, the study of the extent to which union bank of Nigeria plc employ syndicated loan as an secondary support means with particular reference to Anambra and Enugu states individual financing means with loan as an instead have been carried out in this study. The research worker cautiously appraised all aspects of loan syndication as financing alternative in the country from the point of view of the borrower. It is also made extend in this work that attachment of numerous merits of syndicated loan financing as against its demerits.It is not to be used as a persist resort but should be considered alongside with equivalent alternatives. All these notwithstanding the most important of this study (it empirical study) is to know the popularity of syndicated loan financing among business organization in the country and the extent to which they employ it as financing alternative, no such study has been carried out in Nigeria. For the empirical study, Anambra and Enugu State respectively have been chosen due to timidity impose by cost and short-term on the researcher, other the researcher could have conducted the flock throughout the country. . financial statement OF PROBLEM There are conflicting views as to whether business organizations should be financed by syndicated loan or not. The opposition to the use of this alternative, especially in Nigeria, argues that syndicated loan is expensive and involves much administrative work. Also, there is invite to point out in every clear terms the advantages inherent in syndicated loan as m odal(a) and long term financing alternative. Besides, a review of the role of financial institutions in financing Nigeria business organization through syndicate loan is of par core importance.In addition to the above, the extent to which syndicated loan financing is embraced by Union bank of Nigeria Plc. In the country convey to be studies to know actually whether the much emphasized syndicated loan financing is being apply as financing alternative in Nigeria. 3. prey OF THE mull The purpose of this study includes inter-allies; †An examination in general terms of the divers(a) issues involved in loan syndication. †To find out whether loan syndication is actually a new approach to or another(prenominal) form of borrowing. To synthesize the merits and demerits of syndicated loan-financing vis-a-vis other sources of medium and long-term financing both by cost and codeless. †To survey the extent and prospects of loan syndication business in Nigeria analyzing critic ally the role of business organizations and financial institutions. †To find out whether loan syndication can help in industrial development of the country, especially under the stream economic situation. †To examine the extent of penetration of syndicated loan financing among business organizations in the country. 1. 4SIGNIFICANCE OF THE STUDYThis study will be of crucial benefit to the borrowers. The attention of the researcher was drawn by the need for loan syndication in Nigeria especially in the area of providing the borrower with credit facilities. This becomes overt that will be a need to take into account study that could examine loan syndication as it affects the investment and capital project outlays. Therefore, the significant of this study is to bearing into ways of making it easy for financing a capital project outlays which requires a syndicated loan, and also to go on financial firms to jointly finance project which one financial firm cannot single hande dly finance.It is hoped that after this study. It will be useful to every bank especially those in merchant banking and development banking. It will also provide entropy to general public on how to employ loan syndication as alternative business financing. This work is expected to be of immense determine to the students in financial studies and other think courses generally accountancy, banking and finance and so on, since this is part of what they are going to practice in their various place of work.Lastly, it will and government and other institutions to formulate suitable policy that will guide them in financing a big projects jointly with other financing firm. 1. 5SCOPE OF THE STUDY This research work however covers the loan syndication as an alternative business financing strategy in Nigeria. I took a close looks at the needs, functions and various benefit associated with Nigeria loan syndication. LIMITATIONS OF THE STUDY The first limitation, which was obvious, is the pa ucity of statistical data.Lack of statistical data from our financial institutions like central bank of Nigeria (CBN), ministry of finance, including commercial and merchant banks where the researcher visited at Enugu, Onitsha and Lagos to collect list of corporations they have financed through syndicated loan adhered strictly to the rule of secretly in banking, thus they refused to release such discipline. Another problem is the time constraint. A research of this nature need relatively long time during which information for correct infirmness could be drawn, the period for the study is short , thence time posed as a constraint to the researcher.Lastly, as the cost, the researcher would have extended the survey to other states at the empirical level and this would have produced accurate and more comprehensive work but for the hinge cost of transportation and accommodation in the various state of the federation. It is not possible. 1. 6 record OF HYPOTHESIS: Ho syndicated loan h as been employed against other alternatives as a medium long term financing strategy. Hi syndicate loan has not been employed against other alternatives as a medium long term financing strategy. Ho does syndicate loan has any impact on our national economy?Hi syndicated loan has much impact in our national economy. Ho syndicated loan has much impact in our national economy. 1. 7 description OF equipment casualty: The research topic has some notice words, which call for treatment before anything else. SYNDICATE: It has been defined as an association of industrialist, or financials or banking consortium forced to carry out come industrial projects. LOAN SYNDICATION: It is defined as an agreement between two or more lending financial institutions to provide a borrower with credit facility utilizing common loan documentation. —â€Important Instructions Start here—- PLEASE, print the following instructions and information if you will like to order/buy our complete pen material(s). Remember that our approved websites are www. careerslight. com or www. trustyprojects. com and our ordained phone numbers are 08169533305, 08158646653, 08126773402. Take annotating of our websites and phone numbers or write them down. 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