Multiple financing is resorted as a method of financing when several financial organizations resorts to financing the same project, with individual participation. The borrowing entity resorts to enter into multiple agreements at the same time. The documents are not executed jointly but separately. The security is shared on a pari-passu basis.
Syndicated financing is resorted to as a method of financing when a number of financial organizations resort to financing the same project under a common agreement with one of the financial organizations, being the leader of the arrangement.
In order to finance large exposure projects, and also to maintain the exposure quantum within the exposure limits, minimize risks and to overcome liquidity problems, the Bank may require that the financing of projects involving very large amount of fund requirements, co-financing arrangements with other national or international financial institutions will be required to be entered.
The Bank can enter syndicate financing as the lead Bank or co-financer provided that the interest of the Bank is fully secured on first charge or first Pari-passu charge creation basis, in either case, in proportion to credit risks taken. The Bank, however, has to strictly follow the External loan and suppliers' directive of the BoSS.
