ADDRESSING THE SECONDARY DEFAULT COLLATERAL NEEDS OF INDIVIDUALS AND CORPORATIONS.
Global Project Financing Group, LLC contracts as consultants for the issuance of bank debt instruments with our clients as beneficiaries from top 25 world banks for credit and collateral enhancement. These bank debt instruments will be callable, lienable, corporately assignable, irrevocable, unconditional, corporately transferable and available to our clients as beneficiary unrestricted as a default piece of collateral or credit enhancement for either a line of credit or loan that is established at their financial institution that is supported by an underlying transaction.
Instruments from $10M – $500M
Bank Debt Instruments
1. CD: Certificates of Deposit .
2. SBLC: Standby Letters of Credit
3. BG: Bank Guarantees
4. DPLC: Direct Pay Letters of Credit
• Instruments can be used as secondary default collateral to support an underlying transactions credit line or loan.
• Compensation package for our refer ral sources .
Frequently Asked Questions
Q: Is this first lien position collateral?
A: No, this collateral is 2nd lien position default collateral. The beneficiary may
participate in any legal financial transaction using the collateral as provided by the directors of finance, however the collateral may be used ONLY as collateral for a underlying transaction.
Q: If my bank undertakes to return the collateral contractually, can I use the collateral in first lien position?
A: Technically, yes, you would be able to use the collateral in a first lien position if your bank undertakes to return the collateral 15 days prior to maturity. However, if your bank is willing to undertake the return of the collateral, technically, you do not need it because you could just get a loan from your bank.
Q: Can the collateral be blocked in favor of any nominated credit facility?
A: The collateral can be blocked in favor of a financial institution for the benefit of a loan or line of credit for an underlying transaction which has gone through credit, compliance and underwriting, whereas the commitment has been received subject only to the presentation of collateral (i.e. SWIFT MT760).
THIS IS NOT NEGOTIABLE, WE MUST REVIEW LOAN COMMITMENTS WHICH ARE SUBJECT TO APPROVAL FROM MANAGEMENT.
Q: Will the collateral issued for the beneficiary be fully cash backed?
A: Yes, the collateral (SBLC, DPLC, Bank Guarantee or Certificate of Deposit) is
backed by cash.
Q: Will the cash backing the instrument be blockable funds?
A: Yes, the cash, which backs the instruments will be blockable funds.
Q: Can the funds that back the instrument be internally blocked and reserved at the
issuing institution?
A: The funds can be blocked, however, the request for the blockade must be made by the lending or beneficiary bank.
Q: Why do you require 4.25% of the face value of the requested instrument to be posted to escrow and released to issue an instrument?
A: One of the main reasons we collect this, the issuance fee is a catalyst that assists in “weeding out” the performers from non performers. Historically there is a strong correlation between clients who cannot pay for the issuance fees and clients who default on either return of the collateral to us, payment of the IPIs, or the loan, which they are securing using the collateral we provide as default collateral. On top of the fact, we are using it to divert those who plan to run with collateral, we also debit a credit line, taking that cash to create the respective instrument, and finally register the ISIN and CUSIP numbers with DTC/Euroclear where it can be viewed, confirmed, the block and delivery requested on a bank to bank basis.
Q: How is a loaned instrument different than a leased instrument?
A: Global Project Financing Group, LLC., loans Bank Debt Instruments that are all
callable, lienable, transferable and assignable, which means that can be used as
default collateral to support a loan, a credit line, or transaction. The collateral is
bank debt instruments that are issued in the clients name for their unrestricted use for the term that the client loans the collateral from Global Project Financing Group, LLC., without a bank undertaking for the return of the collateral or the balance of the fees paid for the use of the collateral. Leased instruments can not typically be used as default collateral, with or without a bank undertaking. Global Project Financing Group, LLC., does not lease bank debt instruments.
Q: How am I, the client protected against the loss of the initial 4.25%, which I put through escrow for the issuance of the CD, SBLC, BG or DPLC?
A: Through the use of an escrow agreement in conjunction with an escrow attorney and in the Agreement for Obtaining the financial instrument (section 5) if Global Project Financing Group, LLC., or assigns does not have the financial instrument posted to DTC/Euroclear within 15 international banking days of the receipt of the hard posted funds through escrow, the client will receive the full 4.25% back to, which ever coordinates they had come from originally, this amount will include the $2,500 engagement fee.
Q: What can these bank debt instruments be used for?
A: We issue & deliver bank debt instruments, which can be used as default collateral to support credit lines, loans and transactions. For example a real estate acquisition or development may require some additional collateral for the loan or you may take the collateral and get a line of credit against this, using the cash for some type of investment vehicle. Essentially the instrument can be used for any reason why a group or company may need a cash infusion to include, but not limited to large real estate acquisition, real estate development, condo development, hotel development, water park or theme park development, sport team acquisition, credit enhancement....
Q: Does Global Project Financing Group, LLC., offer monetizing services or provide
liquidity against the collateral they issue?
A: YES, Global Project Financing Group, LLC., does monetize or provide lines of credit or liquidity against the collateral we issue. We issue collateral. The primary reason behind this, Global Project Financing Group works with Banks, Trusts & Private Equity Groups that lend against this collateral, when this happens, the due diligence and project feasibility is underwritten by the banks or investment groups who intend to lend against the collateral on the clients behalf.
Q: How do I know if my current bank will lend against this collateral?
A: You will need to speak with a banker who understands and has capacity to lend on structured products and bank debt instruments. Many clients take this concept to their retail banker who very typically has no experience in this arena. It is advised a client may request to speak with their banks global custody department or wealth management department. European banks typically are accustomed to this type of collateral lending.
Q: Can Global Project Financing Group, LLC., recommend a bank or banker to lend
against the collateral you issue?
A. Yes, We are a Collateral Provider Corporation. Global Project Financing Group, LLC., along with our strategic partners in collateral provision merely provide collateral. Typically the client comes to Global Project Financing Group, LLC., with a banker and transaction already in place, they merely need collateral to extend or increase this loan size, credit line, or other credit facility.
Q: What are Global Project Financing Group, LLC., thresholds for minimum and maximum amounts for instruments which they will issue?
A: Global Project Financing Group, LLC., issues bank debt instruments such as
Certificates of Deposit, Standby Letters of Credit, Bank Guarantees and Direct Pay Letters of Credit starting at a denomination of Ten Million ("10,000,000.00) US($) or EURO(€) up through Five Hundred Million ("500,000,000.00) US($) or EURO(€). We can also entertain larger transactions which will be done in smaller parts. For example, a 1 Billion US($) or EURO(€) transaction would be completed with the issuance of two 500 Million US($) or EURO(€) instruments. (2 x 500M € or $).
Q: Can I put the full fee into escrow for the use of the instrument and go straight to
delivery?
A: Yes, Global Project Financing Group, LLC., has many clients who have put up the 20% for a 12 Month Certificate of Deposit loan and we follow standard procedures for issuance of the instrument, but since the client has the all of the money in escrow for the full use of the collateral for the loan term, we do not need to create irrevocable payment instructions (Annex C of Agreement for Obtaining a Financial Instrument). We can thus go straight to delivery from DTC/EUROCLEAR to the client's bank.
Q: Can I talk with a banker at the issuing bank to confirm the instrument?
A: No, a client or banker will not speak to a bank officer to view, confirm, request the block or delivery of the instrument. Everything has to be done within the banking system. The system that is used to view, confirm, request the block and delivery of the instruments is DTC/Euroclear Grey Screen. It's important this occurs in the banking system where everything is traceable, trackable, and can be done with full banking authority and is auditable. This alleviates fraud, misappropriation and hypothecation of instruments by anyone else and keeps the instrument safe for who the instrument belongs to for the duration of the loan, our client. However, once the bank confirms there is a banker on the beneficiaries end of the terminal, a banker can request a call in the system.
Q: What can I do in the event I do not have access to a banker with high
level inter-bank "grey screen" access, can I still get an instrument?
A: Yes, click on the PROCEDURES link below, then click on the COLLATERAL FIRST VIA
MT760 SWIFT PROCEDURE this procedure is an effective means of taking delivery of the
instrument in the event your banker does not have high level access to the interbank "grey screen" to enable him/her to view, confirm, request the blockade and delivery of the instruments.
* Rates, Terms and Procedures are subject to change without notice. GPFG and its affiliates reserve the
right to cancel, approve, or deny any and all business transactions without any prior notification.
Global Project Financing Group, LLC., is not a Certified Financial Advisory Firm, Securities Brokerage Firm and/or a Stock Brokerage Firm. Global Project Financing Group, LLC., is a business consultancy firm who provides advice to private individuals on or about business matters.