QUESTIONS AND ANSWERS ABOUT THE SBLC SYSTEM
Are there any upfront fees?
None!!! The providers we use do not charge upfront fees just to look at a project. Neither do they charge fees in advance of closing. Often the banks pay their commission direct and on other occasions they are collected at the closing table.
I’m a Developer based in California but I want to fund a project on Barbados. How can I achieve this?
Initial stage is very easy. Answer 14 simple questions about your project and indicate the amount of liquid cash or fixed assets available to support your application. Once we have this document, within 48 hours you will hear from a Financial Consultant ready to discuss options and expand upon your company’s overall requirements.
Can your sources offer traditional debt/equity loans and what’s the typical LTV (Loan-to-Value) and current interest rates?
Yes, of course debt/equity loans are standard. LTV can range from 65/35 right up to an including 100% funding. Current interest rates start from 3.9% with a current maximum rate of 6.5%. These rates only apply to debt/equity loans.
Do the debt/equity loans require a j.v. (joint-venture) partner?
There are a range of debt/equity loan options which can be discussed with the Financial Consultant when he calls. However, a j.v partner is not required for any of their loans. Nonetheless, for companies who cannot provide seed capital, it may be possible to offer j.v loans.
If it is a true 100% loan system with no contribution from the developer, how does it work?
Generally the developer will be asked to raise 15% of the total amount required. These funds could remain in the applicants own bank (provided ‘A’ rated). The applicant would agree to a special Joint Reserve Account with the Funding Bank. This is to cover principle & interest payments for the first two years since no repayments are required during this period. If the developer is in receipt of income by the end of this period and able to meet the reserve requirements, there is no call. Thereby funds are returned to the applicants’ control.
What type of creative funding can you offer and what do we have to do to get this facility.
‘Structured Financing’ is geared to match developers specific capital needs.
Provided the company has cash or assets a variety of different methods can be employed to leverage developer existing funds. Often it is possible to multiply stake funds with only debt servicing required. The original principle is retired early in the process. Example; $10M within a period of 60 days $60M available free and clear. It is possible to accelerate the process dependent upon specific details attached to each project. Interest rates are variable but currently no higher than 7.5%.
How is this achieved and what risks are there for our Company?
The process and type of structured financing will vary greatly from one company to
another. Therefore answers will be provided by a Consultant related to match your circumstances and time-frames involved. However, all contracts and money transfers would be operated ‘bank-to-bank’ via SWFT and only after the directors have met in the premises of the funding bank. It is always recommended legal & financial advisers accompany the applicant company at this stage. Please rest assured the entire process is ultra-transparent once non-disclosure documents have been signed with the any of the co-operating triple ‘A’ rated banks. Therefore, we are pleased to report risk is reduced to an infinitesimally small level.
If this is so safe why haven’t I heard about this kind of multiplier before from my own bank?
Structured Finance options are especially formulated with the top 25 World Banks, Trust Funds & International Investor Groups. Invariably these are then offered to Company’s via Specialist Intermediaries and / or including Asset Managers, Hedge Funds and even REIT’s (Real Estate Investment Funds). However, they are not normally available from a company’s regular branch since the product/service is not capable of being delivered in this manner. Most Branch Manager would be oblivious to structured financing options.
What’s the minimum amount of funds required taking advantage of these structured formats?
This can vary but we suggest a minimum of 15% of the total anticipated cost of a project is the most intelligent starter figure. It can of course be less and a Consultant will advise you accordingly.
How long does the entire process take from start to complete funding?
Every application is different and therefore time-frames will vary. As a norm, we suggest a client should anticipate a minimum of 21 days (fast-track trading option) to a more standard 30-46 days.
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