The Cause of bank failure

One member of the group is normally appointed to act as the managing or idle words bank for the syndicate and it is the role of this bank to coordinate all negotiations, payments and administration between parties once the signalize has been executed-it Is a multi bank transaction with each bank acting on a several basis, which heart that each ann. acts on its own without responsibility for the other banks in the syndicate.If a bank fails to honor its obligations as a member of a syndicate, the other syndicate banks have no legal obligation to see them on that banks behalf. Syndicated loans are normally used to finance the purchase of capital assets or the acquisition of other business line or federation. The syndicated credit market is one of the largest and most flexible sources of capital in the international market place. Loan syndication do happen In Zanzibar but are non in truth common. PROJECT LOANS project loans has been used to describe all types of finance of proj ects, both with and without recourse. A financing of a particular economic unit in which a lender is satisfied to look initially to the hard property flows and earnings of that economic unit as the source of funds from which a loan will be repaid and to the assets of the economic unit as collateral for the loan. Involve loans to finance major capital Investment projects for which the cash flow arising from the project will either be the sole or main repayment source.Such projects are usually financed by major banks because of the large amounts involved and the need for full technical evaluation for subject building a major dam or prospecting for 011. The loan Is usually provided on a modal(a) or long term basis. There are often other side benefits resulting from segregating a financing as a project financing which may have a bearing on the motives of the company seeking such a structure. These benefits include Credit sources may be available to the project that would not be ava ilable to the sponsor.Guarantees may be available to the project that would not be available to the sponsor. A project financing may enjoy better credit terms and interest costs in situations In which a sponsors credit is weak. Higher leverage of debt to equity may be achieved. Legal requirements relevant to certain investing institutions may be met by the project but not by the sponsor. C) LEASING -A adopt is a contract wherein, over the term of the lease, the owner of the equipment permits another entity to use it in exchange for a promise by the latter to make a series of payments.The owner of the equipment is referred to as the lesser. The entity that is being grant permission to use the equipment is referred to as the lessee. A typical leasing transaction works as follows. The lessee first decides on the equipment needed. The lessee then decides on the manufacturer, the make, and the model. The lessee specifies any special features desired, the terms of warranties, guarant ies, delivery, installation, and services. The lessee also negotiates the price. After the equipment and terms have 1 OFF