by Edward C. Kelleher
Syndicated loans totaling almost $1.3 trillion in 11 currencies are being tracked and serviced by eight leading agents banks using Loan/SERV, DTCC’s suite of services that is automating the processing of syndicated loans on a global basis.
Loan/SERV currently links eight major agent banks with more than 2,400 investment funds and bank lenders through its Reconciliation Service. The service enables banks and lenders to view and reconcile loans at all levels, from commitment and transaction level down to the individual contracts and fees, with all relevant transaction detail. Six new agent banks are expected to begin processing syndicated loans through Loan/SERV in the next few months.
Accurate loan data
“Loan/SERV is bringing a whole new level of service and automation to the syndicated loan market,” said Atilla Karasapan, managing director of Citi. “The Reconciliation Service is providing lenders with the most accurate and up-to-date information available on their loan positions on a daily basis. At the same time, Reconciliation enables lenders and agent banks to quickly identify position discrepancies before they become problems.
“As more lenders and banks link to Loan/SERV, this will build critical mass, further facilitate market expansion and help boost accuracy on a market-wide basis,” Karasapan said.
Currency denominations processed by Loan/SERV include the U.S. dollar, the British pound sterling, the euro, the Danish krone and the Swedish krona. Other currencies are the Swiss franc, the Norwegian krone, the Canadian dollar, the Australian dollar, the Turkish lira and the South Africa rand. Loan/SERV can process more than 50 currencies.
New agents banks
“We expect continued growth in the coming months as we bring new agent banks online with Loan/SERV and handle additional volume from existing European clients,” said Mathew Keshav Lewis, DTCC vice president, European Loans Product Management. Lewis said that the 2,400 lenders now served by Loan/SERV represented more than half the global syndicated loan market located in 39 countries across North America, Europe, Asia and Africa.
The eight global banks linked to Loan/ SERV are The Bank of New York Mellon, Barclays Capital, Citi, Credit Suisse, Deutsche Bank, Goldman Sachs, J.P. Morgan and The Royal Bank of Scotland.
In early 2011, DTCC will begin piloting a cash settlement service called Cash on Transfer with a number of global loan agents, trading desks and administrators. Cash on Transfer will give the global syndicated loan market its first deliveryversus- payment platform, ensuring that cash settles simultaneously with the change in legal ownership of the asset recorded by agent banks. It will handle cash settlement in more than 50 currencies.
Loan/SERV is a service offering of DTCC Loan/SERV LLC, a subsidiary of DTCC. @ [For more information on Loan/SERV in North America, contact Dave Perry, DTCC manager, Product Management, at dperry1@ dtcc.com or 212.855.2345; for Europe, the Middle East, Africa and Asia, contact Rita Virdee, DTCC manager, Product Management, at email@example.com or 44 (0)207.650.1425.]