LMA’s new leveraged loan template

The Loan Market Association (LMA) has announced the launch of a new leveraged loan template for the syndicated market, which is designed to address the need for uniformity in the sector. The explosion in European leveraged buyouts over the past five years, with total transaction values almost doubling from €18bn in 1999 to €51bn in 2003. The LMA’s new Leveraged Document should improve liquidity in the secondary loans market as well as facilitating negotiations between private equity firms and other parties when syndicating loans. According to the Bank of Scotland’s director of loans distribution, Gary O’Connor, “Standardising boilerplate terms in leveraged loan agreements speeds up the negotiation process and gives everyone more time to focus on the main issues. It also helps to increase activity in the secondary loan market because it is easier to trade in loans that have fairly similar terms.â€

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