Basel III Capital Retention Requirements: Impact on Loan Structures and Loan Documentation
Structuring Yield Protection and Increased Costs Provisions, Transfer Restrictions, Purpose Clauses, HVCRE Loans, and More
Recording of a 90-minute premium CLE webinar with Q&A
This CLE course will discuss current Basel III standards and how they have impacted the commercial lending landscape. The program will look at the impact of the standards on terms and conditions of loan structures and loan documentation provisions that have been changed by lenders to meet Basel III standards.
Outline
- Overview of Basel III requirements
- Leverage ratios
- Liquidity ratios
- Impact on the commercial lending landscape
- Loan documentation for non-real estate loans
- Yield protection provisions and increased costs clauses
- Transfer restrictions
- Purpose clauses (liquidity facility or not)
- Overview of HVCRE regulation
- Implications of avoiding HVCRE
- Applicable LTV ratio and how it is calculated
- Borrower’s equity. The 15% rule
- Loan structuring issues
- Addressing HVCRE issues in your loan documents
- Implications of avoiding HVCRE
Benefits
The panel will review these and other key issues:
- How have the Basel III capital retention requirements impacted the commercial lending landscape?
- What loan documentation provisions are of critical concern for lenders due to Basel III, and where is there room for negotiation?
- How can HVCRE loans be structured to avoid or minimize additional capital retention requirements?
Faculty
Robert J. (Bob) Graves
Partner
Jones Day
Mr. Graves represents lenders and borrowers in a wide variety of commercial financial transactions and has structured,... | Read More
Mr. Graves represents lenders and borrowers in a wide variety of commercial financial transactions and has structured, negotiated, and documented scores of senior debt financing arrangements of all types, including secured and unsecured single bank and syndicated credit agreements, multicurrency financing facilities, and acquisition financings. A significant portion of his practice focuses on workouts and restructurings of troubled credits, with particular emphasis on debtor-in-possession and exit financings. He co-chairs his firm's Banking & Finance Practice. He has written a number of articles and spoken at numerous professional conferences and seminars on commercial finance, enterprise risk management, and banking regulation and compliance.
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Ralph F. (Chip) MacDonald, III
Of Counsel
Jones Day
Mr. MacDonald is a financial services lawyer who focuses on M&As, public and private securities, governance, and... | Read More
Mr. MacDonald is a financial services lawyer who focuses on M&As, public and private securities, governance, and policy issues for clients engaged in this industry. Since 1979, he has helped domestic and international clients including bank holding companies, banks, investment banks, broker-dealers, investment managers, and fintech companies. He advises senior management and boards of directors. Mr. MacDonald also provides strategic and transaction guidance, including evolving areas such as regulatory relief and financial services policy. A growing area is the fintech industry, particularly its regulation and relationships with state, federal, and foreign regulators and traditional financial services companies. Clients range from global banks such as Citibank and BNP to regional and community banks. He often advises commercial businesses with respect to relationships and services with their financial services providers. Mr. MacDonald advises clients frequently regarding financial services M&As, asset and liability transactions, public and private securities offerings, Volcker Rule, investments and risk management, and bank, trust company, credit card, fintech, and other financial services charters.
CloseCamden W. Williams, Esq.
Attorney
Jones Day
Mr. Williams advises banks and other financial institutions on regulatory, transactional and compliance matters.... | Read More
Mr. Williams advises banks and other financial institutions on regulatory, transactional and compliance matters. He has extensive experience advising domestic and international financial institutions on regulatory reform issues relating to implementation of the Dodd-Frank Wall Street Reform and Consumer Protection Act, including the Volcker Rule and the enhanced supervision and prudential standards.
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