20 Legal nature of funded participation
- 2015-08-15
- By whiggs
- Posted in Transfer of financial assets in transactions
- In conclusion the nature of the participation arrangement is that:
- the participant is not a direct party to the loan agreement governing theunderlying loan;
- the lender does not transfer or assign rights or obligations under the loan or loan documentation to the participant;
- the participant has no proprietary interest in either the loan or the loan documentation. The participant therefore has a contractual nexus with the lender only, and has no direct rights against the borrower.