In Practice

The UK’s second batch of Sukuk and the question of Shariah compliance: exclusion clauses v due diligence

In this In Practice article, UK and international legal authority on Islamic financial law, Dr Lu’ayy Minwer Al-Rimawi, questions the excessive use of exclusion clauses in the UK’s latest Sukuk issuance to exclude liability for Shariah compliance.

Financial covenants for fast-growth businesses: the new market norms

Financial covenants in investment grade and leveraged finance loan agreements are now well established. However, a different set of concerns are now covered by covenants being developed in relation to non-bank funding of fast-growth businesses. This In Practice article considers the terms of those fast-growth covenants.

The EU’s AML blacklist and SSPEs

Although still in the “scrutiny” period at the time of writing, EU legislation to add the Cayman Islands (and other jurisdictions) to its list of high risk third countries for anti-money laundering and counter terrorist financing is giving pause for thought and is likely to come into effect shortly after the time of publication. There are potential implications for financial transactions – especially securitisations using Cayman Island SPVs.

The ESG revolution in funds finance

There has been something of a revolution in ESG (Environmental, Social and Governance) in the funds finance industry over the past several years. For large private equity sponsors an ESG linked capital call or subscription line facility is now becoming more of the norm than the exception. Increased awareness of the importance of ESG and in Europe, the implementation of various regulations that promote measurement and adoption of ESG favourable practices, have been the greatest factors in this growth. Investors in funds now require disclosure by fund managers prior to closing a fund on what their ESG policy and strategy is when deploying capital.

Overview of anticipated focus areas for BBLS litigation

The government’s Bounce Back Loan Scheme (BBLS) provided small businesses with quick access to funding during the coronavirus pandemic. However, significant claims volumes are now anticipated given the combination of large numbers of applicants, standardised terms and a unique (and homogenous) application process. As collection and recovery activities begin, we consider some possible areas of focus for claims against BBLS lenders.

Fund finance: the securitisation question

Does a transaction in the European fund finance market constitute a “securitisation” under EU and UK securitisation regulatory frameworks? The answer impacts the potential regulatory capital treatment and liquidity of the financing and, accordingly, the pricing that lenders may be able to provide. Funds need to be aware of this question and the regulatory implications across Europe.

Core-plus infrastructure and leveraged financing: the continued convergence of terms

In this In Practice article, the author sets out some of those terms more commonly being sought by infrastructure funds for the debt financing of their assets, which traditionally would have been more commonly seen in the PE/leveraged buyout debt market.

The Bank of England’s first ever bail-in recognition

In this article, Carl Baker considers the Bank of England’s decision to recognise the bail-in of loans to PrivatBank, a Ukrainian bank resolved in accordance with Ukraine’s resolution regime.

Is it time to review your “standard” increased costs clauses in facility documentation?

With the advent of the final stage of Basel III implementation (often referred to as Basel IV), it is time again for lenders and borrowers to consider the formulation of “boiler plate” increased costs clauses in their existing credit documentation and future transactions. In this In Practice article we highlight some of the potential interactions the latest reforms may have with commonly seen drafting both in the UK and the US and discuss some of the devices which borrowers and sponsors may use to mitigate the likelihood of being on the receiving end of an increased costs claim in the future.

Section 32 Limitation Act: an evolving yet difficult route for claimants