The lombard loan is the credit that firmly recorded in the amount provided by the Bank (creditor) to the client for the agreed period on the security of any property, or rights (various goods, jewels, securities are also included here. Therefore, in this article we decided to talk about what kind of lombard loans.
All the most important
Lombard loan is usually issued on bail. To date, the widespread lending to the security of securities received great distribution. The pure lubricinal loan is called the credit that is issued for a short time having a maximum maturity date of 1 year. As a rule, this loan is executed for up to 3 months. The borrower visits the bank to design a loan on the security of securities when it needs much money. In this case, it is not interested in the implementation of securities on the stock exchange. Lombard loan is issued between the Borrower and the Bank of the Treaty on the transfer of rights to mortgage property for the possibility of further provision of the creditor. At the time when the banking organization issues a loan for certain provision, as a rule, it takes the right from the borrower on a mortgage obligation. In this obligation, the borrower gives its right to the bank on the mortgage property that he conveys him. Those. Provides the right in case of non-fulfillment of its conditions to the bank to sell property, without referring to the court or arbitration.
Also, the client gives the right after the sale of collateral property, use the reversed funds to repay its debt to the bank. The obligation regulates information that the Bank, when not fulfilling the requirements, has the right to engage in the implementation of the laid property on the conditions established by him, as well as to act as a buyer when selling. In addition to the total amount of debt, the borrower is obliged to fully reimburse all the costs that relate to the provision of providing, invaliding debt, etc. In this case, the borrower (pledger) also carries his duties to the bank, despite the fact that the bank holds its provision. The borrower gives its right to use its property, values, as well as cash balances, or other amounts that are also in this banking organization.
Many commitments are prescribed by the Rights of the Bank to produce the rebelief of the property provided to him by the borrower. In the event that a pawnshop loan is issued on the security of any financial assets, not the goods, the borrower is obliged to transfer securities themselves, and not the right to further use. When making secured securities, the Credit contract provides for the conditions and time of transferring ownership of these securities from the mortgagor to the lender. Many banks issue loans secured by those securities that are accepted for accounting, or act as a collateral in the Central Bank of Russia. These are the papers that are guaranteed by the state, bank acceptances or commercial bills that are registered on the exchange of bonds and shares of the largest industrial banks and organizations, deposit certificates, and certificates of various investment funds.
The total amount of the loan issued, as a rule, depends on the quality of the provision: the type of securities, the difficulties in selling them in the market, the maturity date, as well as the possibility of their receipt or will be deposited on the security of the loan in the Central Bank.
Suppose it concerns commercial bills and government securities. Credit, as a rule, can be issued in the amount of up to 85% of the market price of securities. But in relation to the bonds and shares of major organizations and banks treated on the stock exchange, the loan amount will not exceed 60% of their market prices. As for savings certificates, in this case, the loan can be decorated for the entire amount of their retail cost. The main difference between the amount of the loan and the price of its collateral is called margin. If the margin decreases (in the event of a fall in the retail value of securities), then the borrower is obliged to pay off part of its debt to the bank so that the total amount of debt corresponds to the new nominal price of securities or provide the bank extra. security.
In the event that securities are not quoted on the stock exchange, an assessment of the amount of the loan issued and the value of the securities themselves will be made by the Bank itself, which in turn will take into account:
- report data, balances published in the press;
- publications in a special press service;
- assessment of the prospects for the development of the organization and quality of the governing staff.
But, as a rule, many banking organizations do not provide a loan secured by those securities that are not quoted on the stock exchange.
When making a lombard loan under the mortgage provision of bills, the total loan term should not be more than the payroll on the bill. It is also worth noting that this loan cannot exceed the term of more than one year. Among other things, it is often the banking organizations themselves make a limit of lending to their borrowers on bail bills, or other relevant papers, since, the higher the amount and time of the bill, the larger risks will be to carry the Bank when acquiring data bills and further registration on them loan.
It is also necessary to take into account the fact that the Bank has the right to provide the client to the Lombard loan and to ensure as a collateral of various commodity documents. For example: warehouse certificates, billboards, warrants, saved receipts, etc.
Lombard loans for commodity documents and goods are issued by the Bank, as a rule, in the amount of 55-70% of their nominal value of goods. That borrower who issued a loan secured by commodity documents in the event of a non-payment of debt, provides the bank to the full right to sell goods. And the amount of money reversed from the sale is to pay off the loan. In addition to the listed, on commodity documents, banking organizations take an additional commission from the borrower. It should also take into account that moment that today the pawnshop loan in pure form can be used extremely rarely. Often, securities are made on bail when designing a constant loan.
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