Programs -Secondary Market Long-Term Purchase Program-
As of September 29, 2009, in addition to its fixed rate lending capacity, Ex-Im Bank will permit PEFCO to purchase floating rate, long-term loans made by lenders and fund such loans using PEFCO’s Secured Notes. This development dramatically expands both PEFCO’s capacity to serve as a true secondary market provider of liquidity to Bank’s and other lenders and the price efficiency with which we are able to offer this capacity.
In effect, upon a lender’s request, PEFCO will offer to buy any long-term floating rate loan made by the lender (which loan received its Ex-Im Bank final commitment on or after September 29, 2009). PEFCO’s offer to buy such loans is made at then current market rates. PEFCO allows the selling lender to skim any loan margin in excess of the PEFCO bid price, without limitation. In addition to buying existing loans, PEFCO will provide lenders with commitments to purchase loans not yet made. PEFCO’s commitment to purchase allows capacity or liquidity constrained lenders to bid for new transactions with confidence of knowing they have a committed PEFCO take-out behind them.
In addition to its new floating rate authority, PEFCO continues to be able to offer to purchase fixed rate loans from lenders in a secondary market capacity as well. However, this capacity comes without the benefit of funding through PEFCO’s Secured Notes and, therefore, is offered selectively as funding capacity and market conditions permit.
Interested lenders are encouraged to contact PEFCO loan officers for pricing indications on both fixed and floating rate loans.
Features:- Under the Secondary Market Loan Purchase Program, lenders document the Ex-Im transaction normally, with the lender acting as the Ex-Im Guaranteed Lender.
- PEFCO can purchase the loan either on a disbursement-by-disbursement basis, as such disbursements are made, or at the end of the disbursement period, after all disbursements are made.
- PEFCO is able commitment to lenders during the bidding stage (in advance of mandate) to allow lenders to bid with confidence, knowing they have a committed PEFCO take-out.
- The floating rate loans may include embedded fixed rate conversion options which PEFCO will honor
- Lenders are entitled to earn any excess margin in the loan over the margin required in the PEFCO bid.
Secondary Long Term Loan Program Commitment Fees
PEFCO may charge a commitment fee for PEFCO's Secondary Long Term Loan Program.