Fintech and the syndicated loan market

Fintech and the syndicated loan market

The LMA Fintech Conference on 23 May 2019 brought together roughly 250 + bankers, lawyers, knowledge management and technology professionals to debate issues and opportunities in the syndicated loan market arising from Fintech and LegalTech.  At the same time, the LMA launched the results of their fintech survey. Suffice to say that most respondents to the survey and attendees at the conference see Fintech and LegalTech generally as a positive addition to the market, potentially providing cost and time efficiencies in loan syndication, notwithstanding that the tech may well in due course take over some of our roles. 

In the LegalTech space the use of document automation, transaction management tools, closed databases and artificial intelligence (AI) have all taken foothold to reduce time and cost inefficiency in syndicated loan transactions.  Whilst firms have used template or precedent documents in the past, technology is being explored which could produce the first draft of a full suite of transaction documents by simply filling in one questionnaire.  AI has been used for due diligence/contract review purposes particularly in secondary trading in the past (NPLs in particular) and will now be used, going forward, to read contracts for LIBOR replacement exercises.  A further potential use for AI could be to combine it with document automation eg for a repapering exercise – AI could be used to extract information from done deals which could then be automatically used by document automation systems to repaper a deal. Transaction management tools and closed databases reduce the amount of time and email traffic involved in pre and post-closing administrative tasks such as managing transaction checklists and bibles.

A bi-product of using such tools is that the metrics such systems provide, can show how long particular tasks take, who is doing them etc allowing for further investigation into how processes can be streamlined. The panellists noted that wh

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About the author:
Malti is a solicitor specialising in financial restructuring and insolvency. Malti trained at Baker & McKenzie and qualified into the restructuring, recovery and bankruptcy group there. She then worked at Taylor Wessing as a senior associate in the restructuring and corporate recovery group for a number of years, specializing in both domestic and cross-border transactions, as well as other non-contentious and advisory matters. She also experienced secondments at RBS and Zolfo Cooper (now Alix Partners).