Cayman Islands—cross border banking and finance guide
Produced in partnership with Maples and Calder
Cayman Islands—cross border banking and finance guide

The following Banking & Finance practice note produced in partnership with Maples and Calder provides comprehensive and up to date legal information covering:

  • Cayman Islands—cross border banking and finance guide
  • Loan market and developments
  • Please provide a brief overview of the current state of the loan markets in your jurisdiction and any significant recent market developments.
  • Please provide a brief overview of forthcoming changes to the law or other matters that may affect the loan markets or the responses to the questions below.
  • Lending
  • Is it necessary to obtain any consents or licenses in order to lend in your jurisdiction or enforce rights under a loan agreement and if so what is the process for obtaining the consent or license? Are there any other restrictions on lending that foreign lenders should be aware of?
  • Are there any taxes, duties or other charges associated with making loans to entities that are incorporated in your jurisdiction?
  • Are there any restrictions, controls, fees, taxes or charges on foreign exchange in your jurisdiction?
  • How is debt normally transferred in your jurisdiction?
  • Security and guarantees
  • More...

Loan market and developments

Please provide a brief overview of the current state of the loan markets in your jurisdiction and any significant recent market developments.

While there have been a number of significant financings in the local market, in particular re-financings of a number of hotel developments and local property developments, the market in the Cayman Islands reflects that of onshore jurisdictions as the vast majority of transactions involve Cayman Islands entities that are borrowing as a result of activities outside of the Cayman Islands.

The most significant lending transactions have occurred in relation to investment funds, especially to Cayman Islands domiciled private equity funds. These transactions tend to be governed by New York and English law finance documents with security taken over Cayman Islands assets being governed in many cases by Cayman Islands law (although there is no strict legal requirement for the governing law to be Cayman Islands law as the courts in the Cayman Islands generally recognise foreign law documents).

The main types of security are, in the case of funds established in the form of exempted limited partnerships, security over capital calls and more generally security over Cayman Islands equity interests either in the form of registered shares or limited partnership interests. This is particularly common where there is a 'master-feeder' structure or underlying blocker entities are used to hold assets.

In both

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