New Legislative Developments for Non-Banking Financial Institutions Matei Florea 12 November 2009
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Transcript of New Legislative Developments for Non-Banking Financial Institutions Matei Florea 12 November 2009
New Legislative Developments for Non-Banking Financial Institutions
Matei Florea
12 November 2009
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The Recent Past – A Time for Change
• The recent past has been rather turbulent for leasing companies and their clients, with changes abounding in legislation, practice and market conditions.
• Some of the legislative changes include:
– re-enactment of the requirement for court approval of enforcement proceedings
– changes to insolvency laws
– clarification of the provisioning regime applicable to IFNs
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The Response of Leasing Companies
• Leasing companies have ramped up efforts to adapt to the changing environment by:
– setting up specialised in-house client monitoring departments
– strengthening their debt collection teams and procedures
– lobbying for regulator involvement (e.g. regarding the booking of provisions)
– helping their clients restructure existing leasing facilities
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Debt Restructuring – The Key Questions
• Is there something to be saved?
• Is it not too late?
• Is there good faith?
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Pre-insolvency restructuring
• Key vocabulary:
– steering committee
– standstill agreement
– due diligence
– restructuring agreement
– claw-back provisions
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Other Options
• When pre-insolvency debt restructuring is not an option:
– make a plan
– declare an event of default
– start enforcement actions
– initiate insolvency proceedings
– consider criminal law charges and any other means of pressure
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Restructuring within insolvency
• automatic stay – exemptions
• available proceedings
• directors’ position
• reorganisation plan
• creditor cram down – defenses
• sale of (non-core) assets
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Multi-jurisdictional insolvency
• Council Regulation (EC) no. 1346/2000 on insolvency proceedings
– main proceedings based on concept of “centre of main interests” (COMI)
– territorial or secondary proceedings
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No cookie cutter solution
• There is no one size fits all solution
• Each situation will have to be dealt with individually
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Thank you! Questions?