Banking and finance law deals with how banks and other financial institutions conduct business with borrowers. The aim in all transactions is to ensure compliance with the myriad of regulations and represent the party’s best interest.
Among the areas covered in this genre of the law are:
- Bank Lending: A personal or business loan agreement where the bank lends money to a borrower that come attached with documented repayment terms
- Property Finance: A loan is sought and agreed for the purposes of enabling a borrower to obtain a property or develop the land on which a property will be built. Typically, this will be acquired through a mortgage
- Project Finance: A longer-term, multi-phased and often multi-faceted infrastructure project that involves public services. The amount is borrowed to carry out the project to and is paid back once it starts to bring in money
- Acquisition Finance: A loan borrowed by one company to provide it with the funds to purchase another company. Leveraged finance also comes under this area, whereby a borrower lends a considerable sum of money to meet the cost of acquisition requirements without committing to paying its own money
- Assets Finances: The lender will take security over the specific assets purchased (usually considerable sums)
- Derivatives: Understanding and managing currency rates during a transaction
- Capital markets: When a transaction takes place, a borrowing entity gives bonds to investors
What do Banking and Finance Lawyers Do?
Banking and finance law consists of multiple areas that are technically-complex and constantly evolving. As a result, lawyers in this field often specialise in a particular area. A banking and finance lawyer will either represent the borrower or the lender, and the majority of their role will focus on the transactional elements of arranging deals.
Regardless of the specific area of banking and finance, lawyers in this field support with negotiations, structuring and handling financial arrangements, and conducting due diligence.
A banking and finance lawyer will need to balance compliance by adhering to all applicable laws and regulations (which are often across multiple jurisdictions) and mediate parties by helping them reach mutually-satisfactory terms.
Corporate Finance Law
Corporate finance law is an area of banking and finance law that concentrates on economics from the perspective of entrepreneurship and business. Many startups, medium-businesses looking to grow, and large companies exploring acquisition and merger options require funding.
Businesses will, therefore, be introduced to corporate finance law to obtain the necessary funds to inject capital for business operations. Governing these financial transactions is a body of law that both constructs and regulates borrowing and lending of this nature.
Corporate finance law is a comprehensive body of law that draws upon multiple other areas to structure financial deals including Contract law, Company law, Corporate insolvency law and Securities and takeovers.
International Banking and Finance Law
International banking law delves into legal issues surrounding global banking requirements, regulations and the complexities associated with understanding how these overlap and operate alongside each other.
The specific area of banking and finance law also concerns anti-terrorist laws, money laundering and financial crime prevention.
International banking law explores default, negotiations, remedies, mediation and enforcement. International banking lawyers must work with specific financial service regulations and legislation that sets out how banking clients must handle financial matters in order to comply with relevant laws.
Source: The Law Portal