Farming world Credits Financing.

 

GLOBAL Agrarian Trust

 

What is a structured financing?

 

It is a mechanism of intermediation of resources between investors and plaintiffs of financing.

 

It allows to set the resources aside for financing a specific business.

The financing repayment is function of the resources that generates the investment.

 

The design quality of a structured is measured according to the capacity to satisfy:

 

the investor's expectations and;

the requirements and repayment capacity of the financing plaintiffs.

 

Advantages

 

It allows to reduce or to eliminate risks derived from:

 

Risk of evaluation, derived from the complexity of analysis of diverse business units.

Risk of discretion in the handling of the funds by the part of the indebted one.

Risk of default, based on being able to structure guarantees or specific modalities of charging.

Legal risk, derived from the possibility of tender of the financed company.

 

Credit vs. Structured

 
    Traditional Product    Structured Product
  It is financed   Subject to credit   Productive process
  Assumes the risks   Financial intermediary  

Risk identified and limited (shared between suppliers, buyers, etc.)

 

Evaluation

  

Individual cash flow

  Fulfillment of the conditions for a standard cash flow
  Specification   Low   High
  Economies of scale   Does not exist (individual credit)   It exists, product of the standardization
  Titlezing of portfolios   Little probable   Possible and highly probable
  Availability of resources   Low (leverage difficulties)   High (links with the market)
 

Zone

  Restricted to its scope of influence   It can offer resources to national level.
  Interest rate   High   Low
 

Guarantees

 

Mortgage

  Letter of guarantee of the buyer, guarantees of the supplier.
  Covers   Few   Covers: SGR, agricultural insurance.
 

The importance of the trust is that it allows us to create nonconventional structures of financing.

 

Analysis

 

The objective of this presentation is to offer to the Producers of Supplies (PS) an alternative that allows them to finance through financial trust, with public or private supply, the sale of their products to their clients.

 
 

Definitions

 
Trust
 

It is a legal figure by which a person called Fiduciante, transmits the fiduciary property of determined goods to another one, called the Fiduciary, who administers these goods in benefit of third calls Beneficiaries.

 
Securitización
 

It is a financing process that consists of grouping present or future assets, homogenous or of similar characteristics, to aim to use the produced of its flows or to guarantee with such the repayment of services and title-values capital placed as much in public supply like private.

 

Scheme

 
 
     
     
 
 
 
Copyright © 2005 Global Asset Link. All Rights Reserved.