loan participation
- noun
- Specialized
:
participación en préstamos
- The bank arranged a loan participation to finance the construction of the new hospital.
Examples
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The banks agreed to a loan participation to fund the new project.
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Many financial institutions prefer loan participation to spread their risk across different projects.
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Our firm invested in a loan participation for the commercial real estate development.
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Several lenders are involved in the loan participation for the commercial building.
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A loan participation allows several banks to share the risk of a large loan while maximizing their potential lending capacity.
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The consortium of banks entered into a loan participation agreement to finance the construction of the new hospital.
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Due to the size of the project, the developers secured funding through a loan participation with multiple financial institutions.
Synonyms
A large amount of money lent by several banks together to one borrower
A loan where several banks share money and risk because it is too large for one bank
How Large
62
6.7
- Specialized
1
3.8
- Specialized
Surface Forms
Morphology
Both constituents are semantically transparent — 'loan' (a borrowed amount) + 'participation' (involvement) — so a learner who knows those words can infer 'involvement in a loan' or a share of a loan. Although the phrase is specialized banking jargon, its meaning is compositionally predictable (a party taking part in providing a loan), so a B1 learner would likely grasp the basic sense.
Etymology
Loan participation comes from the simple image of several banks 'taking part' in one big loan. Imagine a loan too large for a single bank, so each bank takes a piece to 'share' the money and the 'risk', and that is why the phrase means banks jointly finance a loan.