Companies with large balance sheets and with access to a diverse asset base, are usually found to be Providers of Bank Guarantees. These Providers are Larger Family Offices, Hedge Funds, Private Equity Funds, Sovereign Wealth Funds and certain institutions with large cash balances, and are located in international financial centres in Europe, the Middle East, the Far East, and South East Asia.
Collateral Transfer is the technical term for a Leased Bank Guarantee, and by utilising their asset base as collateral, the Provider(s), can offer Bank Guarantees, to companies who wish to lease these instruments, and for this purpose, both companies must enter into a contract, referred to as a Collateral Transfer Agreement.
A Collateral Transfer Agreement is where the Provider sends a Bank Guarantee to another company, (the Beneficiary), for a temporary period of time, usually one year. The Provider, under the Terms and Conditions of the Collateral Transfer Agreement, will receive a Collateral Transfer Fee from the beneficiary as payment for the use of their Bank Guarantee.
The provider will usually utilise their underperforming assets or those with a small coupon or interest rates to provide the Collateral Transfer market with Bank Guarantees. The benefit to the Provider for this service is the Collateral Transfer Fee, which enhances the overall return of the underperforming asset.
IntaCapital Swiss, has close financial relationships with many Providers and Provider Groups, and together, utilising their unique financial model, the Collateral Transfer Facility, which employs Bank Guarantees, are able to offer companies suffering with cash flow problems, access to loans and lines of credit, alluded to as Credit Guarantee Facilities.