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Syndicated Loans Criteria - Fundamentals A Syndicated Loan transaction is defined as a loan made available by two or more providers under a common loan agreement and ranking credit is assigned upon signature of the loan documentation. If these fundamental tests cannot be applied, it will not be considered for inclusion. Section 1 Syndicated Loans Criteria - Ranking Guidelines 1.01 Syndicated Loans rankings are published on a monthly basis, with a final year-end ranking aggregating a full year of global syndicated loan activity. Rankings are based on transaction volume in millions of US dollars. 1.02 Transactions not denominated in US dollars are converted to a US dollar equivalent at signing date. Published syndicated loan rankings are based on funding dates or signing dates, whichever is earliest. 1.03 In addition to US dollar volume, rankings indicate deal count and volume share percentage. 1.04 Rankings are measured by US dollar volume on an equal apportionment basis - each qualifying bank receives an equal portion of the deal value. Section 2 Syndicated Loans Criteria Submission Guidelines 2.01 Dealogic will provide banks with reconciliation lists on a monthly basis, and quarterly revisions and updates of the loans accredited to their institution under a title that qualifies for a published ranking table, indicating current eligibility status. 2.02 Submissions should provide the following terms with respect to each tranche: Borrower name (guarantor/sponsor if applicable) Tenor Currency and amount Instrument type Margin Fee details (facility fee, commitment fee, participation fee etc.) Lender group, titles and underwriters (if applicable) Loan purpose Deal type 2.03 Loan submissions should be emailed to Dealogic. A template submission form is available upon request. 2.04 Failure to provide the information outlined above may result in a loan being excluded from published rankings. Submission deadline dates for 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2014 Monthly deadline 24 Jan 25 Apr 25 Jul 24 Oct Monthly deadline 21 Feb 23 May 22 Aug 21 Nov First Quarterly deadline 14 Mar 13 Jun 12 Sep 12 Dec Second Quarterly deadline 21 Mar 20 Jun 19 Sep 19 Dec theloansforum Dealogic Holdings plc Page 2 of 6
2.05 Any deals signed after the First Quarterly deadline must be submitted by the Second Quarterly deadline for inclusion. 2.06 Deals signed after the Second Quarterly deadline will be accepted as and when they sign. 2.07 Market transactions, which are not yet eligible for league table credit, may be submitted and will be added to Loan Analytics at any point of the year. 2.08 Dealogic reserves the right to amend any dates as required and will send out notification of any alterations made. 2.09 Dealogic reserves the right in all disputes to determine its own transaction classification and ranking eligibility. Section 3 Syndicated Loans Criteria General Eligibility Guidelines 3.01 Ranking credit is assigned only once. If a loan is underwritten, then the initial loan agreement signing date will be used. Consequently, if two or more banks sign a loan agreement on 31st December, and the full lender group signs into the deal later, the applicable ranking credit date for all syndicate members is 31st December. 3.02 Credit is awarded at the time the loan agreement is signed. Consequently, if a loan is launched at $1bn but later signed for just $750m, the applicable credit is $750m. Conversely, if a loan agreement is signed prior to syndication and then signed following syndication at a reduced amount, the greater amount is applicable. 3.03 If a loan agreement is signed prior to syndication in the current year but, following syndication, signed in the next year for a greater amount, the amount difference only will be credited in the second year. 3.04 For inclusion of sole-led transactions that are only syndicated with institutional investors, a full list of institutional investors is required. The investor list will not be made public if specified by the bank. 3.05 Credit in rankings is given only to bank parent companies. In the case of a merger, demerger or consolidation only the surviving company will receive credit. The group head, which is the investment banking division name of the parent entity, appears in rankings. Section 4 Syndicated Loans Criteria Rank Eligibility Inclusions 4.01 Add-on loans, defined as additional new tranches, accordion features or increases to loan amounts via an option stipulated in the original loan documentation, are eligible for ranking credit. The applicable credit will be allocated only to the incremental portion of the facility. 4.02 If a facility is refinanced, restructured or amended within 90 days of the signing date of the original loan, only the facility of greater US dollar equivalent amount is rank eligible. 4.03 Amendments will receive league table credit where the primary reason for the amendment is a change to tenor, amount or margin. Titles from the previous facility will be awarded, unless changes are reported. In the case of a dispute, supporting documentation will be sought outlining the titles awarded. If specific tranches of a transaction only are amended, those tranches alone will receive league table credit. 4.04 Self-arranged deals are eligible for ranking credit. However Bookrunner credit is only awarded if a sellon has taken place as evidenced by a mandate letter, the cover page of the loan agreement or a theloansforum Dealogic Holdings plc Page 3 of 6
borrower s press release. No ranking credit is attributed to the borrower itself if deemed not to be a loan market practitioner. 4.05 Each loan supporting a bid for the same acquisition target is rank eligible. Only one loan per bidding group for the same target is eligible. 4.06 If a loan agreement is signed and fees paid on a deal that is subsequently cancelled, refinanced, amended or repaid, it will remain eligible for ranking credit. 4.07 Short term loans (with a maturity of less than 360 days) provided to satisfy the same financing requirement and renewed at maturity more than once in that year will be included, so long as there is a genuine business reason, each loan is a standalone facility and there is proven sell on. If these requirements are not met, or if the facility is trade-related, only the loan of greater US dollar amount will be eligible. 4.08 Both loans will be rank eligible when a bridge facility is taken out by a long-term facility. A loan agreement is acceptable proof for a bridge facility. If the bank provides a commitment letter only, fees must have been paid. Section 5 Syndicated Loans Criteria Rank Eligibility Exclusions 5.01 Loans with undisclosed borrowers. 5.02 Refinancings or amendments with a tenor of less than 90 days. 5.03 Co-ordinated series of bilaterals - two or more lines of credit simultaneously made available to the same borrower by banks on an individual basis. 5.04 Extensions to a deal that are written into the original documentation unless there is sufficient proof that a fee was earned on the exercise of the extension and the exercise followed an A&E format. Section 6 Syndicated Loans Criteria Bookrunner Title 6.01 Bookrunner credit is awarded if a proven sell-on has taken place, through evidence of either tiering or a mandate letter, the cover page of the loan agreement, an invitation letter or a borrower s press release. 6.02 There is no restriction on the number of Bookrunners receiving ranking credit 1. 6.03 For rank eligible loans signed prior to syndication, Bookrunners are recognised when additional banks join the transaction. A commitment letter signed by the additional banks will be accepted as evidence, provided there was a genuine syndication process. Banks may be asked to provide supporting documentation and will be judged on a case by case basis. 6.04 No Bookrunner credit will be allocated for club deals. In the case where an initial bookrunning group brings in additional banks, Bookrunner credit will be awarded if it can be proven that sell-on has taken place. 6.05 No Bookrunner credit will be awarded to Co-ordinators of club deals. The Co-ordinator will be credited at the same level as the other Mandated Arrangers. 6.06 Prefixes such as co-, senior- or lead are ignored. 1 A limitation on number of Bookrunners was implemented between 1 st January 2005 and 31 st December 2008. The rule was suspended 1 st January 2009. theloansforum Dealogic Holdings plc Page 4 of 6
6.07 Loans provided to a borrower that is majority owned or an SPV set up by the sole Bookrunner will not be eligible for Bookrunner credit. Section 7 Syndicated Loans Criteria Ranking Methodology 7.01 For region-based league tables, market type shall be used. Market type is determined according to the geographical location of the Bookrunner. In the case of a cross-border syndication where multiple Bookrunners are located in multiple regions, the region of main focus is applicable, which is defined as the region where more than 50% of the Bookrunners are located. If there is no majority, the market type will be determined by the nationality of the borrower. 7.02 Bookrunner credit is applied retrospectively once the deal has been syndicated or an invitation letter has been provided. If a loan is underwritten or prefunded by one bank only, it will not be eligible unless it also satisfies criteria 1.05. 7.03 An underwriting league table based on the initial underwriters will be published. The credit will be apportioned equally, unless actual allocations are disclosed. 7.04 For country based league tables, deal nationality shall be used. The deal nationality is the nationality of the borrowing entity, or in the case of an SPV, the parent. Where the borrower is a holding company or has a parental guarantee, Dealogic will make common sense exceptions on a case-by-case basis in consultation with market participants. Section 8 Syndicated Loans Criteria Definitions LBO/MBO Loans Buy-outs of corporates backed by private equity firms, non-private equity firms and private individuals excluding corporates and industrial holding companies. Debt to be added to the target and not assumed by the acquiror. A deal with Financial Sponsor co-involvement with a corporate will not be considered an LBO if the corporate entity owns a majority stake. Financial Sponsor Portfolio company Financial Sponsor Backed Loans Sub Investment Grade Loans A private equity investment firm that acquires existing and operating companies through a leveraged or management buyout, engages in restructuring activities for the acquired companies and eventually monetizes its positions through a sale of equity, recapitalization, secondary buyout or trade sale. A company that is acquired through Financial Sponsor investment. Loans that include a Financial Sponsor or portfolio company of a Financial Sponsor. Loans for borrowers rated BB+ or below by Standard and Poor s and/or Ba1 or below by Moody s In the case of a split rating, borrowers with a rating of 5Bs or greater (from two rating agencies) are considered Investment Grade and those below 5Bs as sub IG. Unrated borrowers from emerging markets will default to sub-ig unless documentation is provided to support investment grade status. IG tables will exclude these transactions. theloansforum Dealogic Holdings plc Page 5 of 6
Leveraged Loans Leveraged corporates with a rating of BB+ or below. For unrated borrowers, security, instrument type, financial sponsor involvement, tenor and pricing will be considered when determining the deal s final leveraged status. Dealogic will publish a sub-ig table, which will include emerging market, corporate leveraged and financial sponsor transactions. The three categories will also be published separately. Project finance transactions will be excluded from any deal type based rankings. All LBOs are flagged as leveraged as a matter of course. Trade Finance Loans are not considered leveraged. Shipping Loans Self-arranged Deal Club Deal Sell-on Loans that are used for the purchase of vessels or for borrowers in the shipping industry. Loans structured and syndicated by the borrower. Any transaction involving a pre-agreed banking group; may be tiered or not, with no sell-on. Bringing a bank into the deal that is not part of the initial banking group. Syndicated Loans Criteria Contact Details For more information regarding the 2014 Rankings criteria please contact the following members of the Dealogic Loans team. Americas Europe Dan Stefan Roody Muneean +1 212 577 4412 +44 207 440 6125 dan.stefa@dealogic.com roody.muneean@dealogic.com Asia Japan Perkins Cheung Aya Nagata +852 3698 4718 +81 3 6731 2046 perkins.cheung@dealogic.com aya.nagata@dealogic.com theloansforum Dealogic Holdings plc Page 6 of 6