Loan Purchase And Sale Agreement for United Arab Emirates

Loan Purchase And Sale Agreement Template for United Arab Emirates

A comprehensive legal agreement governed by UAE law that facilitates the transfer of loan assets from one party (seller) to another (purchaser). The document addresses key aspects of UAE banking regulations, including Central Bank requirements and possible Sharia compliance considerations. It covers the sale mechanics, purchase price determination, representations and warranties, transfer of security interests, and post-completion obligations. The agreement includes specific provisions for UAE regulatory compliance, necessary approvals, and local registration requirements, while incorporating both conventional and Islamic finance principles where applicable.

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What is a Loan Purchase And Sale Agreement?

The Loan Purchase And Sale Agreement is a critical document used in the UAE financial sector for transferring loan portfolios between institutions. It is particularly relevant in scenarios involving loan portfolio sales, debt trading, bank restructuring, or strategic asset disposals. The agreement must comply with UAE Central Bank regulations, Federal Law No. 14 of 2018, and other relevant financial regulations. When used in the UAE market, special attention must be paid to local registration requirements, Sharia compliance (if applicable), and specific transfer mechanisms recognized under UAE law. The document typically includes detailed schedules outlining the loan portfolio, security arrangements, and necessary regulatory approvals, making it suitable for both conventional and Islamic financial institutions operating in the UAE.

What sections should be included in a Loan Purchase And Sale Agreement?

1. Parties: Identification of the seller and purchaser of the loans

2. Background: Context of the transaction and brief description of the loan portfolio being sold

3. Definitions and Interpretation: Definitions of key terms and interpretation rules for the agreement

4. Sale and Purchase: Core transaction terms including the agreement to sell and purchase the loans

5. Purchase Price and Payment: Details of the purchase consideration and payment mechanisms

6. Conditions Precedent: Conditions that must be satisfied before completion of the sale

7. Completion: Process and requirements for closing the transaction

8. Seller's Representations and Warranties: Warranties regarding the seller's authority, loan portfolio, and compliance

9. Purchaser's Representations and Warranties: Warranties regarding the purchaser's authority and capacity

10. Transfer Mechanics: Procedures for transferring the loans and related security

11. Post-Completion Obligations: Ongoing obligations after the sale completion

12. Confidentiality: Provisions regarding confidential information

13. Notices: Communication procedures between parties

14. Governing Law and Jurisdiction: UAE law as governing law and jurisdiction provisions

What sections are optional to include in a Loan Purchase And Sale Agreement?

1. Islamic Finance Compliance: Required when the loan portfolio includes Sharia-compliant facilities

2. Security Transfer: Required when the loans are secured and security interests need to be transferred

3. Servicing Arrangements: Required when the seller will continue to service the loans post-sale

4. Data Protection: Required when personal data is involved in the transfer

5. Foreign Exchange Provisions: Required when the loan portfolio includes multiple currencies

6. Tax Provisions: Required when specific tax implications need to be addressed

7. Central Bank Approval: Required when the transaction requires UAE Central Bank approval

8. Regulatory Compliance: Required when specific regulatory requirements apply to the transfer

What schedules should be included in a Loan Purchase And Sale Agreement?

1. Schedule 1 - Loan Portfolio: Detailed list and description of the loans being sold

2. Schedule 2 - Form of Transfer Instruments: Templates for transfer documentation

3. Schedule 3 - Completion Requirements: Detailed checklist of completion deliverables

4. Schedule 4 - Seller's Power of Attorney: Form of power of attorney for post-completion actions

5. Schedule 5 - Loan Documents: List of all relevant loan documentation being transferred

6. Schedule 6 - Security Documents: Details of security arrangements and documentation

7. Schedule 7 - Purchase Price Calculation: Methodology and calculations for the purchase price

8. Appendix A - Form of Notice to Borrowers: Template for notifying borrowers of the transfer

9. Appendix B - Regulatory Approvals: Copies or details of required regulatory approvals

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Publisher

Genie AI

Document Type

Sales Agreement

Sector

Sales

Cost

Free to use
Relevant legal definitions
Clauses
Relevant Industries

Banking

Financial Services

Investment Management

Asset Management

Islamic Finance

Private Equity

Debt Trading

Corporate Finance

Financial Technology

Investment Banking

Relevant Teams

Legal

Finance

Treasury

Risk Management

Compliance

Islamic Banking

Credit

Portfolio Management

Investment

Due Diligence

Corporate Finance

Documentation

Asset Management

Relevant Roles

Chief Financial Officer

Head of Legal

Senior Legal Counsel

Treasury Manager

Portfolio Manager

Credit Risk Manager

Investment Director

Compliance Officer

Islamic Finance Specialist

Transaction Manager

Senior Banking Lawyer

Finance Director

Asset Manager

Due Diligence Officer

Portfolio Analyst

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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