A group of banks and financial technology providers have unveiled a new syndicated loan marketplace built on top of the Corda distributed ledger platform.
The list of banks involved includes BNP Paribas, HSBC, ING, State Street and BNY Mellon, with two other unnamed institutions also taking part in the initiative. Today’s unveiling from Finastra, which was formed by the merger of software firms D+H and Misys earlier this year, follows a previous pilot phase.
The project aims to create a new kind of syndicated loan market, where multiple lenders pool resources in order to fund single debtors. The idea is to use R3’s Corda platform (which saw its 1.0 version released on Tuesday) as a hub for administering loans and sharing key information on things like fees and interest rates in real-time during the lending process.
Philippe Boulas, head of financing solutions for BNP Paribas CIB, said in a statement:
“We believe that the distributed ledger is appropriate in syndicated lending to deliver one single position that is immediately updated when a contract is being handled. The Finastra-led utility, Fusion LenderComm, would allow us to share position data more efficiently and pave the way for a more fluid industrialization.”
The platform, dubbed Fusion LenderComm, already has its own official website, and while its launch date wasn’t disclosed in today’s announcement, the companies behind it are seeking additional backers – particularly lenders who would bring liquidity to the marketplace.
Fusion LenderComm’s unveiling is a notable one, given that the past year has seen a number of banks test applications for syndicated loan markets.
A proof-of-concept platform for issuing syndicated loans, spearheaded this past spring by Credit Suisse, saw participation from a variety of firms, including State Street. Credit Suisse said in August that it is planning a commercial-scale release for sometime next year.
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