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Loan Purchase Agreement for Singapore

Loan Purchase Agreement Template for Singapore

A Loan Purchase Agreement under Singapore law is a legally binding document that facilitates the transfer of loans from one party (seller) to another (purchaser). The agreement is structured to comply with Singapore's Banking Act, Securities and Futures Act, and relevant MAS regulations. It details the terms of the purchase, including pricing, representations and warranties, conditions precedent, and completion mechanics, while ensuring compliance with Singapore's stringent financial regulatory framework.

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What is a Loan Purchase Agreement?

The Loan Purchase Agreement is commonly used in Singapore's financial sector when transferring loan portfolios between institutions. This document type is essential for secondary market loan trading and portfolio sales, requiring careful consideration of Singapore's regulatory environment, particularly MAS guidelines and banking regulations. The agreement typically includes detailed provisions about the loans being transferred, purchase price mechanisms, representations about the loan quality, and compliance with local banking and securities laws. A well-structured Loan Purchase Agreement is crucial for ensuring clean title transfer and managing risks associated with loan portfolio acquisitions in Singapore's jurisdiction.

What sections should be included in a Loan Purchase Agreement?

1. Parties: Identification of Seller and Purchaser of the loans, including registration details and addresses

2. Background/Recitals: Context of the transaction, description of the loans being sold, and purpose of the agreement

3. Definitions and Interpretation: Key terms used throughout the agreement and rules of interpretation

4. Sale and Purchase: Core transaction terms, purchase price, and completion mechanics

5. Conditions Precedent: Prerequisites that must be satisfied before completion

6. Representations and Warranties: Statements of fact and assurances from both parties

7. Completion: Process and requirements for closing the transaction

8. Post-Completion Obligations: Ongoing responsibilities after the sale is completed

9. Governing Law and Jurisdiction: Specification of Singapore law and jurisdiction arrangements

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

1. Security Arrangements: Details of any security packages when loans are secured

2. Data Protection: Provisions for handling personal data when personal information is involved in the transaction

3. Regulatory Compliance: Specific regulatory requirements when dealing with regulated entities or activities

4. Anti-Money Laundering: AML compliance provisions when required by regulatory framework

What schedules should be included in a Loan Purchase Agreement?

1. Schedule of Loans: Detailed list of loans being purchased including key terms

2. Form of Transfer Documents: Ƶ for documents required to effect the transfer

3. Completion Checklist: List of documents and actions required for completion

4. Due Diligence Results: Summary of due diligence findings

5. Regulatory Approvals: Copies of relevant regulatory approvals

Authors

Alex Denne

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

Jurisdiction

Singapore

Publisher

Ƶ

Document Type

Financing Agreement

Cost

Free to use
Relevant legal definitions



































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Industries

Banking Act (Cap. 19): Primary legislation governing banking institutions and banking activities in Singapore, including regulations on loan transactions and transfers

Securities and Futures Act (Cap. 289): Regulates financial products and services, particularly relevant if the loan purchase involves securitization or is considered a capital markets product

Moneylenders Act (Cap. 188): Governs money lending activities in Singapore, particularly relevant if the original loan was issued by a licensed moneylender

Contract Law (Amendment) Act: Provides the fundamental legal framework for contract formation, execution, and enforcement in Singapore

Civil Law Act (Cap. 43): Contains provisions relating to civil law matters including contractual rights and obligations

MAS Guidelines: Regulatory guidelines issued by the Monetary Authority of Singapore governing financial transactions and institutions

MAS Notice 632: Specific guidelines on capital adequacy requirements for banks and financial institutions

MAS Notice 637: Detailed requirements for risk-based capital adequacy for banks incorporated in Singapore

Consumer Protection (Fair Trading) Act: Protects consumer interests in transactions and ensures fair trading practices

Personal Data Protection Act 2012: Governs the collection, use, and disclosure of personal data in loan transactions involving individual borrowers

Housing Development Act: Relevant for loan purchases involving residential property financing

Exchange Control regulations: Governs cross-border financial transactions and currency exchanges

Law of Property Act: Covers the assignment of property rights, including the assignment of loan rights

Corruption, Drug Trafficking and Other Serious Crimes Act: Contains anti-money laundering provisions that must be considered in financial transactions

MAS Notice 626: Guidelines on prevention of money laundering and countering the financing of terrorism in financial transactions

Stamp Duties Act (Cap. 312): Governs the payment of stamp duties on loan purchase agreements and related documents

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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