Our loan services mainly include pre-delivery loan, secured loan and factoring services.
Source: Golar LNG Limited
In general, as part of our leasing services, we provide pre-delivery loan services to customers who require funding to satisfy their pre-delivery payment obligations under their shipbuilding agreements. The pre-delivery loans we extend are solely to finance the purchase of vessels under our finance lease transactions, and are generally secured by corporate guarantee, the assignment of shipbuilding agreement and refund guarantee rendered by our customers.
In addition, we provide secured loan services to customers to satisfy their funding needs. We determine the loan amount, interest rate, maturity period and use of funds primarily based on our customers' creditworthiness, repayment capabilities as well as financing needs. Our loans are generally secured by our customers' vessels or assets. In certain circumstances, we also provide entrusted loan services, under which we (as trustor) provide funds to qualified financial institutions (as trustee), which then lend the funds to our customers under the terms and conditions specified by us.
We also provide factoring services on a recourse basis to other financial institutions. In a typical factoring transaction, our customer sells and assigns to us, at an agreed price, the accounts receivable due from its debtor, and we obtain the right to receive payment from its debtor. The price at which we purchase the accounts receivable from our customers is determined based on a number of factors, such as the creditworthiness, repayment capabilities as well as business and financial conditions of our customers and their debtors. We generally enter into factoring transactions on a recourse basis, whereby our customers undertake to unconditionally repurchase the accounts receivable at an agreed price under certain circumstances (e.g. expiry of the factoring period, our customers' debtors failing to settle their accounts receivable as and when they fall due, our customers ceasing their operations or having their business licences revoked, and the occurrence of events that have a material adverse impact on the operating or financial conditions of our customers).