Syndicated Loans Program
BC Community Futures offices share the mutual objective of supporting the economy of their respective communities and are engaged in the provision of loans to small businesses to expand economic activity in their area. This lending requires capital, as well as the willingness to accept the risk inherent in this activity. Increasingly, the capital needs of the local small business are growing in size, and are beyond the scope of regulated loan limits, or proportionately acceptable risk tolerances of an individual Community Futures office. Further, some Community Futures offices have run low on available capital to continue their basic small loan lending activities. Although locally independent, Community Futures offices are also a part of a Canada wide network of similar enterprises with a common mandate and thus the health and success of each member of the network is of importance to every member.
The Large Loan and Capital Access Syndication Pilot Project will assist Community Futures offices to obtain capital from other Community Futures offices to replenish their capital supply and to continue their normal activities of providing loans of $150,000 or less. Further, participating Community Futures offices will be able to participate in individual loans to enterprises requiring more than $150,000 but no more than $500,000.
Two types of syndicates are available:
1. CAP – Capital Access Pool – providing funds to Community Futures offices that are unable to continue their small business lending activity because of a lack of capital
2. ALLP – Access to Large Loan Pool –allowing Community Futures offices to extend loans of over $150,000 to $500,000 by having other Community Futures provide capital & share the revenue or the losses proportionately to their investment, and by coming together in a larger group, they can limit their respective risks to an acceptable level
