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MARKET NEWS

November 2009 - Guidelines - Know Your Customer (KYC)

Bank Debt Requirements for Counterparties and Agent Banks

These Know Your Customer (KYC) Guidelines have been published by the Loan Syndications and Trading Association, Inc. (LSTA) to increase the efficiency of account on-boarding and the ongoing approval process.  These market standards have been determined to perform KYC investigations, designed to identify clients and counterparties and ascertain relevant information pertinent to doing business with them.

NOTE: While it is the intention that this list be all-inclusive, there may be instances in which additional documentation is required.  Individual entities may have differing views with respect to these guidelines. 

Please note that while proof of address of the institution that is the subject of the KYC review process (Institution) is not set forth as a requirement within the links below, there are a few agents and counterparties that will insist upon verification of the business address of the Institution.  If requested, compliance can be met by providing any of the following documents, provided such document is (i) dated within the past twelve months and (ii) contains both the legal name and address of the Institution:

  • An invoice from or to the Institution (for example, a utility bill or a phone bill)
  • Press release
  • News article
  • Government issued document
  • Copy of a lease (for example, a lease agreement or a contract of leasing equipment)

Further, note that if an annual report or audited financials are not available because the Institution has been formed within the past twelve (12) months, any of the following documents, in lieu of such annual report or audited financials, can be provided in order to be compliant with the request:

  • Quarterly report
  • Bank references directly from Institution’s bank and performance of an independent verification of such reference
  • Operating Agreement
  • Subscription Agreement
  • Offering Document / Prospectus
  • Charter

In addition, if the Institution is managed by either a  Fund Manager or a  Registered Investment Advisor for which information has not previously been provided, click on the respective link and submit the required documentation of such Fund Manager or Registered Investment Advisor.

Please determine the category of your Institution, click on the appropriate link below and provide the required documentation set forth therein.

 

Hedge Fund CLO Registered Investment Advisor (RIA)
Mutual/Pension Fund Special Purpose Vehicle (SPV) US Bank
Managed Account Private Equity Fund Foreign Bank/Offshore Bank
  Fund Manager