LMA loan documentation in Africa

The majority of English law syndicated loans are documented based on the collection of primary syndicated loan documentation produced by the Loan Market Association (LMA). LMA-based documentation is also increasingly used in the domestic markets in other Western European countries and in the Asia-Pacific region. More recently, the use of LMA-style loan documentation appears to have become more widespread in larger African transactions.

If, as expected, the interest of international banks in investment opportunities in Africa continues to grow, the influence of LMA terms is likely to become stronger, as those banks seek to impose on borrowers the terms with which they are familiar in their home jurisdictions.

The LMA has produced two collections of documentation aimed specifically at borrowers in certain African jurisdictions as well as a suite of English law loan agreements aimed at borrowers in less developed economies more generally.

This booklet outlines the evolution and usage of the LMA’s recommended forms in Europe for the benefit of those new to LMA terms. It goes on to describe the components of the LMA's facility agreements for use in Africa, highlighting the key features of each template as well as the main differences between those documents and the English law documents, on which the Africa templates are based.