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Loan Transfer Agreement Template for Saudi Arabia

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Key Requirements PROMPT example:

Loan Transfer Agreement

"I need a Loan Transfer Agreement for transferring a Sharia-compliant commercial loan from Al Rajhi Bank to Arab National Bank, with a transfer value of 5 million SAR, to be completed by March 2025."

Document background
The Loan Transfer Agreement is a crucial document used in Saudi Arabian financial transactions when an existing lender wishes to transfer their rights and obligations under a loan agreement to a new lender. This transfer must comply with Saudi Arabia's dual legal framework of civil law and Sharia principles, requiring careful consideration of Islamic finance rules, particularly regarding the prohibition of interest (riba) and excessive uncertainty (gharar). The agreement is essential in various scenarios, including bank portfolio management, debt trading, and restructuring situations. It must address SAMA regulations, Sharia compliance requirements, and include specific provisions for the transfer of both the principal obligation and any associated security interests. The document is particularly important in the context of Saudi Arabia's growing financial market and its increasing alignment with international banking practices while maintaining Islamic finance principles.
Suggested Sections

1. Parties: Identification of the Transferor (existing lender), Transferee (new lender), and Borrower

2. Background: Context of the original loan agreement and the reason for the transfer

3. Definitions: Key terms used throughout the agreement, including Sharia-compliant financial terms

4. Transfer and Assignment: Core provisions detailing the transfer of rights and obligations from Transferor to Transferee

5. Purchase Price and Payment: Details of the consideration for the transfer, structured in compliance with Sharia principles

6. Effective Date: Specification of when the transfer becomes effective

7. Representations and Warranties: Statements of fact and assurances from both Transferor and Transferee

8. Sharia Compliance: Declarations and provisions ensuring the transfer complies with Islamic banking principles

9. Regulatory Compliance: Provisions ensuring compliance with Saudi banking regulations and SAMA requirements

10. Notices: Communication procedures between parties

11. Governing Law and Jurisdiction: Confirmation of Saudi law application and jurisdiction of Saudi courts

12. Execution: Signature blocks and execution requirements

Optional Sections

1. Security Transfer: Required when the transfer includes associated security interests or collateral

2. Borrower Consent: Include when borrower's explicit consent is required for the transfer

3. Agent Provisions: Required in syndicated loans where a facility agent is involved

4. Tax Provisions: Include when there are specific tax implications requiring detailed treatment

5. Partial Transfer Provisions: Required when only a portion of the loan is being transferred

6. Confidentiality: Detailed confidentiality provisions when dealing with sensitive commercial information

7. Further Assurance: Additional provisions for future actions needed to perfect the transfer

8. Electronic Execution: Include when parties agree to electronic signature and documentation

Suggested Schedules

1. Schedule 1 - Original Loan Agreement: Copy or details of the original loan agreement being transferred

2. Schedule 2 - Transfer Details: Specific details of the loan being transferred, including amount, payment terms, and profit rates

3. Schedule 3 - Existing Security: Details of any security interests or collateral associated with the loan

4. Schedule 4 - Form of Transfer Certificate: Standard form for documenting the transfer, including all required regulatory information

5. Schedule 5 - Outstanding Amounts: Detailed breakdown of outstanding principal, profit, and other amounts

6. Schedule 6 - Required Consents: List of required regulatory and third-party consents

7. Appendix A - Compliance Checklist: Checklist ensuring compliance with Sharia and regulatory requirements

8. Appendix B - Supporting Documents: List and copies of all required supporting documentation

Authors

Alex Denne

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

Relevant legal definitions























































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Relevant Industries

Banking

Financial Services

Islamic Finance

Commercial Real Estate

Infrastructure

Energy

Manufacturing

Healthcare

Telecommunications

Construction

Transportation

Relevant Teams

Legal

Finance

Treasury

Credit Risk

Compliance

Islamic Banking

Corporate Banking

Documentation

Operations

Portfolio Management

Transaction Management

Risk Management

Relevant Roles

Chief Financial Officer

Finance Director

Legal Counsel

Sharia Compliance Officer

Banking Relationship Manager

Credit Risk Manager

Treasury Manager

Loan Officer

Corporate Finance Manager

Investment Manager

Portfolio Manager

Compliance Officer

Banking Operations Manager

Transaction Manager

Documentation Specialist

Industries








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