Banking and Finance Law

Banking and Finance Law

Banking and Finance as a practice area essentially involves the lending and borrowing of money between those that provide funds (banks, investment funds, finance companies, etc.) and those you borrow the money (companies and individual). The practice area can be divided into four different subdivisions:

Asset Finance is the lending of money to a borrower in order to buy an asset such as a ship, aircraft or machinery;

Project Finance is the lending of money in order to fund an infrastructure project where the loan is then paid back by the money raised by the project itself;

Real Estate Finance is the lending of money in order to fund the acquisition of property or its redevelopment; and

Acquisition Finance is the lending of a large sum of money to a company so that it can buy another company and includes leveraged buyout finance where the borrower uses mostly the lenders money and little of their own capital to buy the company.

In the CNMI, there is some asset financing, some project financing, a fair amount of real estate financing, and very little acquisition financing. But attorneys who practice Banking and Finance should be familiar with all four subdivisions.

On a day-to-day basis, a lawyer practicing Banking and Finance may be expected to carry out due diligence for their client to ensure that any borrowers will be able to repay the money. A lawyer will also have to ensure that the borrower complies with specific procedures, for instance, concluding a deal at a board meeting so that it is properly signed and witnessed and having mortgages properly notarized with a translation offered in the indigenous languages so that the mortgages can be recorded. And, as banking is a regulated industry, the lawyer for a bank will have to make sure the bank complies with all local and applicable federal law related to truth in lending.

The lawyer practicing Banking and Finance may also be required to negotiate the terms of loans or financing agreements with the other party’s representatives to help both parties arrive at a mutually agreeable set of provisions. This is particularly true when representing the borrow.

The Dotts Law Office is experienced in Banking and Finance. Michael Dotts sat as a Board Member of the Bank of Saipan for more than five years and represented that Bank and its shareholders in various litigation. In addition, the Dotts Law Office has been involved in a number of transactions where financing was a key issue.