To attain the best results, it is critical to maximise returns by efficiently managing your costs, irrespective of your position in a transaction, whether it is as an investor, vendor, or business owner. It is easy to say than execute, given the changing economic conditions and the complexity of the transactions and the speed at which they occur.
Understanding Corporate Finance
Corporate finance is the area of finance that deals with the capital requirements for business expansion and the financial products to help you with the necessary money to maximise efficiency and meet your business’ strategic objectives.
Some leading banks like DBS offer unmatched corporate finance services to their customers, which are more than those offered by banks traditionally, by pushing boundaries and acting like a business partner.
Capital structuring, funding resources for projects, investment choices, and accounting are all part of the corporate finance sector. With reliable corporate finance services, you can make better choices regarding capital efficiency and financing, for these expert services support you in managing risk or return trade-offs.
What Makes Corporate Finance Essential?
Companies need finance for short-term and long-term financial activities, and corporate finance helps acquire funds from the appropriate sources. It devises a strategy for the business to use and manage capital to increase value. With a suitable plan for capital structure and budgeting, you can manage risk and increase profitability.
Financial products like a capital budgeting tool offered by corporate finance services enable you to assess future cash flows anticipated from investments. They determine the most affordable funding options or the ideal ratio of equity to debt in the capital structure. Working capital requirements are considered for day-to-day business operations.
The best corporate finance service helps clients with a wide range of products, solutions, and services to raise capital by borrowing money or issuing securities. Some of them in the project and syndicated finance can help realise the company’s strategic objectives like:
- Mergers and acquisitions (M&As) and financing and advisory service for projects, particularly brownfield or greenfield projects
- Establish relationships by syndication, deal structuring, and executing financing structures through a proper financial solution.
Get to Know Some Corporate Financing Solutions
With global corporate finance services from experts like DBS, you seek comprehensive advice and financing for projects obtained through M&A or projects, mostly greenfield or brownfield ones.
Global expansions help a business enterprise experience rapid growth. With varying regulations and operations in different countries across the world, establishing or expanding your business operations in another part of the globe poses serious challenges. It calls for building advisory relationships with experts, who have extensive knowledge, good business acumen, and considerable experience.
- Project Finance
Banks providing corporate finance services are known to work closely with their customers to find innovative ways in the initial stage of the project to realize their investment objectives. There is an experienced and dedicated team that makes it possible to adopt a thoughtful and customised strategy to get the best outcomes while making investments. It includes:
- Understanding your requirements
They evaluate your financial condition and study your organizational goals and objectives before considering possible scenarios.
- Defining your corporate objectives
With appropriate asset structuring and capital budgeting solutions and recommendations for tailored wealth management, they select an investment philosophy after assessing it.
- Assessing and following your objectives
They periodically assess your assets’ condition, review your goals, and make any necessary changes. Further, they also help manage the assets, carry out the chosen service, and perform regular monitoring of risk and performance.
- Benefitting from expertise
You can seek the essential advice, necessary structuring knowledge, and required finance due to the vast experience and proven track record these banks provide. They include identifying and allocating risk based on the interest to support long-term projects sustainably.
- Syndicated Finance
With a loan syndication solution, banks finance big businesses that look for adequate capital for large projects. Such type of syndicated finance is offered by a group of banks and not by one lender or bank, for such a lender or bank finds it extremely difficult and entails more risk to fulfil the huge capital requirement of the borrower.
For instance, DBS Syndicated Finance is a principal arranger for loan syndication in Asia. With a team of bankers specialized in large-scale deal structuring and syndication, as well as execution of financing structures, including asset-backed financing, leveraged buyouts, acquisition loans, and regular or structured corporate loans in various markets across the region.
Get to Know What Syndicated Finance Is
Collaboration and working together of lenders through a leading arranger, syndicate agent, or financial institution, who administers, controls, and manages financial transactions, like club loans, fees, and repayments to help a large and important borrower to meet its financial needs is called syndicated finance or loan syndication. The lenders share the returns and risks between themselves in the process, as it is beyond a single bank’s or lender’s capability.
Mergers and acquisitions and leveraged buyouts call for a large amount of money that is generally not possible to provide by a single lender. Syndicated finance comes into play in such a situation in corporate finance for such transactions. The liability of a lender is extended to the amount of money lent. Nevertheless, they are bound by the same terms and conditions, except for the collaterals.
Syndicate agents are the financial entities in charge of managing and coordinating the loan syndication agreement. They are responsible for managing loan monitoring, repayments, fees, compliance reports, etc.
Various Benefits of Syndicated Finance
Some of the advantages of going for loan syndication are:
- Funding requires less effort and time.
- Building a positive reputation in the industry is advantageous for borrowers.
- The financing is being administered quite effectively.
- Borrowers have options for pricing and structure.
- The loan has a set purpose and duration.
- Lenders are capable of executing complex deals due to their strong syndication capabilities and customised solutions
- The borrower is not required to visit every bank or submit separate applications to every bank.
Corporate finance is a crucial component of any firm, but startups require it more than any other for their need to raise quick money for projects. It necessitates organising and managing finances effectively. Corporate finance refers to most of a company’s financial operations, such as raising capital, managing risks and investing.
