Banking & Finance Law

Money makes the world go round...

Nowhere is this popular adage more applicable than practising law in the banking and finance domain. This area of practice covers it all; from providing a loan to an individual, to complex financial deals for big companies.

Banking and finance is a global leviathan; its tentacles are spread over multiple jurisdictions and, with new products frequently being offered, this is an area which can only get bigger. As a banking and finance lawyer, you can look forward to long working hours, dealing with tons of paperwork, heaps of travel and getting to grips with the law in multiple jurisdictions.

What is involved in banking and finance law?

This is an area where some amount of specialisation is a must; there are too many components for a solicitor to be a general practitioner. As a lawyer in this field you will represent either the borrower or the lender and it is your job to ensure the correct documentation is completed and your clients’ interests are fully covered and protected.

A major portion of work in banking and finance is of a transactional nature. You will complete your part in the transaction and move on to the next. A return to a completed transaction becomes necessary when disputes arise. This constitutes the contentious element of a banking and finance lawyer’s work. As a lawyer in this field, you can choose to specialise in a particular class of financing. These might include: project, acquisition, asset, property, securitisation, derivatives, capital markets and Islamic finance.

Project finance normally involves making loans for various projects, whilst acquisition finance focuses on the lending of money to companies to purchase other entities. Asset finance, likewise, focuses on loans; however, it specifically relates to the purchase or leasing of big-ticket items. Securitisation involves transactions, where a lender offloads its loan portfolio to another company, whilst derivatives focus on the fixing of currency rates during a transaction. Capital markets is where a borrowing entity issues bonds to investors and another huge area is Islamic finance, which involves transactions or loans that comply with Shariah principles.

What makes a good banking and finance lawyer?

Across all modes and segments of finance, a lawyer will be required to assist with negotiations, provide assistance in structuring deals and complete due diligence checks on other parties (usually the borrowing entity).

You will also act as a mediator between parties; helping everyone to reach common terms that are satisfactory to all involved. Throughout all of this, you will have to ensure that the deal is in line with all laws and regulations of the particular jurisdictions they involve, as well as completing formalities such as registration.

You will have to analyse and predict future trends, which may have an impact on the transaction or deal, and communicate this in a clear and concise way to your clients. As such, excellent attention to detail and having an exact knowledge of the fine-print is essential.