loan commitment

Also found in: Legal.

Loan commitment

Assurance by a lender to make money available to a borrower on specific terms in return for a fee.

Loan Commitment

The amount in loans that a bank will make or may be required to make in the near future, but has not yet made. Loan commitments may be open-ended or closed-ended. Suppose a bank approves two loans in a year; one is a revolving line of credit for $50,000 and the other is a business loan for $100,000. One would say that this bank has an open-ended loan commitment of $50,000 (because the principal amount in the loan, when repaid, may be borrowed again) and a closed-ended loan commitment of $100,000 (because once its principal is repaid, it no longer must be committed to that borrower). Banks must disclose their loan commitments.

loan commitment

In real estate,a formal promise by a lender to loan up to a specified amount of money, depending on the appraised value of the collateral, with additional details regarding the interest rate, term of the loan, property on which mortgage will be taken, and a date on which the commitment will expire.

References in periodicals archive ?
Bactiguard Holding (STO:BACTIB) on Wednesday announced that in order to maintain financial flexibility after the repayment of a bond loan and until a long-term financing solution is in place, the main shareholders of Bactiguard have issued a loan commitment of up to SEK50m.
Singapore made its initial loan commitment in April 2012 as part of the international effort to ensure the IMF has adequate resources to meet potential needs.
Alcentra Capital Corporation (NASDAQ Global Select Market: ABDC) said it has provided a senior secured loan commitment in the amount of USD11.
Issues have been raised whether commercial banks systematically underprice loan commitments and whether generally accepted accounting principles provide meaningful disclosure of the economics of these commitments.
assumed Schneider's obligation under the original commitment letter to pay a loan commitment fee or (2) by which Schneider was relieved of its obligation to pay that fee.
The automaker said it concluded a loan commitment with the foreign financing group to meet its fund needs in overseas markets.
At the opening of the recent CGI meeting, the Leader of the Indonesian delegation, namely Coordinating Minister for Economic and Financial Affairs Saleh Afiff, did not hesitate to express his optimism that the CGI's loan commitment for Indonesia for 1997/1998 would not decline, saying that if Japan and the United States reduced their loan commitments, the Worm Bank and the Asian Development Bank would do something to compensate for the reductions.
The extant literature on loan commitments has examined theoretically the pricing of loan commitments as contingent claims, and loan commitment as completing financial markets (Campbell 1978; Thakor 1982; James 1982; Melnik and Plaut 1986; Boot, Thakor, and Udell 1987; Berkovitch and Greenbaum 1991; Thakor and Udell 1987; Boot and Thakor 1991).
Bactiguard Holding AB (STO:BACTIB) announced on Tuesday the extension of a loan commitment of SEK130m of November 2015, until 31 December 2017
With the value of $300 million and a term loan commitment in the amount of $200 million, this new credit facility comprises of a rotating loan commitment.
M2 EQUITYBITES-March 25, 2016-NHI signs mezzanine loan commitment of USD14m
The closing of the new loan facility shows that Merck has a very good reputation among its banks owing to its strong position, and that a long-term loan commitment can be obtained with good terms and conditions despite the current financial market turbulence," said Matthias Zachert, CFO of the Merck Group.