Legal Question in Banking Law in India
Banking
Pari-Passu charge means what and how it works.
Main issue is once pari-passu is shared between two banks. one bank gets 80 % of receivables and other bank got only 20% in this case if the campany is bankrupt then the banks will have charge on the company's assets to there proportion percentage or banks need to share equally to the proportiate percentage even on earlier receivables?
4 Answers from Attorneys
Re: Banking
Pari-Passu is often seen in venture capital term sheets, indicating that one series of equity will have the same rights and privileges as another series of equity. ('of equal step' in latin)So both the banks will charge as per their ratios in receivables.
Re: Banking
Proportionately of their share.
Re: Banking
The banks share in the proportion of their respective loan share.
Re: Banking
already replied
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