Inter-Creditor Agreements Unify Creditors

Inter-creditor agreements (ICAs) are crucial in organising cross-border finance transactions involving various lenders or creditor classes funding a single borrower. The ICA delineates a definitive framework for priority, enforcement, and inter-jurisdictional cooperation, acknowledging the diverse rights, risk preferences, and legal frameworks of each creditor.

The senior creditors will seek to oversee the execution of security and any reorganisation of the borrower group. Senior creditors typically possess a more advantageous negotiation stance compared to junior creditors, making it unsurprising that the conditions of the intercreditor agreement are generally more friendly to the former than the latter.