Dentons Paz Horowitz acted as legal structuring counsel in the USD 34 million financing granted to Banco de Machala, in a joint transaction with BlueOrchard Finance Ltd., Triple Jump, and Green Capital Partners. This transaction supports the bank’s growth strategy and strengthens its positioning within the Ecuadorian financial system, while also reaffirming the interest of international investors in the local market.

The transaction was led by Banking and Finance partners Rocío Córdova and Gabriel Solís Vinueza, who headed a multidisciplinary team responsible for the comprehensive legal structuring of the transaction, ensuring its validity, enforceability, and proper execution in accordance with Ecuadorian regulations and the financial institution’s internal policies.

Scope of Legal Advice

Dentons Paz Horowitz’s role included a thorough analysis and coordination of all key legal aspects of the transaction, including:

  • Analysis of the financing structure, to define the type of credit; review the amount, tenor, interest rate, fees, and other financial terms; assess the use of proceeds; and identify the obligors and guarantors.
  • Legal review of the borrower, including verification of Banco de Machala’s existence, good standing, and legal capacity; analysis of its corporate purpose, bylaws, amendments, appointments, powers of attorney; and compliance with corporate obligations before supervisory authorities.
  • Corporate authorizations, through the preparation and review of corporate resolutions and minutes of the competent governing body, and validation of the legal representative’s authority to execute the credit and security documentation.
  • Contractual documentation, including the review, negotiation, and structuring of the credit agreement and ancillary documents, with particular attention to financial covenants, events of default, acceleration, and penalties.
  • Security structuring, through the analysis and design of the collateral package in accordance with Banco de Machala’s requirements.
  • Regulatory and banking compliance, verifying compliance with applicable regulations issued by the Superintendency of Banks.
  • Conditions precedent and disbursement, identifying and verifying the fulfillment of conditions precedent to disbursement, reviewing enabling documentation, and providing legal support throughout the process.
  • Issuance of the legal opinion, covering the validity and enforceability of the credit documents, the borrower’s capacity and due representation, compliance with corporate authorizations, and the validity and perfection of the securities.

With this transaction, Dentons Paz Horowitz reaffirms its experience in complex, cross-border financial transactions, as well as its commitment to supporting financial institutions and investors in the development of solid, efficient structures aligned with best market practices.