The first blockchain solution for syndicated loan servicing has been successfully demonstrated by Synaps Loans LLC.

R3’s lab and research centre manged the proof-of-concept testing, while Credit Suisse helped arrange the participation of key agent banks and fund managers.

The solution uses Symbiont’s smart contract technology and Ipreo’s business process solution to speed up load trade settlement. Participating firms included Barclays, Royal Bank of Scotland, Scotiabank and Société Generale.

Loan investors will have direct access to an authoritative system of record of syndicated loan data. This will lead to savings by reducing the need for manual reviews, data re-entry and systems reconciliation.

“Synaps now has the majority of the functionality needed to implement blockchain technology at scale in the syndicated loan market, which enables us to move into the final stages of development,” Emmanuel Aidoo, head of distributed ledger and blockchain effort at Credit Suisse, said.

“Over the coming months we will work with Symbiont and Ipreo to implement the remaining functions to allow for distributed ledger technology to support a syndicated loan facility from origination to payoff, and work toward market adoption.”

Robert Berk, senior vice president and chief operating officer at U.S Bank Capital Markets said:

“The hugely successful testing of this technology has proven it can drive transparency and efficiency in the syndicated loan market.

“There are clear benefits to borrowers, agents and asset managers. This is certainly the most automated market solution we’ve seen to date.”

“With this project we have proven smart contracts can revolutionise the entire lifecycle of a loan,” Mark Smith, CEO of Symbiont, said, “from creation to settlement in secondary training.”

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