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Clifford Chance

Clifford Chance

Case study

Loan portfolio migration for a large international bank

Using technology and specialist resources to improve quality and achieve 40% cost reduction in a due diligence project

Over the years, the team here at Clifford Chance has carried out due diligence for a range of clients. This is a crucial step for a transaction or transfer, and it must be done thoroughly and accurately.

When we acted for a banking client in an exercise involving the internal transfer of loans, one element of this project involved completing due diligence questionnaires (DDQs) for multiple loan documents. The aim of this was to highlight any restrictions on the ability to carry out the loans transfer.

1

The challenge: What were the pitfalls of the original DDQ process?

The traditional approach to due diligence involves allocating documents to lawyers who review them and complete a DDQ using a template in Microsoft Word. However, this approach poses several issues.

First, documentation provided by clients is often incomplete, missing schedules or amendment agreements, for example. The missing information results in the review being delayed while these additional documents are sourced.

Using traditional methods for the DDQ means that the completed reviews need to be returned to a central person for collation and reporting, making it the responsibility of this one person to carry out this stage of the process correctly. In addition, when the DDQs are completed by multiple people it can result in inconsistencies.

2

The solution: How was new technology introduced?

Once a draft DDQ had been agreed with the client, resources in our Global Delivery Centres developed a digital questionnaire using a secure collaboration platform that also allows users to work together online.

Using this solution allowed multiple Clifford Chance offices to work together through a shared platform and ensuring that all documents were reviewed in a consistent, time-efficient way.

We were then given access to our client's chosen file-sharing platform. This gave us the opportunity to complete an initial sense check of the uploaded documents to identify any that were missing and highlight any in a foreign language. This allowed for the missing documents to be requested as quickly as possible, causing minimal delay.

Nothing was allocated to a reviewer until all the relevant documents were available, making that stage of the process far more efficient.

Our Global Delivery Centre team then reviewed all English language documents. They also provided local counsel with access to the digital solution, allowing foreign language documents to be reviewed at the same time.

 

3

The result: What happened as a result of introducing a new approach to DDQs?

Combining the use of technology and expert resources in our Global Delivery Centre allowed us to providea high quality, cost-effective solution to the client in a collaborative and time efficient way.

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