Who Is Pari Passu?

Pari-passu is a Latin phrase meaning "equal footing." In finance, "equal footing" means that two or more parties to a financial contract or claim are all treated the same. ... Wills and trusts can also assign an in pari-passu distribution where all the named parties share the assets equally.

What is pari passu in banking?

Pari-passu—Latin for “equal footing”—is a financing arrangement that gives multiple lenders equal claim to the assets used to secure a loan. If the borrower is unable to fulfil the payment terms, the assets can be sold, and each lender receives an equal share of the proceeds at the same time.

What is pari passu India?

The pari passu principle means that all unsecured creditors in insolvency processes, such as administration, liquidation and bankruptcy must share equally any available assets of the company or individual, or any proceeds from the sale of any of those assets, in proportion to the debts due to each creditor. ...