A new escrow product has been unveiled in Mexico by Bank of America Merrill Lynch (BofA Merrill) for corporate clients.
The Controlled Account (Cuenta Controlada) service from BofA Merrill covers Mexican pesos and US dollar transactions.
In classis escrow fashion it regulates the exchange of cash among multiple parties based on agreed upon contractual provisions as specified by a client. The bank acts as an independent third party to receive, hold and subsequently disburse the funds.
Cuenta Controlada can be used to support a variety of corporate situations that involve cash only deposits. Examples include:
- Settlement of large mergers and acquisitions.
- Good faith deposits or break fees.
- Disbursement of milestone payments relating to a project.
- Deposits to secure performance guarantees.
- Holdbacks or earnings premiums in a business purchase.
- Subscriptions relating to a capital strategy.
- Legal or banking fees in a workout.
- Safekeeping and disbursement of funds relating to bankruptcy and administration.
“This is an exciting development for our clients needing controlled account services in Mexico,” said Juan Pablo Cuevas, head of global transaction services (GTS) for Latin America and the Caribbean. “Cuenta Controlada can significantly help companies manage their risk exposure and improve efficiencies. The product is supported by our integrated suite of services including the online banking portal, CashPro Online, and its numerous modules such as information reporting.”
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