Standby Note Issuance Facility - SNIF

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Dictionary Says

Definition of 'Standby Note Issuance Facility - SNIF'


A type of credit facility, often a bank, that accepts an arrangement that finances projects via secondary obligations. SNIFs will guarantee payment to the lender if the borrower defaults. In this way, SNIFs ultimately act as a form of insurance for the lender.

Investopedia Says

Investopedia explains 'Standby Note Issuance Facility - SNIF'


SNIFs are used most frequently by weak borrowers of credit that pose a higher risk of default. The borrower pays the SNIF a commission in return for its secondary guarantee. SNIFs are often reported as off-balance sheet items for financial reporting purposes.



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