The Loan Market Association (LMA) has signed a MoU proposing a merger with the African Loan Market Association (Alma) from January 1, 2014.

“The whole aim is to try and improve the liquidity for the syndicated loan product across Sub-Saharan Africa,” Mike Johnston, director of the LMA, tells GTR.

The proposed integration has been approved by the boards of both organisations and the agreement is that Alma will wind up its activities. All documentation and training events currently being undertaken by the Alma will be undertaken by the LMA from January.

The LMA will create a dedicated Africa group to run the activities on the continent and all the Alma board members will become board members of the group, which already includes LMA members active in the Sub-Saharan African markets.

“The LMA was active in Sub-Saharan Africa anyway and was always going to become more active so frankly it just became the most logical thing to do, to integrate Alma into the LMA and carry on,” says Johnston.

Following the integration, existing Alma members will be required to join the LMA. However, many members of Alma are already members of the LMA – Johnston estimates between 60 and 65%.

For smaller companies that operate only in single African jurisdiction, the LMA is introducing a rate that will be reduced by an unreleased amount from its standard rate.

“It’s an acknowledgement that in Africa, obviously, there are a number of relatively small law firms that just operate in a single country and so it’s just an attempt to bring them in to the body of the family so to speak,” Johnston adds.