Citi’s Revlon Payment Debacle Prompts New Loan Agent Protections

Banks are adding language to protect themselves as administrative agents to avoid consequences from mistaken payments after Citigroup Inc. lost its legal battle to recover half a billion dollars it accidentally sent to Revlon Inc. lenders, according to Xtract Research.

• Banks have added so-called “Revlon clawback language” to existing credit agreements in the weeks following U.S. District Court Judge Jesse Furman’s decision last month to allow creditors to keep the funds they received from Citi, Xtract analyst Jenny Warshafsky wrote in a March 2 report
• Xtract has identified four variations to the clawback provision, including language that states “the ...