Banking a Deal Law and Legal Definition

Banking a deal means to lend money to one with whom the lender desires to consummate a contract, under such terms that he does not become a partner of the borrower, but a secured creditor.

Banking a deal customarily means making to a person who wishes to consummate a deal, a loan of money on collateral for a consideration. The consideration for the loan may be interest, a fee, or perhaps a part of the securities or property involved in the deal, or a combination of each or all. The result of banking a deal, therefore, is that the lender is in the position of a secured creditor, and not either of a participant or of an investor therein. [Cray, McFawn & Co. v. Hegarty, Conroy & Co., 27 F. Supp. 93, 99 (D.N.Y. 1939)].