Definition of commercial and industrial (C&I) loan

loan to a corporation, commercial enterprise, or joint venture, as opposed to a loan to a consumer. C&I loans can be a source of working capital, or used to finance the purchase of manufacturing plants and equipment. These loans are generally short-term, are secured by collateral pledged by the borrower or can be fully unsecured, and usually are made at flexible rates. Generally, the rate is pegged to the bank prime rate: or money market rate, such as the London Interbank Offered Rate (LIBOR). Many lenders also require borrowers to file periodic financial statements, usually annually, and meet other conditions, such as maintaining proper insurance on the loan collateral.