- Client: Monaco Resident, Danish National
- Loan amount: £4,000,000
- Structure: Interest only, 4-year term
- Rate: 2.5% over base rate
- Arrangement fee: 0.75%
Enness was approached by a Danish national and Monaco resident who was looking to raise £4 million using securities-backed lending. Rather than selling investments to release capital, the client wanted to retain ownership of their securities while accessing liquidity for their wider financial requirements.
The international nature of the client’s circumstances meant flexibility was particularly important. The facility was structured over four years on an interest-only basis, with drawings available in USD, EUR and GBP. This allowed the client to access funds in the currency most appropriate to their requirements.
Enness worked with its network of specialist lenders to identify a suitable provider for the size and structure of the facility. The final terms provided a £4 million facility at 2.5% over base rate, with a 0.75% arrangement fee. The facility also included a 1% non-utilisation fee on any undrawn balance.
The structure gave the client the flexibility to draw funds as required rather than having to take the full facility immediately. Once an amount was repaid, however, it could not subsequently be redrawn, making the structure and anticipated funding requirements important considerations when arranging the facility.
For international clients with significant investment holdings, securities-backed lending can provide access to liquidity without requiring investments to be sold. The right structure will depend on the securities being offered as collateral, the borrower’s circumstances and the lender’s criteria.
This case demonstrates the flexibility that can be achieved when the facility is negotiated around the client’s wider requirements. By considering the client’s international position, preferred currencies and anticipated use of the funds, Enness was able to secure a structure tailored to the way the client intended to use the facility.
If you are considering using an investment portfolio to raise liquidity, Enness can explore the securities-backed lending options available for your circumstances. Speak to a Securities-Backed Lending Specialist to discuss your requirements.
Securities-Backed Lending Disclaimer: Enness does not provide advice on Securities-Backed Lending or investments. Lender introductions are unregulated. The terms referenced in this case study are transaction-specific and may not be indicative of current or future pricing.
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Property values can fall as well as rise, and you may not get back the amount originally invested. Property investments can be illiquid and may take time to sell. Where borrowing is used, your property may be repossessed if you do not keep up repayments on a mortgage or other loan secured against it.
