- Client: UK national and resident
- Gold Value: £2 million
- Loan Amount: £1.8 million
- LTV: 90%
Enness was approached by a UK national looking to explore financing options against their assets following a period of significant market volatility. The client had recently liquidated a position in a public investment portfolio and was holding the proceeds in cash. Rather than leaving the capital unused, they wanted to explore ways of putting it to work while maintaining access to liquidity.
After discussing a number of potential structures, the client focused on a solution involving gold. The objective was to acquire and leverage the precious metal through a lender that could also provide custody of the asset during the financing period.
The key consideration was the client's attitude towards market volatility. Having recently experienced movements in public markets, they were conscious of the potential for a leveraged investment to result in a margin call if the underlying asset fell significantly in value. This made the proposed collateral, loan-to-value and lender terms particularly important.
Enness approached the market and negotiated terms with a specialist lender. The resulting facility provided approximately £1.8 million against gold valued at around £2 million, representing a 90% loan-to-value.
The lender offered a rate of less than 1% over the UK Base Rate, alongside a 0% custody fee and no arrangement fee. The structure provided the client with access to significant liquidity while allowing the gold to remain within the agreed custody arrangement rather than requiring the client to liquidate the underlying asset.
The facility demonstrates how portfolio finance can be used to unlock liquidity against investment assets without necessarily requiring the borrower to sell those assets. For clients with significant holdings, the appropriate structure can depend on the asset being used as security, the required loan-to-value and the lender's approach to collateral and margin requirements.
Enness arranges bespoke securities-backed lending solutions for high-net-worth clients seeking liquidity against a range of assets. Available structures and terms vary depending on the asset, lender criteria and the client's wider financial circumstances.
If you are considering raising liquidity against investment assets without selling your holdings, speak to a Securities-Backed Lending Specialist to discuss your requirements.
Disclaimer:
This case study is for information and illustrative purposes only and does not constitute financial advice or a recommendation. The value of gold and other investment assets can fluctuate, and securities-backed borrowing may involve margin calls, additional collateral requirements and the potential loss of collateral. Enness does not give advice on Securities Backed Lending or investments, and lender introductions are unregulated. Clients should seek appropriate independent professional advice regarding their individual circumstances.
Information contained in our case studies is for market and illustrative purposes only. In some cases, these may be made up of multiple cases and are for illustrative purposes only.
Some case studies are made up of enquiries that have come into the business, not all business completes, and the posting of a case study does not represent a completed piece of business.
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.
