An asset-based loan from Accord is an excellent way to leverage your assets to help you succeed.
The securitization markets implosion enabled non-bank and private capital to take an even greater share of the private Asset-Based Finance markets. We can provide your small business with flexible working capital financing solutions, including both accounts receivable and inventory.
Our highly experienced team works hard to understand your business and grow with youproviding support at each level of success.
5 Source: Integer Advisors estimates based on FSB and EBA data. You can count on us to consistently deliver flexible asset-based loans with speed and transparency.
Access to the benefits of (i) privately negotiated transactions where lenders often maintain an upper hand due to a less competitive market, (ii) investments backed by large diversified pools of hard and financial assets, (iii) short duration of many of the underlying loans. music, films, pharmaceutical royalties) which dont fit within approved capital frameworks. Were on a mission to be Americas small business bank.
Asset-based loan financing may be used by companies that need short-term working capital to keep day-to-day operations, like payroll, for example, up and running.
When the borrower needs additional working capital, they request an advance, and the capital is sent directly to the borrowers bank account. Your asset-based loan request will be evaluated based on the value of your collateral and your management teams experience, aiming to meet your financing needs without imposing onerous financial covenants. Find out the key differences that set Asset Based Lending apart from Bank Financing. Call us at888.999.8050, or submit the form, to connect with a team member; well be in touch with you shortly!
The financing is used to fund the growth of a pool of assets or servicing of a static pool of assets. The borrower can request as little or as much capital, depending on what their needs are at any given time. With the inclusion of Non-Performing Loans (NPLs) as well as performing, but non-core bank assets deemed saleable, the ABF market swells by an additional estimated $1.2 trillion to $5.7 trillion, today4.
The pricing of the instrument and thickness of the tranche are other important factors. Excludes loans securitized or sold to agencies and assets acquired in capital markets or via other secondary/ syndicated channels. Using relationships and trust developed over years with corporate executives, board members, and advisers, we proactively pursue investments that harness pockets of inefficiency in lending markets to drive differentiated investment outcomes.
9 Source: Attom Data Solutions, 2019 year end report and KKR Estimates. ABL gives your company the flexibility it needs to grow, recapitalize, take advantage of supplier discounts, buyout shareholders, or even to fund payroll. Asia The region encompasses the two largest non-bank economies in the world, India and China, which should rebound following a period of post-growth consolidation. This has allowed us to access acquisition opportunities bilaterally with the sellers or through auction processes. The volume of banks seeking to complete regulatory capital trades typically increases following periods of stress on financial systems such as the Financial Crisis and now, in the current pandemic. Asset-based lending, also known as asset-backed finance, ABL lending or an asset-based loan, provides your small or medium-sized business with fast, flexible financing to optimize cash flow, avoid draining savings accounts and effectively manage critical transitions. The borrower then grants SouthStar a security interest in the items being used as collateral, such as Accounts Receivable, Equipment and Inventory. Unlike corporate credit, which is typically dependent on the performance and enterprise value of a single borrower, cash flow performance of large, diversified pools of underlying hard and financial assets drive ABF returns. These are monetized through natural loan workouts and securitization take-outs.
Of course, a multi-asset approach requires that managers have a large, well-resourced global platform with investment and structuring expertise plus operations and financing resources. We are proactive to provide top-notch service. 4 Steps to Getting a Small Business Loan Without Collateral. Investment Approach: We have developed strong relationships with banks and advisors across Europe alongside a growing presence in Asia. In this piece, prepared in the midst of the COVID-19 pandemic, we speak to private Asset-Based Finances origins and the secular changes to lending markets, describe how we view the investable universe through investment case studies, and review the investment structures used to harness the opportunities.
The information in this presentation may contain projections or other forward-looking statements (which can be identified by the use of forward-looking terminology such as, but not limited to, "may," "will," "should," "seek," "expect," "target," "intend," "estimate," "believe," or other variations thereon or comparable terminology) regarding future events, targets or expectations regarding the Funds or the strategies described herein, and is only current as of the date indicated. Asset-based lending provides a line of credit based on your companys eligible: Asset-based lending offers more flexibility than other methods of financing, and is a fast and cost-effective way to obtain working capital. This field is for validation purposes and should be left unchanged. The Financial Crisis and factors that played out in its aftermath marked a dramatic end to this chapter of non-bank lending, setting it up for the recent transformation and growth. She has been an investor, entrepreneur, and advisor for more than 25 years. Asset-based finance is a specialized method of providing companies with working capital and term loans that use accounts receivable, inventory, machinery, equipment, or real estate as collateral. Leveraging the team and tech-focused platform, the goal is to start disintermediating existing broker channels and providing a direct-to-consumer offering that substantially reduces cost of customer acquisition and delivers highly attractive product economics. Examples of our themes include the Digital Economy, Bank Capital Inefficiency, and the Aging Population6. 11 Source: Deleveraging Asia, Deloitte, September 2019. Absolutely. All rights reserved. The market has been a beneficiary of the long term growth in global air transportation, driven in part by a growing middle class in the emerging markets (a core theme) and by the emergence of low cost airlines. For context, the Consumer and Small-Medium Sized Enterprise (SME) segments alone are approximately ten times the amount of global Corporate Direct Lending assets under management, one and a half times the size of the US and European bank loan and high yield bond markets combined, and nearly the same size as the investable emerging market bond market2.
Furthermore, we believe the investment is well positioned to weather significant forward losses associated with the current COVID-19 pandemic, considering it is below the projected loss threshold and has an untapped first loss cushion, in addition to excess spread. Result: Since KKRs involvement, the company has grown to become a major participant in the SFR market, enlarging rental markets in the U.S. where little or no high quality rental units were previously available. For illustrative purposes only.
Our deep knowledge and product expertise help us match you with the best solution to meet your unique needs. ares acquires Over the next five years, the Consumer and SME segments of private Asset-Based Finance alone are anticipated to grow over 50%, from approximately $4.5 trillion today to around $6.9 trillion, excluding NPLs and non-core bank assets deemed saleable, and from $5.7 trillion today to $9.5 trillion inclusive of them. Accords asset-based lending is ideal for a wide variety of industries across the United States and Canada.
Pre-crisis bank balance sheets were natural homes for Hard Assets, such as Real Estate and Aircraft. The information contained herein is as of March 31, 2020, unless otherwise indicated, is subject to change, and KKR Credit assumes no obligation to update the information herein. After the lender receives payment, he then deducts the financing cost and fees and remits the balance to the company. Information regarding the Drawbridge Fund accessed through the KKR Investor Portal is confidential and intended for Drawbridge Fund investors only. KKR has a financial and/or control interest in, and provides certain services to the Drawbridge Fund and/or its sponsor, but KKR is not the investment advisor to the Drawbridge Fund or any portfolio investment of the Drawbridge Fund.
Over the next two to three years, these banks will face increasing pressure to find new homes for these assets driven in part by increased regulatory focus (European Central Bank in particular) on the health of the wider banking system and the impact of new regulations, such as Basel IV, on bank capital models12. This presentation is furnished on a confidential basis exclusively to the named recipient of this presentation (the Recipient) and is not for redistribution.
That said, the ABF market stretches well beyond the Consumer and SME segments to include Hard Assets (e.g., Real Estate and Aviation) and Contractual Cash Flows (e.g., Royalty Financing and Life Settlements) which expand the opportunity set significantly (Aviation Leasing alone is a $360 billion segment3).
However, banks retreat over the past decade has had an equally profound impact on non-corporate activity, a segment that comprises a far larger portion of the global capital markets and real economy. SouthStar Capital will establish a revolving line of credit (revolver) to maximize the availability of working capital from the companys asset base. This includes ceasing, temporarily or permanently, new loan origination and allowing the loan book to liquidate. Jackson joined Live Oak Bank in 2018.
Top Three Benefits of Asset-Based Lending, Line of credit from $3 million to $35 million, Company or industry that is working capital intensive, Quality account debtors superior to the companys profile, Businesses that have an inventory with quality value, Turnarounds: when cash flow debt service coverage, predictability or high leverage (debt/EBITDA) does not support cash flow financing, Businesses seeking to expand borrowing capacity, Competitive AR and inventory advance rates for bulk followed line of credit, Advance rates up to 90% (accounts receivable) and competitive for inventory.
The information in this Presentation, including statements concerning financial market trends, is based on current market conditions, which will fluctuate and may be superseded by subsequent market events or for other reasons. Asset Based loans can be structured as revolving credit facilities, allowing a company to borrow from assets on an ongoing basis to cover expenses or investments as needed. Private Credit has and will continue to be a natural buyer for these assets, likely in the form of straight asset acquisitions or more bespoke structured solutions agreed on a bilateral basis. The views expressed reflect the current views of the Private Credit Team as of the date hereof and neither the Private Credit Team nor KKR undertakes to advise you of any changes in the views expressed herein.
12 Source: KPMG Impact of Basel IV on European Banks, 2018.
13 Source: Estimates based on PWC Portfolio Advisory Group projections. Live Oak Banks asset-based lending solutions offer increased borrowing availability against your working capital assets. SVP - Head of Government Contracting and Asset-based Lending, SVP - Head of Government Contracting and Asset-based Lending. It can shield managers from pressure to deploy capital during downturns or when valuations are unattractive.
Banks seek the exposure transfer with the goal of enhancing Tier I capital buffer (mainly in Europe) or transferring credit risk (mainly in the U.S.). Market Opportunity: Following the U.S. housing crisis, the aging U.S. home stock induced many to purchase homes, perform refurbishments financed by a loan, and sell the improved stock for a profit. Investments backed by cash flow producing assets such as intellectual property, royalty streams and customized financial contracts fall within this eclectic segment.
One example is the SFR business, in which consumers are able to rent a home with the option to purchase in the future.
None of KKR Credit Advisors, the Funds, the general partner of the Funds or any of their respective affiliates or employees have updated any such information through the date hereof or undertaken any independent review of such information, nor have they made any representation or warranty, express or implied, with respect to the fairness, correctness, accuracy, reasonableness or completeness of any of the information contained herein (including, but not limited to, information obtained from third- party sources) and they expressly disclaim any responsibility or liability therefore.
The securitization markets implosion enabled non-bank and private capital to take an even greater share of the private Asset-Based Finance markets. We can provide your small business with flexible working capital financing solutions, including both accounts receivable and inventory.
Our highly experienced team works hard to understand your business and grow with youproviding support at each level of success.
5 Source: Integer Advisors estimates based on FSB and EBA data. You can count on us to consistently deliver flexible asset-based loans with speed and transparency.
Access to the benefits of (i) privately negotiated transactions where lenders often maintain an upper hand due to a less competitive market, (ii) investments backed by large diversified pools of hard and financial assets, (iii) short duration of many of the underlying loans. music, films, pharmaceutical royalties) which dont fit within approved capital frameworks. Were on a mission to be Americas small business bank.
Asset-based loan financing may be used by companies that need short-term working capital to keep day-to-day operations, like payroll, for example, up and running.
When the borrower needs additional working capital, they request an advance, and the capital is sent directly to the borrowers bank account. Your asset-based loan request will be evaluated based on the value of your collateral and your management teams experience, aiming to meet your financing needs without imposing onerous financial covenants. Find out the key differences that set Asset Based Lending apart from Bank Financing. Call us at888.999.8050, or submit the form, to connect with a team member; well be in touch with you shortly!
The financing is used to fund the growth of a pool of assets or servicing of a static pool of assets. The borrower can request as little or as much capital, depending on what their needs are at any given time. With the inclusion of Non-Performing Loans (NPLs) as well as performing, but non-core bank assets deemed saleable, the ABF market swells by an additional estimated $1.2 trillion to $5.7 trillion, today4.
The pricing of the instrument and thickness of the tranche are other important factors. Excludes loans securitized or sold to agencies and assets acquired in capital markets or via other secondary/ syndicated channels. Using relationships and trust developed over years with corporate executives, board members, and advisers, we proactively pursue investments that harness pockets of inefficiency in lending markets to drive differentiated investment outcomes.
9 Source: Attom Data Solutions, 2019 year end report and KKR Estimates. ABL gives your company the flexibility it needs to grow, recapitalize, take advantage of supplier discounts, buyout shareholders, or even to fund payroll. Asia The region encompasses the two largest non-bank economies in the world, India and China, which should rebound following a period of post-growth consolidation. This has allowed us to access acquisition opportunities bilaterally with the sellers or through auction processes. The volume of banks seeking to complete regulatory capital trades typically increases following periods of stress on financial systems such as the Financial Crisis and now, in the current pandemic. Asset-based lending, also known as asset-backed finance, ABL lending or an asset-based loan, provides your small or medium-sized business with fast, flexible financing to optimize cash flow, avoid draining savings accounts and effectively manage critical transitions. The borrower then grants SouthStar a security interest in the items being used as collateral, such as Accounts Receivable, Equipment and Inventory. Unlike corporate credit, which is typically dependent on the performance and enterprise value of a single borrower, cash flow performance of large, diversified pools of underlying hard and financial assets drive ABF returns. These are monetized through natural loan workouts and securitization take-outs.
Of course, a multi-asset approach requires that managers have a large, well-resourced global platform with investment and structuring expertise plus operations and financing resources. We are proactive to provide top-notch service. 4 Steps to Getting a Small Business Loan Without Collateral. Investment Approach: We have developed strong relationships with banks and advisors across Europe alongside a growing presence in Asia. In this piece, prepared in the midst of the COVID-19 pandemic, we speak to private Asset-Based Finances origins and the secular changes to lending markets, describe how we view the investable universe through investment case studies, and review the investment structures used to harness the opportunities.
The information in this presentation may contain projections or other forward-looking statements (which can be identified by the use of forward-looking terminology such as, but not limited to, "may," "will," "should," "seek," "expect," "target," "intend," "estimate," "believe," or other variations thereon or comparable terminology) regarding future events, targets or expectations regarding the Funds or the strategies described herein, and is only current as of the date indicated. Asset-based lending provides a line of credit based on your companys eligible: Asset-based lending offers more flexibility than other methods of financing, and is a fast and cost-effective way to obtain working capital. This field is for validation purposes and should be left unchanged. The Financial Crisis and factors that played out in its aftermath marked a dramatic end to this chapter of non-bank lending, setting it up for the recent transformation and growth. She has been an investor, entrepreneur, and advisor for more than 25 years. Asset-based finance is a specialized method of providing companies with working capital and term loans that use accounts receivable, inventory, machinery, equipment, or real estate as collateral. Leveraging the team and tech-focused platform, the goal is to start disintermediating existing broker channels and providing a direct-to-consumer offering that substantially reduces cost of customer acquisition and delivers highly attractive product economics. Examples of our themes include the Digital Economy, Bank Capital Inefficiency, and the Aging Population6. 11 Source: Deleveraging Asia, Deloitte, September 2019. Absolutely. All rights reserved. The market has been a beneficiary of the long term growth in global air transportation, driven in part by a growing middle class in the emerging markets (a core theme) and by the emergence of low cost airlines. For context, the Consumer and Small-Medium Sized Enterprise (SME) segments alone are approximately ten times the amount of global Corporate Direct Lending assets under management, one and a half times the size of the US and European bank loan and high yield bond markets combined, and nearly the same size as the investable emerging market bond market2.
Furthermore, we believe the investment is well positioned to weather significant forward losses associated with the current COVID-19 pandemic, considering it is below the projected loss threshold and has an untapped first loss cushion, in addition to excess spread. Result: Since KKRs involvement, the company has grown to become a major participant in the SFR market, enlarging rental markets in the U.S. where little or no high quality rental units were previously available. For illustrative purposes only.
Our deep knowledge and product expertise help us match you with the best solution to meet your unique needs. ares acquires Over the next five years, the Consumer and SME segments of private Asset-Based Finance alone are anticipated to grow over 50%, from approximately $4.5 trillion today to around $6.9 trillion, excluding NPLs and non-core bank assets deemed saleable, and from $5.7 trillion today to $9.5 trillion inclusive of them. Accords asset-based lending is ideal for a wide variety of industries across the United States and Canada.
Pre-crisis bank balance sheets were natural homes for Hard Assets, such as Real Estate and Aircraft. The information contained herein is as of March 31, 2020, unless otherwise indicated, is subject to change, and KKR Credit assumes no obligation to update the information herein. After the lender receives payment, he then deducts the financing cost and fees and remits the balance to the company. Information regarding the Drawbridge Fund accessed through the KKR Investor Portal is confidential and intended for Drawbridge Fund investors only. KKR has a financial and/or control interest in, and provides certain services to the Drawbridge Fund and/or its sponsor, but KKR is not the investment advisor to the Drawbridge Fund or any portfolio investment of the Drawbridge Fund.
Over the next two to three years, these banks will face increasing pressure to find new homes for these assets driven in part by increased regulatory focus (European Central Bank in particular) on the health of the wider banking system and the impact of new regulations, such as Basel IV, on bank capital models12. This presentation is furnished on a confidential basis exclusively to the named recipient of this presentation (the Recipient) and is not for redistribution. That said, the ABF market stretches well beyond the Consumer and SME segments to include Hard Assets (e.g., Real Estate and Aviation) and Contractual Cash Flows (e.g., Royalty Financing and Life Settlements) which expand the opportunity set significantly (Aviation Leasing alone is a $360 billion segment3).
However, banks retreat over the past decade has had an equally profound impact on non-corporate activity, a segment that comprises a far larger portion of the global capital markets and real economy. SouthStar Capital will establish a revolving line of credit (revolver) to maximize the availability of working capital from the companys asset base. This includes ceasing, temporarily or permanently, new loan origination and allowing the loan book to liquidate. Jackson joined Live Oak Bank in 2018.
Top Three Benefits of Asset-Based Lending, Line of credit from $3 million to $35 million, Company or industry that is working capital intensive, Quality account debtors superior to the companys profile, Businesses that have an inventory with quality value, Turnarounds: when cash flow debt service coverage, predictability or high leverage (debt/EBITDA) does not support cash flow financing, Businesses seeking to expand borrowing capacity, Competitive AR and inventory advance rates for bulk followed line of credit, Advance rates up to 90% (accounts receivable) and competitive for inventory.
The information in this Presentation, including statements concerning financial market trends, is based on current market conditions, which will fluctuate and may be superseded by subsequent market events or for other reasons. Asset Based loans can be structured as revolving credit facilities, allowing a company to borrow from assets on an ongoing basis to cover expenses or investments as needed. Private Credit has and will continue to be a natural buyer for these assets, likely in the form of straight asset acquisitions or more bespoke structured solutions agreed on a bilateral basis. The views expressed reflect the current views of the Private Credit Team as of the date hereof and neither the Private Credit Team nor KKR undertakes to advise you of any changes in the views expressed herein.
12 Source: KPMG Impact of Basel IV on European Banks, 2018.
13 Source: Estimates based on PWC Portfolio Advisory Group projections. Live Oak Banks asset-based lending solutions offer increased borrowing availability against your working capital assets. SVP - Head of Government Contracting and Asset-based Lending, SVP - Head of Government Contracting and Asset-based Lending. It can shield managers from pressure to deploy capital during downturns or when valuations are unattractive.
Banks seek the exposure transfer with the goal of enhancing Tier I capital buffer (mainly in Europe) or transferring credit risk (mainly in the U.S.). Market Opportunity: Following the U.S. housing crisis, the aging U.S. home stock induced many to purchase homes, perform refurbishments financed by a loan, and sell the improved stock for a profit. Investments backed by cash flow producing assets such as intellectual property, royalty streams and customized financial contracts fall within this eclectic segment.
One example is the SFR business, in which consumers are able to rent a home with the option to purchase in the future.
None of KKR Credit Advisors, the Funds, the general partner of the Funds or any of their respective affiliates or employees have updated any such information through the date hereof or undertaken any independent review of such information, nor have they made any representation or warranty, express or implied, with respect to the fairness, correctness, accuracy, reasonableness or completeness of any of the information contained herein (including, but not limited to, information obtained from third- party sources) and they expressly disclaim any responsibility or liability therefore.