Barker’s Post

New Year, New TMF Group Capabilities. If you're a #PrivateCredit / #DirectLending fund manager and you are performing your #FundAdministration and/or #LoanAdministration in-house, perhaps an #Outsourcing conversation would lead to more efficient, lower-cost and investor-preferred operations. Please contact any of my colleagues below to discuss how this solution can help LPs feel more secure and save your GP time and money. David Grant | Devin Vasquez | Darrell Pisarra | John Harnett | David Goldstein | Kim Tran | Gerard Smith

🔍 Challenges in Scaling Loan Against Mutual Funds Following our last post on the opportunity in the Loans Against Mutual Funds, a few asked what’s holding institutions back from tapping into this Rs. 10 lakh crore market, especially when the current outstanding is only around Rs. 50,000 crore. Here’s the Real Challenge: Implementation Complexity Integration Time 🔄: For a seamless implementation of LAMF, institutions need to integrate with both CAMS and KFintech to access mutual fund data, as not all fund houses are serviced by a single entity. This integration can take anywhere from 8 to 10 months per firm. Cost Viability 💰: Integrating with MF Central could streamline this process, but then the issues of cost-effectiveness and additional integration time arise, making it less feasible for many. But That’s Why We Exist: Finsire’s Solution 🌟 Faster Integration: Finsire's Loan Against Mutual Fund Stack cuts down the integration time dramatically — think a couple of months vs. the typical 8-10 months. Simplified Management: With Finsire, managing the entire lending process from origination to loan management and collateral management for mutual funds becomes much more streamlined. Looking Ahead 🚀 Deployment takes time, but in the next three years, it’s expected that almost every financial institution will have the capability to offer LAMF digitally—it’s becoming essential. We're excited to see many, like City Union Bank Ltd., already going live with Finsire's system at Global Fintech Fest, and we have at least eight more in the pipeline. 😉

Formal Credit outstanding for the following assets: Loans against Mutual Funds: ~ 18K Crs Loans against Demat securities: ~ 16K Crs Loans against Gold Jewelry: ~ 1.1 L Crs The market can beat the high operating costs, non-digital, unreliable, fungible, and cartel-led industry of gold loans.

In the right circumstances, net asset value (NAV) loans are an excellent option for private equity funds looking to create liquidity and flexibility at the end of a fund's life cycle. I recently authored a blog post on NAV loans with my SVB colleague Dirk Engelbert, CFA. Check out the article to learn how funds can strategically use NAV loans and please reach out if you have any questions. https://lnkd.in/gKumQKek #fundfinance #privateequity #privateequityfunds #privateequityfirms

𝐒𝐈𝐏, 𝐒𝐢𝐩, 𝐇𝐨𝐨𝐫𝐚𝐲! 𝐂𝐥𝐢𝐞𝐧𝐭𝐬 𝐆𝐞𝐭 𝐂𝐚𝐬𝐡 𝐖𝐢𝐭𝐡𝐨𝐮𝐭 𝐆𝐢𝐯𝐢𝐧𝐠 𝐘𝐨𝐮𝐫 𝐀𝐔𝐌 𝐚 𝐇𝐞𝐚𝐫𝐭 𝐀𝐭𝐭𝐚𝐜𝐤! Once upon a time in the bustling world of finance, advisors and clients faced a common foe—liquidity. Whenever clients needed quick cash, they had no choice but to raid their investments, disrupting their beautiful, steady SIPs and losing the magic of compounding. A tragic tale, right? But then, like a fintech superhero, IFANOW swooped in with a solution fit for the modern advisor: Loan Against Mutual Funds (LAMF). And this wasn’t just any loan—this was liquid gold! With LAMF, clients and advisors unlocked a treasure chest of benefits: 𝗔 𝗴𝗼𝗹𝗱𝗲𝗻 𝗶𝗻𝘁𝗲𝗿𝗲𝘀𝘁 𝗿𝗮𝘁𝗲 𝗼𝗳 𝟭𝟬.𝟱% —way better than those pesky short-term loans lurking in the shadows. 𝗔𝗻 𝗲𝗮𝘀𝘆, 𝗼𝗻𝗹𝗶𝗻𝗲 𝗽𝗿𝗼𝗰𝗲𝘀𝘀 𝗮𝘀 𝘀𝗲𝗮𝗺𝗹𝗲𝘀𝘀 𝗮𝘀 𝗮 𝗺𝗮𝗴𝗶𝗰 𝘀𝗽𝗲𝗹𝗹 —quick credit straight to the bank, no quests or paperwork. 𝗡𝗼 𝗱𝗿𝗮𝗴𝗼𝗻𝘀 (𝗼𝗿 𝗰𝗿𝗲𝗱𝗶𝘁 𝗰𝗵𝗲𝗰𝗸𝘀) 𝘁𝗼 𝗳𝗶𝗴𝗵𝘁 —just fast access to funds with no declarations needed. 𝗙𝗹𝗲𝘅𝗶𝗯𝗹𝗲 𝗿𝗲𝗽𝗮𝘆𝗺𝗲𝗻𝘁 𝗼𝗽𝘁𝗶𝗼𝗻𝘀 —because a financial adventure should be smooth, not stressful. And a shiny LAMF wallet for multiple withdrawals whenever liquidity was needed! But that wasn’t all—there was even more magic in store for advisors: 𝗡𝗼 𝗺𝗼𝗿𝗲 𝘂𝗻𝘄𝗮𝗻𝘁𝗲𝗱 𝗿𝗲𝗱𝗲𝗺𝗽𝘁𝗶𝗼𝗻𝘀! SIPs could continue growing uninterrupted, letting the magic of compounding work its wonders. 𝗔𝗨𝗠 𝗽𝗿𝗼𝘁𝗲𝗰𝘁𝗶𝗼𝗻, guarding against those dreaded last-minute redemptions. 𝗖𝗼𝗺𝗺𝗶𝘀𝘀𝗶𝗼𝗻𝘀 𝗸𝗲𝗽𝘁 𝗿𝗼𝗹𝗹𝗶𝗻𝗴 𝗶𝗻 𝗼𝗻 𝗽𝗹𝗲𝗱𝗴𝗲𝗱 𝗺𝘂𝘁𝘂𝗮𝗹 𝗳𝘂𝗻𝗱𝘀 —so advisors didn’t have to stop earning just because clients needed cash. 𝗘𝘅𝘁𝗿𝗮 𝗿𝗲𝘃𝗲𝗻𝘂𝗲 𝗼𝗳 𝘂𝗽 𝘁𝗼 𝟮% 𝗼𝗻 𝗲𝘃𝗲𝗿𝘆 𝗹𝗼𝗮𝗻 𝗱𝗶𝘀𝗯𝘂𝗿𝘀𝗲𝗺𝗲𝗻𝘁 —because why settle for less? And the ultimate power: advisors could set their own interest rates, turning them into rate-setting wizards while protecting their clients’ investments. With LAMF, clients no longer had to pull the plug on their SIPs just to handle a cash crunch. Their investments continued to compound quietly in the background, while they accessed liquidity whenever they needed it—like having your cake and eating it too. Advisors rejoiced, AUM was safe, clients were happy, and the world of finance suddenly felt a lot less stressful. 𝐖𝐢𝐭𝐡 𝐈𝐅𝐀𝐍𝐎𝐖’𝐬 𝐋𝐀𝐌𝐅, keep the SIPs growing, protect your AUM, and add a little extra to your bottom line—without ever losing that magic compounding effect! 𝗥𝗲𝗮𝗱𝘆 𝘁𝗼 𝗷𝗼𝗶𝗻 𝘁𝗵𝗲 𝗟𝗔𝗠𝗙 𝗿𝗲𝘃𝗼𝗹𝘂𝘁𝗶𝗼𝗻 𝘄𝗶𝘁𝗵 𝗜𝗻𝗱𝗶𝗮'𝘀 𝗺𝗼𝘀𝘁 𝗹𝗼𝘃𝗲𝗱 𝗙𝗶𝗻𝘁𝗲𝗰𝗵 𝗯𝗿𝗮𝗻𝗱?𝙂𝙚𝙩 𝙨𝙩𝙖𝙧𝙩𝙚𝙙 𝙬𝙞𝙩𝙝 𝙄𝙁𝘼𝙉𝙊𝙒’𝙨 𝙇𝙤𝙖𝙣 𝘼𝙜𝙖𝙞𝙣𝙨𝙩 𝙈𝙪𝙩𝙪𝙖𝙡 𝙁𝙪𝙣𝙙𝙨 𝙩𝙤𝙙𝙖𝙮, visit ifanow.com and let’s keep your clients’ wealth compounding and your revenue growing, cheers! -Sagnik #EarnMore #LAMF #IFANOW #GROW10X #SIP #MF #CompoundingEffect #NoRedemptions

“For investors, the higher-for-longer [interest rate] environment has provided what some are calling the ‘golden era’ for private credit.” – Randy Schwimmer, Co-Head of Senior Lending. Randy and Mattis Poetter, Partner and Co-CIO of Arcmont Asset Management, sat down to discuss the growing popularity of private credit in the U.S. and in Europe, the evolution of the asset class and what it may look like in the months ahead. Despite shocks and volatility, the market remains stable, with strong investor appetite for consistent returns and a focus on custom-made credit solutions. Looking ahead to 2024, we expect: - A less crowded market - Normalized conditions - Cross-border opportunities ► Curious about the rapid growth of private credit and where future opportunities may lie? Read the full interview to learn about the key factors driving growth. https://lnkd.in/euFuUBxy

2/3 Part 2 of my blog for Day one of the Fund Finance Association Global Symposium 2024 in Miami: Those higher overall yields may be what inspired Goldman Sachs to jump into the committed line market with the acquisition of part of Signature’s loan book (though the bank told me they’ve always offered committed lines, the purchase at least represented an expansion of it’s business there). The addition of players with lower funding costs – insurance firms and banks like EverBank, which is backed by a consortium of private equity firms – also means increased competition. Both borrowers and lenders are becoming more focused on the discreet services and products that fit with their strategies, rather than trying to be everything at once. “Not every lender works for every borrower. And not every borrower works for every lender, anymore, either,” one CFO of a private equity firm told me at the welcome reception on Monday night at the Fontainebleau Miami. That means getting a transaction done is more work for both parties. But with differentiation often comes innovation. Capital markets solutions for fund finance are sure to be among the hot topics at this year’s confab. And, perhaps surprisingly, it is not being driven by lenders’ needs to open up balance sheets and diversify their loan books so much as by borrowers’ needs. The exception for now being credit risk transfers and guarantees, which are increasingly popular among bank lenders – check out Tom Auchterlonie’s report we put out this morning. As an example, law firm Fried Frank has been involved in arranging total return swaps and reverse repos as alternatives to NAV loans, for which borrowers can find more attractive pricing (after more initial work) since banks get better capital treatment on such instruments. Other privately-placed securitization style products have also been used to obtain longer-term financing for GPs (more on this at a later date). #fundfinance Fried Frank Thrivent JPMorgan Chase & Co. https://lnkd.in/gfp8UPk8

Understanding Credit Tranching in Asset Securitization In the financial structuring world, asset securitization is key to transforming illiquid assets (like mortgage or auto loans) into tradable securities. This process involves credit tranching, which effectively stratifies risk and aligns investor appetites with appropriate security layers. What is Credit Tranching? Credit tranching divides securities from a homogeneous asset pool into various risk levels, each known as a “tranche”. This structure allows investors to choose securities that match their risk tolerance and investment objectives. How Does It Work? 1. Asset Pooling: Similar assets (e.g., mortgages, car loans) are pooled to back the issued securities. The regular payment inflows from these assets are the primary source of cash flow. 2. Issuing Tiered Securities: Securities are issued in layers: • Senior Tranches: Safest, with the highest credit ratings (AAA to AA), offering lower returns due to lower risk. • Mezzanine Tranches: Mid-level risk and returns, rated A to BBB. • Subordinated Tranches: Highest risk, potential for higher returns, typically rated BB and below. • Equity Tranches: Absorb the first losses; potentially the highest returns if underlying assets perform well. Objectives of Bond Tranching • Risk Distribution: Matches securities with investors’ risk profiles, allowing a choice between stability (senior tranches) and high potential returns (equity tranches). • Enhanced Liquidity: Makes non-tradable assets marketable, improving liquidity in the financial markets. • Optimized Capital Costs: Lowers financing costs by attracting diverse investor bases through risk stratification. Credit tranching not only diversifies risk but also enhances the efficiency and attractiveness of securities in the capital markets. This innovation is crucial for investors looking for tailored risk-return profiles in their portfolio. Why It Matters? Tranching plays a pivotal role in financial markets by providing structured investment opportunities that cater to a wide range of risk tolerances. It exemplifies how sophisticated financial practices can facilitate the efficient allocation of capital and diversification of risk in a complex market environment. Stay ahead of the curve by understanding the dynamics of asset-backed securities and how they can be leveraged in investment strategies for both conservative and aggressive investors. #AssetSecuritization #FinancialStructuring #InvestmentStrategies #RiskManagement #CapitalMarkets

Unlock the power of your financial portfolio with VestorCorp's unique Private Equity Loans — the gateway to maximizing returns while maintaining security through collateral-backed investments. Monthly interest payments keep your cash active, and with our short loan terms, you're poised for new opportunities. Dive into the world of hard money lending, underpinned by our in-house real estate expertise and a commitment to protect your investment every step of the way. #InvestSmart #WealthGrowth #RealEstateInvesting  

MetLife Investment Management takes a unique approach to securities lending, focusing on liquidity, capital efficiency, and a strategic "mismatch" reinvestment. This method aims to generate superior and consistent income streams. For a deep dive into their strategy, download the full report now: https://lnkd.in/gJiNrJwU #SecuritiesLending #InvestmentManagement #MetLifeInvestmentManagement #InsuranceAUM