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As financing activity in the hedge fund and private equity fund space continues at a robust pace, we are seeing a significant volume of requests for more bespoke financings. Among those requests has been a steady stream of inquiries and questions from lenders regarding management fee facilities. We discuss below what a management fee line is and highlight some of the issues we frequently discuss with clients looking to provide such facilities.
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I was able to watch a good number of the sessions at the Fund Finance Association’s Virtual Conference this week and enjoyed the event. Congrats and thanks to Michelle Bolingbroke, the event planning team at Sequence, and the regional chairs and committees on a job well done. I especially enjoyed the session with Ronald Cohen; his thoughts on quantifying and measuring the societal impact of private enterprise were enlightening and worth a watch for anyone who was not able to see the session live. One of the clear themes coming out of the conference is the heavy interest and support for ESG initiatives in both the private equity and fund finance communities. While that is massively positive in its own right, I actually think this industry-wide focus will ultimately be a meaningful growth driver of NAV-oriented lending and related fund-level leverage. Hear me out on this.
In Fund Finance Friday’s 8th May edition, we took a look at the challenges facing the UK and European fund finance market and made some predictions for the future. Now, six months on, we thought it was time for a look at what’s happened in the market since then in terms particularly of pricing and liquidity and to use this opportunity to revisit and, where appropriate, to recast some of those predictions in light of what has actually developed.
This year’s Fund Finance Symposium may have felt a little different from previous years, mainly because there were far less post-networking drinks headaches, but the content was just as insightful and challenging as previous years. As always, the panel discussions were wide-ranging and incredibly enlightening, especially given current circumstances. It’s however safe to say that a few predominate themes surfaced throughout the discussions.
The Cayman Islands Monetary Authority this week issued its long-awaited Statement of Guidance on Non-Fund Arrangements (the "SOG"). The SOG provides guidance on what vehicles can be considered to fall within the categories of non-fund arrangements set out in the Schedule to the Cayman Islands Private Funds Law. Any vehicle that falls within one of these categories is not required to register with CIMA.
Scott Aleali and Jeff Maier of First Republic Bank put out another episode of “Fund Fanatics” on LinkedIn this week, this time with guest Abilash Jaikumar, Co-Founder of TresVista.
Join Alice Murray from The Drawdown on December 16 for a webinar featuring Mohit Sondhi (OakNorth) and Emilio Di Spiezio Sardo (Bluegem Capital Partners) as they discuss securing the "perfect" lending partner to weather our turbulent market conditions.
A couple of short updates as we head into the Fund Finance Association’s "Virtual Week."
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Although commercial banks have long taken the lead in fund finance lending, alternative lenders have gradually taken on a larger role in the market. This trend appears to have accelerated over the last year, partly driven by a reduction in new lending by banks and the resulting search by borrowers for new sources of capital.
In this episode of Fund Finance Friday: Industry Conversations, Ganryu Capital Partners’ Josh Bourone joins Samantha Hutchinson to provide his take on evolving fund structures, LP sentiment to fund financings and the lender landscape.
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Charles Inkeles, Head of U.S. Fund Finance at Industrial and Commercial Bank of China, joins Mike Mascia and discusses his new role and mandate at the bank, along with his recent market observations.
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