We are increasingly hearing from bank and non-bank lenders looking for ways to de-risk either all or, more usually, a portion of their exposure under a particular facility. It is perhaps a symptom of the current economic climate that these requests are becoming more frequent, particularly with respect to structured NAV trades. Given this increased interest in the availability and typical operation of risk sharing arrangements, this week we are collaborating with Assia Damianova, a Special Counsel in our structured finance team who deals frequently with these products, to look at the options available to lenders in the European fund finance market.
Russia’s invasion of Ukraine has demonstrated again how interconnected the political and financial worlds have become. For those of us in the private equity and finance worlds, it has also given rise to associated challenges posed by the Russia-related financial sanctions that have followed. In the fund finance market, these issues have arisen both for sponsors (who are now faced with issues around freezing the assets of sanctioned investors without being able to remove them) and lenders (some of whom have been faced with credit parties to their facilities who now have sanctioned investors in their LP roster).
This week, Diversity in Fund Finance hosted its annual teach-in event for Baruch College undergraduates in New York. Bankers and lawyers from the fund finance industry attended the event. Natasha Puri of Lloyds Bank and Nick Mitra of SG Americas Securities, LLC gave a presentation on the fund finance market generally and the nuts and bolts of a subscription financing transaction.
In September, KBRA’s Funds team attended Informa Connect’s SuperReturn conferences for Private Equity, Energy and Private Credit in New York and Global Secondaries Summit in London.
Fund Finance Partners and Ropes & Gray have co-authored an article titled, “NAV Financing: A Terrific Tool for Savvy Fund Sponsors.” The authors focus on NAV financing from the asset manager’s perspective, including reasons for asset managers to use NAV financing and some of the top business and legal points for asset managers and their investment vehicles in NAV financing transactions. Read it here.
Please be alert: the FFA announced this week that an unauthorized third-party company has reached out to FFA industry participants attempting to sell the APAC delegate list for financial gain. If you receive this email, please report it to your internal IT and security departments.
Partners Group is looking to hire a fund financing professional in its Denver office − ideally someone with at least 10 years of relevant experience at a leading bank, asset management firm or law firm.
The 2022 Cadwalader Finance Forum is just a few weeks away – on Thursday, October 27 at the JW Marriott in Charlotte. We hope you can join us for what promises to be a very informative program featuring panelists from a broad range of preeminent financial institutions, investors, industry associations and other leading organizations. Following a keynote address from former NBA standout Muggsy Bogues, we'll hear from leaders from a range of organizations. For a list of speakers and topics and to register, visit here.
Everyone is talking monetary policy as though they have been watching the Federal Reserve closely for years. Some people are even claiming to have had lunch with Paul Volcker in the ‘80s. Inflation and rising rates are a frequent topic among private equity professionals these days. Everyone seems to be auditioning for a CNBC segment (if CNBC is reading this, my professional email is in my bio). We all have seen incredible growth in the fund finance product over the last several years. With the rapid increase in interest rates in the United States and elsewhere, it’s prudent to ask what is the future of the fund finance product in a rising rate environment. To help gain some insight, Cadwalader sent out a client survey to our bank clients, “The Cadwalader Fund Finance Decision Maker Survey.” Here is what we have found.
This week the FFA held the inaugural FFA University 2.0 at Cadwalader’s offices in New York. The intensive full-day program was geared towards mid-level and more senior bankers and lawyers in the fund finance space. This interesting and educational event included a roster of seasoned presenters who are some of the foremost experts and deal makers in the fund finance space.