The FFA and Corrs Chambers Westgarth will host an evening of networking in Sydney on Thursday, July 27 from 6-8:30 p.m. The program will be held at the Corrs Chambers Westgarth office in the Quay Quarter Tower at 50 Bridge Street.
Space is limited, so be sure to register here now. Additional information is available by emailing the FFA here.
While the majority of the fund structures hitting our desks in our subscription finance practice are traditional closed-ended private equity fund structures, we are seeing many more funds with open-ended features. Here we break down for you how these structures differ from a typical closed-end fund, why this structure is attractive to certain investors, and what lenders will want to be thinking about if they are putting together a financing for an evergreen fund.
In a March 16 hearing before the U.S. Senate Finance Committee, Treasury Secretary Janet Yellen explained that uninsured deposits would be guaranteed only following a determination that “the failure to protect uninsured depositors would create systemic risk and significant economic and financial consequences.” Not surprisingly, given this systemic risk qualifier, deposit uncertainty persists at funds and among institutional bank clients generally, and a move towards severing the lender-depository relationship by borrowing from one institution and maintaining the collateral accounts elsewhere continues.
Subscription lines, NAV, over-allocations ... and the connection between exercise and good health – here's what we're reading this week.
The Huntington National Bank has announced the addition of a fund finance banking team led by senior managing director Brad Boland, a well-known pillar of the fund finance community who was previously managing director of Signature’s Fund Banking Division and has had prior leadership roles at Wells Fargo and Bank of America.
The FFA announced changes to its Board of Directors, with Joe Rocco, Sammy Asoli and Jill Wilson coming aboard and Jeff Maier and Nick Mitra rotating off the board into FFA Advisory Committee roles.
The Fund Finance Association announced its 2023 awards, and Cadwalader was very well represented, with U.S. practice head Wes Misson selected for a prestigious “Annual Contribution to the Industry” award and special counsels Chris Montgomery and Joe Zeidner named “Rising Stars.”
Earlier this week, more than 200 of the top leaders in fund finance met at the first-ever FFA Global Leadership Summit.
Make-whole clauses (also known as prepayment premiums, call premiums or call protection) are provisions in financing transactions that require the borrower to make a specified payment to the lender if a loan is prepaid before the scheduled maturity. This payment is typically made by the borrower as a lump sum upon early termination and is designed to compensate the lender for the loss of the anticipated yield that lenders expect when providing (or committing to provide) the financing over a specified term. When drafting make-whole provisions it is important to consider the threshold question of whether the provision would be enforceable under the law of the contract.
Fitch Ratings has published its Subscription Finance Rating Criteria and an associated Feedback Report following the receipt of comments on the Exposure Draft published in February. Fitch notes that the final criteria is “substantively in line with the Exposure Draft although certain adjustments and clarifying language were added.” You can read more here.
Fitch will be hosting two webinars next week to go over the final methodology and changes from the exposure draft. These webinar pages also include links to the methodology and feedback report (which summarizes comments Fitch received).
U.S./Europe webinar: https://events.fitchratings.com/fitchfinalizessubscriptionfina
Asia webinar: https://events.fitchratings.com/fitchfinalizessubscriptionapac