- Republic Acquires Continental and Fast A/R Funding
- Ulrike Guigui Named Wells Fargo Head of Payments Strategy
- Sidley Adds M&A and Private Equity Partner Parthiv Rishi in Singapore
- Alvarez & Marsal Expands CFO Services Team to Meet Growing Demand
- MainStreet Bank Appoints Abdul Hersiburane New President
TSL Feature Articles
Click on the link below to meet some of the “difference makers” in the secured finance community. This issue of The Secured Lender celebrates those who are having a profound impact on both their communities and their organizations.
Previous TSL Articles
Main Street Loan Program Update
On April 30, 2020, the Federal Reserve updated its Main Street Loan Program (“MSLP”) terms based on thousands of comments (including comments from Secured Finance Network) submitted since the program was initially announced on April 9, 2020. Several important updates were made to the MSLP, though many changes of interest to asset-based lenders were contemplated but not fully developed in this new guidance. In particular, asset-based lenders will likely need to consider the impact of MSLP terms described below on existing financing structures, such as the pari passu treatment of collateral, which could dilute existing lender security in some cases, the continued reliance on EBITDA and risk ratings as metrics for determining borrower eligibility and the restrictions on assignments by MSLP lenders.
The Staged Return to Normal
We all want to return to normal, or the new normal, as quickly as possible. The question businesses and their stakeholders need to ask themselves is what does normal mean and how can the return be funded.
For most companies, their working capital has been depleted during the shutdown as they struggled to pay employees and keep vendors satisfied, while dealing with impacts to sales and accounts receivable.
PPPLF Update and Summary
On April 30, 2020, the Federal Reserve announced that it is expanding eligibility to participate in the Federal Reserve’s Paycheck Protection Program Liquidity Facility (the “PPPLF”) to all lenders eligible to originate Paycheck Protection Program loans. The PPPLF permits eligible PPP lenders to pledge PPP loan notes to the Federal Reserve in exchange for a low interest, non-recourse loan from the Federal Reserve in the amount of the pledged PPP loan note.
When originally announced, the PPPLF was only available to PPP lenders that are depository institutions. Now, all PPP lenders approved by the SBA, including banks, credit unions, Community Development Financial Institutions, members of the Farm Credit System, small business lending companies licensed by the SBA, and some financial technology firms, are eligible to participate in the PPPLF.
SFNet 2019 Annual Factoring Survey Analysis
The data in this Annual Factoring Industry Survey presents results from a period that now seems like a distant memory. Sitting down to write commentary was very challenging. Commenting on the past year seemed moot; and attempting to correlate or speculate on the future of our industry seems a fools’ errand.
One thing to keep in mind is that receivables factoring is a an “all-seasons competitor” in the world of finance. Factoring is a product that has been around for hundreds, if not thousands, of years, and so I am confident that it, like our economy, will weather the current stormy global conditions stemming from the pandemic. In fact, it is more likely that the industry will grow and thrive during this time of stress and uncertainty. The very design and nature of accounts receivable factoring is ideally suited for providing liquidity to businesses in times of financial, operational stress and uneven cash flow.
Aftermath means the consequences or aftereffects of a significant unpleasant event, like Covid-19. The financial system is going to experience this first-hand. No firm, whether it be bank or non-bank, will be left unscathed. The author is purposely writing this article now in order to predict that one of the many untold stories will be that the nation’s biggest banks were expecting the unexpected as it pertains to their middle-market C&I and ABL portfolios. Clearly, no bank in the country could have imagined a complete shutdown based on a virus, but what they could and did imagine was a severe depression irrespective of the cause. Not only were they expecting, but they were prepared in unexpected ways. The same cannot be said for certain community and regional banks and BDCs, which might not have had the resources, scale or wherewithal to prepare.
CARES Act Amendment Summary
On Tuesday, April 21, the Senate passed an amendment to the CARES Act that, among other things, would amend certain provisions of the Paycheck Protection Program (“PPP”), economic injury disaster loans, and emergency grants. The amendment is expected to pass the House later this week and the president has indicated he would sign it. In some ways, the amendment is as notable for some of the things it did not do – it did not create eligibility for financial services firms including community banks and secured lenders to borrow PPP loans, and it did not include rumored restrictions on larger borrower’s access to PPP – as it is for what it did do (increase funding and create a set-aside of PPP guarantees for PPP loans made by certain small and community development lenders).
Tips For Working From Home
New to working from home? Check out a few quick tips from ENGS Commercial Finance to help transition from working in-office to working at home.
Get to (Really) Know Rob Meyers
The following interview is a transcript from SFNet YoPro Committee member Avi Levine interviewing Rob Meyers, president, CCO & managing member of Republic Business Credit, in April 2020. Rob previously served as chair of SFNet's National Young Professionals Committee and spearheaded the YoPro Annual Leadership Summit, now in its third year. We hope you enjoy getting to know the industry’s young professionals.
Meet YoPro Andrew Bertolina
The following interview is a transcript from SFNet YoPro Committee member Matt Gillman, interviewing Andrew Bertolina of Finvoice in late 2019. We hope you enjoy getting to know the industry’s young professionals.
Transformational Change and Crisis Costs Weigh Heavily on Both Sides in Stressed and Distressed Retail/Supplier Relationships
Ben Nortman and Ian Fredericks of ReStore Capital examine the financial burden that consumer mandated transformation and the current crisis are imposing on both retailers and their suppliers, and how innovative financial solutions can be leveraged by both to help ensure successful outcomes in stressed and distressed environments.
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The SFNet's Women In Secured Finance Issue