SFNet’s 81st Annual Convention at the JW Marriott L.A. LIVE provided an opportunity for SFNet members to share insights on the shifting economy, swap playbooks, and begin charting what the next eighteen to twenty-four months may look like in secured finance. For lenders, advisors, attorneys, appraisers and service providers across the ecosystem, the Convention delivered what SFNet does best – networking, market intelligence and practical tools for navigating an increasingly complex environment.

As in prior years, the 2025 Convention was as dynamic in the hallways as on stage. Traditional bank ABL teams huddled with non-bank and private credit lenders to dissect capital structures. Appraisers, trade specialists and risk professionals compared field-level stories with workout officers. New SFNet Alliance Partners–from home appliances to precision manufacturing to distilled spirits–shared insights straight from their borrower bases, opening eyes to both the challenges and opportunities shaping Main Street and middle-market companies.

Small and mid-sized businesses need capital, expertise and guidance more than ever, yet many still don’t know the full extent of what secured finance lenders can provide. For both current and prospective members, the Convention served as a powerful platform for bridging that knowledge gap.

Tariff Implications Discussed
Multiple sessions drilled into the real-economy implications of tariffs, freight volatility, supply chain shifts and policy unpredictability. Lenders and trade experts walked through the operational realities of the past year, including companies front-loading inventory when tariff chatter spikes, then pulling back sharply when demand softens; domestic beneficiaries, particularly in steel and cabinet manufacturing, gaining strength even as others struggle; and rising risks of compliance lapses as importers grapple with costly rule changes.

Speakers urged lenders to broaden their diligence toolkits, recommending customs and Automated Collateral Evaluation data reviews rather than relying solely on standard inventory reporting. These tools can detect potential tariff or classification issues before they impair collateral value.

Panelists also highlighted the unexpected upside of volatility, with one survey noting 70 percent of CFOs felt that uncertainty had improved their organizations by accelerating decision-making and sharpening forecasting discipline. As one panelist said, “We launched two new products this year that wouldn’t have happened without the added pressure.” That mindset—creative solutions driven by urgency—is likely to influence the business landscape through 2026.

Alternative Approaches to Distressed Assets
One of the Convention’s most anticipated sessions addressed the rising number of distressed borrowers and the need for restructuring tools that reach beyond the reflexive “file Chapter 11” approach. With distinct yet complementary perspectives on the workout landscape, the message was clear: with elevated rates, tight margins and persistent cost pressures, more borrowers will reach a breaking point. Lenders who rely solely on Chapter 11 will encounter longer timelines, higher costs and reduced recoveries.

As 2026 approaches, lenders who can mix out-of-court restructurings, receiverships, Article 9 sales and short targeted bankruptcies will be best positioned to serve borrowers and protect their portfolios.

AI and Cyber Risks
AI and cyber risk remained central themes throughout the week. Traditional problems such as unpatched servers and misconfigured firewalls continue to inflict damage. Yet the next generation of threats is increasingly driven by AI—from deepfake voice instructions convincing staff to release funds, to highly personalized phishing that evades standard defenses, to AI-enabled manipulation of markets and data.

Speakers stressed that the greatest vulnerability is often human behavior. They urged lenders and borrowers to avoid black-box AI systems no one can explain, train employees to question unusual urgency, and prepare for a regulatory environment that will increasingly hold boards and senior leadership—not just IT departments—responsible for operational resilience. For SFNet members, the takeaway was not to fear AI, but rather insist on good governance and explainability.
 
Mentorship and Looking Ahead
Beyond market insight, the Convention focused strongly on the human side of secured finance. Mentorship sessions highlighted the importance of both senior champions and near-peer guides for early-career professionals. Members shared strategies for rebuilding team cohesion in a hybrid world, from reviving lunch-and-learn credit sessions to using social settings to deepen technical knowledge and trust. They encouraged all to view talent, culture and communication not as soft topics, but as competitive advantages.

Taken together, the Convention revealed a shared outlook for the next eighteen to twenty-four months marked by increased restructuring activity, broader use of hybrid capital solutions, ongoing trade and policy volatility, deeper integration of AI and data analytics, and a growing role for secured finance in powering small and mid-sized business growth.

Through all of this, SFNet’s value proposition remains clear. This is a community that does more than discuss risk and opportunity. It builds the tools, relationships and playbooks required to successfully navigate a volatile environment. If the 81st Annual Convention is any indication, SFNet members will enter 2026 not only prepared for complexity, but positioned to lead through it.

ChatGPT assisted in the creation of this article.