Articles

Last night the House and Senate approved a $900B next round of economic stimulus. The full text of the bill can be found here as well as a detailed summary. SFNet’s Advocacy Committee is reviewing the language and will hold an informative webinar as soon as practical in January. In the meantime, you may wish to consult your advisers. In addition to other broad reaching measures, the statute provides for:

• PPP extended through March 31, 2021
• CECL and TDR provisions potentially deferred until January 2022
• Additional allocations for EIDL Grants
• ERTC extended and expanded
• Rescission of emergency lending facilities, including MSLP, in their current form

To say a lot happened in 2020 doesn’t begin to capture what the year brought. In the economy, this included a significant increase in Chapter 11 filings for larger businesses from filings in 2019, particularly in retail. And for asset-based lenders it included a significant shift in their role in the larger bankruptcies. Asset-based lenders faced real challenges how to best protect their position and enhance the likelihood of a successful outcome. Confronted with a landscape that requires a new map to navigate, we look at what happened, how it happened and, most importantly, what should (or can) the asset-based lender do about it?

Encina Capital Partners, LLC (“Encina”) and an affiliate of certain funds managed by Oaktree Capital Management, L.P. (“Oaktree”) announced today that they have launched Encina Lender Finance, LLC (“ELF”), a new independent lender finance platform targeting commercial and consumer specialty finance companies in the U.S. and Canada.

Headquartered in Atlanta, ELF offers revolving lines of credit and term loans ranging in size from $10 - $40 million to specialty finance companies (sponsored and non-sponsored) across a wide range of asset classes including, but not limited to, asset-based lending, factoring, equipment leasing, floorplan financing, commercial real estate bridge lending, tax lien/deed financing, venture debt lending, SMB lending & merchant cash advance, middle-market private credit, charged-off debt buyers, rent-to-own consumer leasing, unsecured consumer lending and specialized student lending.

CIT Group Inc. (NYSE: CIT) today announced that its Power and Energy business served as coordinating lead arranger for approximately $200 million in financing for the 149-megawatt Big River solar power project in White County, Illinois.

The project sponsor is D. E. Shaw Renewable Investments (DESRI), a leading provider of cost-effective renewable energy across North America. DESRI is part of the D. E. Shaw Group, a global investment and technology development firm with more than $55 billion in investment capital.

SFNet, in alignment with the International Factoring Association and Equipment Leasing and Finance Association has petitioned the Small Business Administration and Department of the Treasury to amend its Interim Final Rule prohibiting financial services companies from participating in the Paycheck Protection Program under the CARES Act.  In a letter to Secretary Mnuchin and Secretary Carranza, CEO Rich Gumbrecht vigorously reinforced SFNet’s prior calls for eligibility of “these non-depository lenders [who] extend economic lifelines to small businesses and are themselves now under financial stress.”  SFNet has engaged outside resources and is continuing to work with organizations with aligned interests in conjunction with this and other matters related to the CARES Act and other relief efforts.  We encourage everyone in our community to reach out to your representatives in Congress to support this imperative.  For more information on how to do so, contact Michele Ocejo at mocejo@sfnet.com.  Please click here to view the letter.

The industry worldwide was profoundly shaken by the events of 2020, and the two-day SFNet International Lending Conference provided attendees with a broad global view of economic recovery and a deep dive into the new normal of covenants, risk management and other areas of the secured finance business.

Shared workplace operator WeWork said on Tuesday it has arranged a $1.75 billion letter of credit with Goldman Sachs (GS.N) that is in the process of being syndicated and whose funds are expected to be available in January.

The credit line is part of SoftBank Group Corp’s (9984.T) $9.5 billion bailout that was announced in October when money-losing WeWork was on the brink of running out of cash after its plans to go public were abruptly withdrawn a month earlier.

Andrew joined with the goal of bringing his upmarket sophistication and breadth of experience to the lower middle market with the goal of helping SG Credit build a real credit platform. On Monday, May 24, SG Credit Partners announced the extension of its comprehensive credit platform exclusively serving lower middle market entrepreneurs and new website illustrating its expanded capabilities.  

Runway Growth Credit Fund Inc., a leading provider of growth loans to both venture and non-venture backed companies seeking an alternative to raising equity, announced that it has expanded and amended its credit agreement with KeyBank Specialty Finance Lending and other lenders. The Revolving Credit Facility provides for borrowings up to a maximum aggregate principal amount of $215M, with an accordion feature that enables Runway Growth to increase the aggregate commitments up to $300M.

Three new banks, MUFG Union Bank N.A. (co-documentation agent and lender), Bank of Hope (lender), and First Foundation Bank (lender), join KeyBank Specialty Finance Lending (administrative agent, syndication agent and lender) and CIBC Bank USA (co-documentation agent and lender) as parties to the Revolving Credit Facility in support of the Fund's growth. 

At the 2021 annual SFNet Asset Based Capital Conference (ABCC), financial experts from four top companies gathered to discuss the economic and political outlook for the year ahead. The panel consisted of:

• Jeffery Wacker – head of U.S. ABL Originations, TD Bank Group
• David Mericle – chief U.S. economist, Goldman Sachs
• Lyuba Petrova – head of U.S. Leveraged Finance, Fitch Rating
• David Chmiel – managing director, Global Torchlight

Some key themes emerged throughout the panel discussion: 

Crestmark is pleased to announce the launch of a new division offering medical accounts receivable financing to businesses in the healthcare industry. The newly created division will be led by Ray Zilke, first vice president, division manager. Zilke is based in Franklin, Tennessee, and will report to Steven Tomasello, Crestmark executive vice president. Zilke joined Crestmark in November 2005 as an account executive for the Midwest region at Crestmark’s Troy offices. 

On June 16 & 23, SFNet’s live online Women in Secured Finance Conference will bring together women who are looking to grow professionally, share experiences, celebrate successes and advocate for each other. 

In response to feedback the WISF Committee has received from previous WISF conferences, SFNet is reimagining this year's event format by partnering with Corporate Class, Inc. to offer attendees an interactive, customized workshop focused on developing executive presence along with career progression and leadership skills.

WISF Committee chair, Paula Currie of PNC Bank, said, “After the past year of remote living and working, we all could use a recharge to help us get back in the game. This year’s WISF conference, promises to do just that! The two-day interactive workshop is facilitated by experienced and renowned instructors who will help you build the skills, tools and confidence needed to realize your full potential and take your career to the next level.”

Enhances and diversifies CIT’s funding profile with Mutual of Omaha Bank’s market-leading homeowners association banking business, a source of scalable lower-cost deposits. Extends middle market commercial banking capabilities with expanded products, technology solutions and geographic footprint, Advances strategic plan and accelerates shareholder value creation.