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Asset-Backed Finance

BciCapital closes hybrid aftercare facility while expanding into CLOs

BciCapital pairs hybrid aftercare innovation with rising demand for mid-market CLO solutions

BciCapital has closed a U$75m hybrid aftercare structured credit facility for a major alternative asset manager with more than U$50bn in assets under management, SCI has learned. At the same time, the firm continues to scale its mid-market CLO financing platform, recently closing a U$50m borrowing-base facility for a manager.

The hybrid financing will provide end-of-fund-life working capital to support the monetisation of remaining US and European portfolio assets over the next 12 to 24 months. BciCapital - which acted as sole lender, bookrunner and administrative agent - structured a hybrid collateral package blending capital-call support with NAV elements, a design well-suited to aftercare financing. Raul Llanes, executive at BciCapital, notes that the manager was navigating the last stretch of the fund’s lifecycle with a handful of remaining assets and required incremental liquidity to optimise exit timing.

He adds that while hybrid aftercare solutions have long been part of the fund finance toolkit, they have grown more relevant as portfolio realisations have slowed across the market. “Managers are turning to more innovative structures to adapt to elongated exit timelines,” he says.

While the identity of the manager remains confidential, Llanes confirms this specific fund once surpassed U$1bn in capital commitments and maintained a broad, diversified asset pool, as deep existing ties with the manager across multiple strategies further strengthened BciCapital’s role in the transaction.

The deal team included Llanes; Brian Mulligan, co-head of institutional sponsors; vps Matthew Schwartzman and William Payne; and Normando Diaz, portfolio management officer.

Building momentum in mid-market CLO financing

Based in Miami, BciCapital also recently closed another U$50m borrowing-base facility for a CLO manager (which remains confidential) with mid-teens billions in AUM. The deal fits the firm’s effort to broaden its CLO debt and equity financing capabilities. In this transaction, the deal team included Llanes; Jorge Garcia co-head of institutional sponsors; vps Joshua Cohn and Adam Grossel; and Fernando Cardozo, portfolio risk officer.

Speaking to SCI, Llanes describes this part of the firm’s strategy of expanding its “product sets, which includes… CLO debt and equity”, while targeting “the mid-market to largest market managers, such as Ares, Sound Point, Fortress, Carlyle, Oak Hill [and] others.”

The borrower - active across both CLO debt and equity - sought liquidity against a 40-Act fund structure with limited existing leverage. Bci structured a senior credit facility with a preferred-equity toggle, giving the manager “working capital to smooth transactions on a quarterly basis” and enabling follow-on CLO purchases. The borrowing-base approach lets the manager recycle capital efficiently as positions are added or redeemed.

While the underlying fund spans hundreds of CLOs and thousands of loans, Bci focused heavily on the borrower’s long track record in selecting high-performing CLO equity sponsors. Llanes says: “Choosing the CLO manager to invest into is critical - you’re also choosing the manager and the legacy.” Diversification by sector and manager was central to Bci’s comfort, given recent macro shifts.

Llanes notes that the firm continues to stand out by focusing on transactions in the U$20m–US$250m range, well below the typical thresholds for larger deals handled by major banks. BciCapital’s multi-product financing platform - spanning senior and subordinated NAV structures, as well as preferred-equity combinations - has enabled multiple repeat facilities, including this borrower’s fourth financing.

With CLO yields still attractive, liquidity is returning and managers are looking for ways to unlock capital. Llanes says the trend is clear: “If you can get comfortable with the underlying collateral… being able to shift with them and help them unlock liquidity, so they can continue investing is critical.”

The latest facility underscores a growing pipeline as more funds seek leverage solutions that remain compliant with 40-Act and Registered Investment Company regulations constraints.

Marina Torres, Ramla Soni

CLOs

CLOs: Surging issuance in Europe - video

Kartesia's Htun speaks to SCI about key themes shaping the CLO market and the outlook for 2026

Michael Htun, head of CLOs at Kartesia, speaks with SCI’s Solomon Klappholz about the key themes shaping the CLO market in 2025 and what to expect in 2026. Htun reflects on recent market performance, the trends impacting CLO investors today, where he sees relative value amid broad spread compression, and what the divergence between tight mezzanine spreads and firm equity levels means for the market.

Solomon Klappholz

ABS

Breaking new ground with Europe's first multi-country public auto deal

AUTO1's FinanceHero 2 points to potential for more multi-country issuance

AUTO1 Group’s Q3 completion of Financehero 2, the first European public securitisation to pool auto instalment purchase receivables from multiple jurisdictions, points to the potential for further multi-country issuance. The €249m transaction, backed by German and Austrian receivables, is a step forward from last year’s debut Financehero 2024-1, according to Linklaters, which advised on both deals.

FinanceHero 2 achieved 3.6x subscription and priced at an average margin of one-month Euribor+87bp, with the senior notes rated triple-A and certified STS. Its 2024 predecessor set the foundations for the sequel transaction, Jördis Heckt-Harbeck, a partner in Linklaters’ structured finance practice, tells SCI. “FinanceHero 2024-1 was really the inaugural deal and the first instalment-purchase transaction of its kind in Germany,” she says.

The key work on the debut deal involved helping rating agencies understand the product’s mechanics. “They needed to understand how things work – how they differ from loans,” Heckt-Harbeck says, “in order to apply the relevant metrics and their grading criteria.” These efforts during FinanceHero 2024-1 created a foundation that allowed the second transaction to be more straightforward, allowing the structurers to focus on the multi-jurisdictional elements rather than the fundamentals of the asset class.

While the core structure has remained largely unchanged, the major innovation in FinanceHero 2 is the integration of two separate country portfolios. “For the first time, they combined portfolios originated by two different companies operating under two different regimes,” says Heckt-Harbeck. For rating agencies, this was a new aspect to the deal and required careful alignment to ensure the issue was rated fairly. 

The decision to merge the German and Austrian portfolios was ultimately driven by execution efficiency rather than structural experimentation. As Heckt-Harbeck explains, consolidating the assets into a single take-out was the most practical way to refinance the existing warehouse: “It’s much more efficient to do one transaction than two. AUTO1 like innovative structures and are not afraid of exploring unchartered grounds.” 

With the Austrian pool representing a smaller share of the collateral, a standalone deal would have required a longer ramp-up period and delayed the refinancing. Folding both jurisdictions into one structure therefore unlocked earlier and cheaper access to the public markets. 

Investor reception suggests that combining portfolios did not hinder demand. Initially, Linklaters considered whether the structure would enhance or complicate the marketing phase. However, this concern was alleviated, Heckt-Harbeck says, as “the deal was essentially spoiled in terms of demand” with questions from investors around the two-portfolio setup reportedly being minimal.

Looking ahead, Heckt-Harbeck expects more issuers to consider similar structures. However, she stresses that success depends on operational consistency across jurisdictions. “You need to be honest about whether the business is sufficiently streamlined in the relevant jurisdictions,” she says. “Ultimately, it’s several deals folded into one.”

Matthew Manders

ABS

Australia eyes debut data centre securitisation

Issuance anticipated within next 12 months

Australia is to capitalise on growing demand for digital infrastructure with its first data centre securitisation within the next 6-12 months, according to market participants. The anticipated deal would position it ahead of several neighbours in the broader region.

Louise McCoach, partner at Dentons, says the market is in a "pre-launch phase" with substantial preparatory work underway. "The market's holding its breath. We think that there'll be something in the next 6-12 months and beyond that, maybe a window of 12 to 24 months for broader market adoption and follow-on deals," she tells SCI.

However, McCoach notes that whilst the US leads globally and Europe has “brought a handful of deals to the market recently ", Australia remains one of the countries where it is very much a nascent asset class. “We haven't done one yet, but there's a lot of talk," she says.

Market observers widely expect AirTrunk, backed by Blackstone, to lead the charge with an ABS issuance, though no formal deal has been announced. The transaction would position Australia ahead of much of Asia-Pacific in tapping securitisation for data centre financing, despite the broader region showing growing interest in the asset class. 

Investment in Australian data centres is projected to reach approximately A$46bn by 2029, representing 50% growth from current levels, according to CBRE research, with hyperscale providers such as AWS and Microsoft are already committing billions to the sector.

The Australian market’s anticipated move into data centre securitisation comes as the broader Asia-Pacific market is also showing growing interest in the sector. Victor Wan, Asia head of capital markets at Linklaters, says data centres are very much at the centre of discourse across the region. 

"Data centres are a hot topic,” he says. “While no deals have been executed yet, if the overall data centre/AI sector continues to expand at its current rate, we expect that data centre securitisation will become an important financing channel.”

Wan anticipates that growth might push towards alternative financing and capacity constraints in traditional bank lending: "The commercial rationale is that the data centre sector is expanding at such a pace that bank financing alone is unlikely to satisfy their financing needs, making alternative channels necessary.” 

However, he warns structural hurdles remain significant in cross-border deals. "The region has a mix of very different systems of law, so including data centres in more than one country can materially complicate the deal structure,” he says. 

Structural and rating challenges

The first Australian data centre securitisation is expected to be structured as an ABS deal. "The master trust structure that usually underpins the ABS model is very flexible, allows lots of substitutions and disposals and offers embedded warehousing features too," Dentons’ McCoach says. She adds that each data centre is different, so there may be specific factors at play which may result in CMBS being favoured over ABS for particular deals. “We have noticed a recent swing to more CMBS deals in the US market in recognition of this.”

Ratings agency approaches present another consideration. S&P Global Ratings has historically capped data centre ratings at A+ due to the unique risk profile of data centres compared to traditional real estate or infrastructures assets, whilst Morningstar DBRS and KBRA have demonstrated willingness to assign triple-A ratings to ABS structures. 

For McCoach, however, the S&P cap "hasn't been a problem in the US" and is unlikely to deter Australian issuance, particularly given strong investor appetite for the sector.

On the other hand, Australian-specific factors including state-based stamp duty regimes may add additional considerations not present in US transactions. Nevertheless, McCoach notes that these considerations should be able to be managed through careful structuring.

The inaugural transaction will likely feature shorter-dated tranches or structural mitigants to address lease rollover risk, given that true 20–30-year leases are “rare in the current market” and data centre leases, particularly with hyperscalers, tend to be shorter, from 10 to 15 years.

McCoach notes it will be interesting to see whether issuers opt for domestic or offshore structures: “Where local structures are favoured, the offshore precedents will need to be adapted for the Australian market. Once the local structures are understood, US investors could show strong appetite for Australian deals, particularly given interest in AUD exposure amid ‘de-dollarisation developments’.”

Marina Torres

ABS

Active October brings heavy supply and strong demand

Despite strong issuance, volatility highlights diverging views on valuations

The European ABS market remained active in October, with substantial primary issuance, strong demand across most sectors and continued resilience in underlying performance, according to monthly fund fact sheets monitored by SCI. Asset managers are reporting healthy placement of both consumer- and mortgage-backed deals, despite spread volatility and a heavy supply backdrop.

However, views diverged on valuations, with some managers highlighting a lack of premium in weaker collateral. Others pointed to broader and continued geopolitical and political uncertainty. 

TwentyFour Asset Management described October as “a notably active month for ABS primary markets, with €20bn of new issuance across Europe”. UK RMBS issuance increased, particularly from specialist lenders, with consistent supply of consumer assets from the continent. Despite “a degree of steepening across the curve,” the asset manager noted that most of this reversed following significant investor demand.

It also observed that “there has been dispersion in collateral performance between lenders and jurisdictions,” adding that the lack of premium demanded by investors has pushed the team to focus on large and established lenders. 

Looking ahead, supply and demand is likely to remain very strong, although TwentyFour remains “cautious on smaller or newer lenders and those that focus on lower-income borrowers”, citing risks tied to weakening economic data and potential noise surrounding the UK Budget.

Similarly, Aegon reported an eventful month, pointing to “volatility in spreads throughout October” as geopolitical headlines, private credit concerns, and increased supply pushed spreads wider. Spreads recovered some of the lost ground towards the end of the month but remain wider compared to the end September. 

Aegon emphasised the broader strength of the market, stating that “European ABS bounced back from October’s volatility, finishing the month in positive territory.” 

The manager adds that fundamental performance of European ABS has been strong overall. However, deterioration is seen in certain parts of the market impacted by the need to refinance at higher rates.

Despite macro uncertainty, Aegon highlighted that “predictable, attractive, and stable income is certainly welcome, which is something that European ABS can provide”. Relatively high carry value of ABS with limited concerns from a fundamental perspective can still make European ABS an attractive asset class for the medium term.

Amundi also pointed to continued momentum in primary markets. It noted: “Primary activity remained strong in line with the previous month, and 2025 continued its momentum toward a record volume since 2007.” 

The manager observed that investor appetite remained steady, particularly for mezzanine tranches driven by very high subscription ratios. Despite this, more secure ABS tranches experienced a slight widening mainly due to the high level of supply, against a backdrop of slightly weaker demand.

Amundi commented on market sentiment, explaining that “some concern was felt on the riskiest parts of the market,” though the consequences for the European market remained negligible. The firm was active across several jurisdictions, stating: “We participated in several transactions: four transactions backed by consumer loans in Italy, Portugal, Austria, and Germany,” as well as mortgage-backed and auto transactions across the eurozone. 

Despite political volatility, particularly in France, Amundi closed the month with a positive return, reporting that “Amundi ABS Responsible posted a positive performance of 0.05% for the month of October 2025.”

Aegon European ABS Fund returned -0.37% in October 2025. YTD: 5.05%
Fund size: €328.632m ABS/MBS allocation: 53.60%

Amundi ABS returned 0.05% in October 2025. YTD: 2.73%
Fund size: €1.102bn ABS/MBS allocation: 97.81%

Janus Henderson ABS Fund returned +0.34% in October 2025. YTD: 4.55%
Fund size: £608.130m. ABS/MBS allocation: 59.21%

TwentyFour AM Monument Fund returned +0.14% in October 2025. YTD: 4.59% Fund size: £2.161bn. ABS/MBS allocation: 58.28%

Matthew Manders

Capital Relief Trades

Double whammy for new SRT issuer

SRT market update

ING closed its two debut SRT trades today, the Dutch lender has confirmed.

These deals mark its initial foray into the market, but it is coming back for more. It plans to extends SRT usage across retail and additional wholesale portfolios, ING says.

Both transactions referenced diversified corporate loan portfolios and had an aggregate notional of €10.5bn.

The transactions offer first-loss protection and should reduce RWAs by €3.4bn, which, in turn, should augment the 3Q 2025 CET1 ratio by 14bp, according to the bank. 

“We are very happy with the successful execution of our first two wholesale bank SRT transactions and are encouraged by the positive response from some very well-established investors around the globe,” ING told SCI, but declined to comment in further depth.

Dina Zelaya

Capital Relief Trades

Busy year-end, steady Q1 in SRT land

SRT market update

The SRT market is entering the last helter-skelter period of execution for 2025 and pricing decisions will be made in the next two weeks or so before things quieten down before the Christmas holiday, investors tell SCI.

Meanwhile, Q1 – traditionally a more subdued period in the SRT market – will see the expected arrival of banks with established SRT programmes.

The surge in Q4 supply has eased the persistent supply-demand imbalance seen for most of 2025, creating a more level playing field and allowing investors to be more selective, add sources. However, business remains dominated by Western European originators, with Greece, for example, contributing a smaller share than in previous years. 

This quarter has also witnessed newer issuers and transactions referencing less conventional asset classes, such as bespoke corporate pool. This is particularly true when placed bilaterally or within small investor groups. 

Corporate and SME portfolios continue to dominate supply, complemented by steady CRE issuance. Investors active across cash and synthetic deal are increasingly targeting auto and consumer portfolios. Leveraged loan exposures continue to rise, with some banks using SRTs to hedge against “potential credit deterioration,” investors warn. 

Finally, market participants suggest pricing remains tight and broadly stable, with spreads not as yet perhaps fully reflecting differences in underlying collateral risks. 

Dina Zelaya

Capital Relief Trades

Austrian bank returns to SRTs after decade absence

UniCredit and PGGM seal long-term SRT partnership

UniCredit Bank Austria has re-entered the SRT market after a 10-year hiatus, SCI has learned, with a €1.945bn SRT referencing a portfolio of corporate and SME loans in a deal executed with Dutch investor PGGM. 

The transaction, dubbed Project ARTS Belvedere 2025, priced last month. About 80% of the loans are to Austrian borrowers, alongside a small portion of EU obligors.

The capital structure includes a 50bp first loss tranche retained by UniCredit, a €10m junior tranche also held by the bank, and a €116m mezzanine tranche provided by PGGM, attaching above the junior piece and detaching at 6.5%.

UniCredit retains the senior risk, while PGGM provides protection solely on the second-loss tranche. UniCredit Bank acted as sole arranger and placement agent.

The deal does not qualify as STS.

Unicredit PGGM talk process

In an exclusive interview with SCI, Stefano Chiarlone, head of balance sheet management at UniCredit, Andrea Modolo, head of the advisory team at UniCredit, and Luca Paonessa, lead portfolio manager, credit risk sharing at PGGM, shared details about this landmark trade:

“From our perspective, whenever we build a relationship with a bank within the UniCredit Group, we really see the whole group as one single partnership. One important benefit of adding local subsidiaries to our portfolio is that in this way we get exposure to assets that have a low correlation with other assets is in the pension fund balance sheet,” comments Paonessa. 

“This is very much the case for the Czech Republic, Bulgaria and now Austria. We can really leverage everything we learned from our first due diligence on all the others, because UniCredit is a group with a very strong ability to standardise processes and expertise across entities. As of today, UniCredit has become one of the core relationships of our mandate,” he adds. 

The deal expands the bank’s capital management efforts into Austria for the first time, and also underscores UniCredit Group’s position as one of Europe’s most active SRT issuers. 

It ARTS programme is a multi-jurisdiction SRT strategy designed to improve capital efficiency across the entire group. 

Project ARTS Belvedere 2025 is the third collaboration between UniCredit and PGGM, following the completion of ARTS Silver-2 in Bulgaria earlier this year and ARTS Morava in the Czech Republic in 2024. 

“If you sum up the volume we have generated across these three transactions – each one by itself not very big for our standards – you come up with a very meaningful exposure, similar to the one we have with large international banking goups,” Paonessa explains. 

“And more than anything, we are very happy that UniCredit believed in this approach. We completed three transactions in exactly one year – the first one closed on 27 November last year. I think it’s a record; we’ve never had three transactions in one year with the same partner bank,” he continues. 

In recent years, UniCredit has relied heavily on SRTs to optimise risk-weighted assets (RWAs) across Italy, Germany and CEE markets. 

“For us, the key point is that we hadn’t executed an SRT transaction in Austria for 10 years, so this really is a return. Among our banks in Italy, Germany and Austria, Austria was the missing piece. Completing this deal now means we can finally say we operate SRT across all our core jurisdictions – which is why it was so important to us,” says Chiarlone. 

Competition and investor appetite for the deal also proved very high, with Chiarlone stressing the issuer’s flexible approach to investor selection.

“We run a competitive bid and then depending on the situation, after the non-binding or binding offer, we might decide to switch to a bilateral process if the offer is particularly compelling. When that happens at the non-binding phase, before going bilateral, we hold discussions with the bidder to make sure there is no misunderstanding with respect to the bid or the commercial expectations. In this case, we had those discussions, were convinced we could move forward with PGGM, and decided to progress in that direction,” he adds. 

The deal marks UniCredit’s sixth SRT transaction in the CEE region, highlighting the group’s broad geographic reach and focus on capital efficient growth. 

PGGM says they remain open to collaborating with the bank across asset classes. 

“Our methodology, which is not based on underwriting names but on underwriting the quality of the bank, is very well suited for this type of transaction,” says Paonessa. 

“We expect to continue discussing opportunities with Unicredit. We know them very well, and we can easily move from one type of portfolio to another – from corporates to project finance, from project finance to CVA exposures,” he adds.

The road ahead 

Next year is looking promising, with plans for further issuance taking shape.

“We have a plan that we are finalising for 2026 that will cover Italy, Germany, Austria and CEE countries. We are still analysing it and will fine-tune the SRT once that is complete, but we will certainly have transactions in CEE and Central Europe. PGGM will be among the partners we invite, and we are more than happy to work with them again,” Chiarlone notes. 

Paonessa believes 2026 will be particularly interesting for the SRT market, with more banks beginning to issue – a trend manifested by the constant stream of new transaction announcements. 

Once a bank starts issuing, he adds, it typically remains active, creating a permanent expansion in market volume. At the same time, investor appetite for large corporate portfolios has been so strong lately that questions remain about whether excess value is still available - making this segment one to watch next year.  

PGGM is one of the most well-established investors in the market, and this longevity and commitment to the sector is of particular value to Unicredit.

“An important thing is the trust we have with the PGGM team – this really matters. You see so many investors active in SRT, but only a few have always been there, and PGGM is one of them. We call them seasoned investors,” comments Andrea Modolo. 

“Today is a sunny day for SRT, but at some point, the weather may turn. I’m curious to see how many investors will stay when it gets cloudy.”

Nadezhda Bratanova 

Capital Relief Trades

Sprint to the finish line

SRT market update

After this weekend, the SRT market will enter the last frenetic fortnight of pricing and execution before year-end, and news and rumours of deals continue to dominate.

By week beginning December 15, the pace will slacken, say market participants and the traditionally more sedate pace of Q1 will open 2026.

One of the biggest news items of the week was the confirmation from UniCredit Bank Austria that it has returned to the market after a 10-year absence with a €1.945bn new SRT referencing corporate loans, completed with veteran risk sharing investor PGGM.

In an exclusive interview with SCI, the issuer gave details of its plans for 2026, and confirmed it will be coming back to the market for more, especially in CEE and central Europe.

Almost as eye-catching was the confirmation by major Dutch lender ING closed two debut SRT deals, and its also confirmed that it won’t be a stranger to the market in 2026.

The transactions referenced diversified loan portfolios for an aggregate notional of €10.5bn, and they earned the US$1.3trn bank an RWA reduction of €3.4bn.

Rumours of new deals continue to swirl around the market. Two trades referencing RMBS assets, one from a UK lender and one from a Spanish lender, are in the market and are close to pricing.

A big plus of the traditional end-of-year splurge is the easing of persistent supply-demand imbalance, seen for most of 2025, allowing investors to be more selective, say sources.

The global regulatory picture may also be about to getting a lot rosier for securitization markets in general and SRTs specifically. The EU is considering a whole host of measures, the bulk of which, if enacted, will make it easier to be a buyer of SRT and an issuer.

Meanwhile, across the Atlantic, the expected watering down, if not total abandonment of B3E, is thought to herald a friendlier attitude from regulators towards structured finance. The SRT market has a friend in high places in the shape of Federal Reserve governor Michelle Bowman and experts say the current approval process for bank CLNs could be streamlined.

Simon Boughey

Asset-Backed Finance

Ex-BZ duo eye ABF fund launch

Eden Rock Credit seeking family offices for European-focused strategy

Former BZ duo Robert Wakeford and Kevin Yates have teamed up to launch a new asset-backed finance fund, SCI has learned. The pair have launched Eden Rock Credit in London and will begin fundraising for a €500m vehicle in 1Q26.

The firm is set to target mid-market asset-backed and corporate lending and is in the process of securing an anchor investor, which should be finalised in the coming months, sources told SCI.

Joining the duo as a co-founder is former Interpath debt advisory pro Chris Hall. Hall joins the shop after three years with Interpath, where he was an md.

Although sector-agnostic, the firm focuses on “out of favour” sectors, such as industrials, and will be European-focused, with a bias towards the UK.

Eden Rock expects to build its investor base primarily from private wealth capital, including family offices and high net-worth individuals.

Before launching, Wakeford spent five years with structured asset-based lending solutions specialist BZ, where he was an md. He also worked for a decade with Leumi ABL, the European subsidiary of Leumi Group.

Yates had a similar career path, spending five years at BZ, where he worked on the senior management team responsible for risk, compliance and operations. He also spent 11 years with Leumi ABL.

Eden Rock Credit declined to comment.

Jacob Chilvers

Asset-Backed Finance

ABF Deal Digest: LendingClub expands into home improvement financing

A weekly roundup of private asset-backed financing activity

This week’s roundup of private ABF activity sees LendingClub Corporation partner with Wisetack to enter the US$500bn home improvement financing market. Elsewhere, Cornerstone Financing has inked a strategic asset purchase commitment with Fortress, while Klarna is set to sell up to U$6.5bn worth of its US Fair Financing loans.

LendingClub’s partnership with Wisetack is expected to jumpstart LendingClub's entry into the home improvement financing market by leveraging Wisetack's network of approximately 40,000 contractor merchants and dozens of embedded SaaS partnerships in the home improvement space, providing both the underlying technology and distribution network to grow rapidly. Leveraging Wisetack's innovative platform, LendingClub will offer consumers real-time approvals, transparent terms and affordable payments – all designed to make home upgrades more accessible and predictable – delivered through a borrower's device. Contractors and installers will benefit from higher close-rates, fewer cancellations and reliable API-based payouts that streamline the financing experience.

The partnership will scale in two phases. Initially, LendingClub intends to begin purchasing participation certificates in early 2026 from Wisetack's existing forward flow loan production. In mid-2026, LendingClub expects to begin using its own underwriting model to originate larger-sized home improvement financing loans not currently available on Wisetack's platform.

LendingClub's market entry is also supported by the acquisition of core lending technology and select talent from Mosaic, a former fintech lender with a high-performing platform built for contractor-based lending. The combination of strong consumer demand, broad merchant adoption, leading underwriting and efficient delivery and servicing gives LendingClub a clear path towards sustained growth in 2026 and beyond.

Aussie SME solution launched
ScotPac has launched a new ABF solution for Australian and New Zealand SMEs. The product introduces a single revolving working-capital facility secured against a broad pool of assets – including debtors, inventory property, plant and equipment – and is aimed at growing businesses which have simultaneously outgrown small-ticket lending and are constrained by bank covenants. The launch marks a notable expansion of ABF capabilities in the continent and by offering faster and more streamlined onboarding, ScotPac hopes to support future warehouse and structured funding partnerships as the platform builds.

Capital on Tap inks ABF facility
Capital on Tap has secured a £500m ABF facility to support the expansion of its SME credit card and working capital platform. The facility - reportedly backed by existing institutional partners - provides additional capital to scale originations across the UK and US, following strong demand from small business borrowers. Capital on Tap anticipates the new structure will bolster its ability to serve SMEs at a time when demand for credit among small business remains high.

CHEIFS bolstered by Fortress commitment
Cornerstone Financing has announced a strategic asset purchase commitment of up to US$1bn from funds managed by affiliates of Fortress Investment Group. The forward flow agreement accelerates Cornerstone’s mission to help mass-affluent homeowners efficiently convert dormant home equity into liquidity without interest, debt or monthly payments through its flagship product, CHEIFS (Cornerstone Home Equity Insurance/Investment Funding Solutions). The agreement with Fortress represents one of the largest institutional commitments in the home equity investments (HEI) sector and signals a significant shift in how prime home equity can be used as a financial asset.

Klarna signs Fair Financing agreement
Klarna, the Swedish BNPL fintech, is set to sell up to U$6.5bn worth of its US Fair Financing loans to investments funds managed by Elliott Investment Management over a two-year period. The forward flow agreement will allow Klarna to access scalable, off-balance sheet funding to support its growing US consumer credit business.

Claudia Lewis, Corinne Smith, Marina Torres

Asset-Backed Finance

NLC targets up to US$3bn for new NAV lending fund

Ex-Macquarie pros Steve Berry and Roger Fox will manage the strategy

NLC Capital Partners is eyeing up to US$3bn for a new credit NAV lending fund, SCI has learned.

The new product, which is set to launch next year, will target asset-backed lending to private credit and private equity funds, sources told SCI.

The vehicle will provide financing for primary and secondary credit portfolios through the fund lifecycle.

Loans will be investment-grade, between three and five years, with typically single-A risk.

NLC is planning a 12- to 18-month fundraise. The launch is set to be the cornerstone of its new asset-backed lending business line.

The strategy will be managed by former Macquarie fund finance specialists Steve Berry and Roger Fox, who joined NLC in July after eight and four years of service, respectively.

Berry holds the title of md and head of credit NAV; meanwhile, Fox holds the title of investment director.

For its investor base, the firm is seeking a diverse mix of LPs, including pension funds, family offices and insurance companies across the US, UK and Europe.

London-based NLC Capital Partners was founded in 2021 by Investec pros Slade Spalding and Neno Raic. Since its inception, the firm has funded over US$6.5bn in loans.

In recent months, the firm expanded into the US, opening its first office in New York. Spalding has since transferred there to focus on US origination.

The firm also manages an evergreen subscription line financing fund, which makes short-dated loans to private credit and private equity funds.

NLC Fund Financing IG Short Dated is an open-ended Luxembourg-domiciled vehicle which has raised around US$750m.

NLC declined to comment.

Jacob Chilvers

Regulation

Regulators turn nice

Global reforms to boost issuance

Securitisation volumes will blossom in 2026 should a constellation of global regulatory initiatives come to fruition, according to Fitch.

Regulators in the EU, US, UK and APAC are all considering measures which would make holding securitised paper less burdensome for banks and insurers.

“The mood music is turning positive regarding securitisation origination and investment which should lift overall sentiment in the market and boost issuance volumes,” Monsur Hussain, head of markets research, tells SCI.

The SRT market is expected to be a particular beneficiary if the EU carries through a series of broad and potentially far-reaching proposals made earlier this year. The EU is by some way the biggest SRT market so any successful reforms in this jurisdiction would augment overall issuance appreciably.

The envisaged reforms would make life easier for issuers by moving away from often onerous mechanistic tests to demonstrate risk transfer to a more principle-based approach and would also make life easier for buyers by reducing capital requirements.

Insurers would also find it easier to provide unfunded SRT protection, particularly of mezzanine tranches, by lessening capital charges. EU insurers hold only an estimated 0.5% of their aggregate investments in securitised assets, compared to US insurers who held 12% of aggregate investments in ABS.

“European insurers are underweight versus US peers, so the hope is that they would provide a capital efficient entry point for insurers to SRTs,” says Hussain.

However, it is not certain that these proposals will go through as envisaged. Critical discussions in the EU are going on at the moment, but it will not be until next year that clarity dawns. There is some confidence that the bank-related reforms will go ahead, but those affecting insurers are more uncertain, says Hussain.

Meanwhile, in the US, the envisaged pullback from Basel III Endgame - which was universally reviled by banks - heralds a more relaxed attitude to the SRT market and deregulation in general. For example, the process by which banks must seek individual and specific approval from the Fed for each CLN transaction could be streamlined.

More broadly, the requirement for issuers to retain subordinated tranches to capture capital relief – which is not the case EU originators – has been a vexed issue in the US for some time and this could be due amelioration as well. Risk weightings that are used in the calculation of SRT asset pools are also thought to be up for discussion.

Australia is a large and important market for securitization, but not yet for SRTs as the Australian Prudential Regulatory Authority (APRA) has yet to give its blessing to the mechanism. However, there is some optimism that it will relax its scepticism. It is currently conducting a broad fact-finding exercise canvassing views from all sides of the market about the prudence or otherwise of risk-sharing deals.

“Our expectation is that this will result in a harmonized view of the risk factors and benefits of SRTs which will probably lead to some recalibration of views,” says Hussain.

Finally, the UK is exercising its post-Brexit freedom to offer a more flexible approach than its European neighbours to risk weightings by requiring a ratings-based approach rather than standardized or IRB models. The Prudential Regulatory Authority (PRA) says that credit rating agencies have access to more extensive data and can consider a wider range of characteristics than is possible with the standardised methodology, and this less prescriptive approach may also augur greater issuance in structured finance.

Critics maintain the proposed EU reforms are not ambitious enough, and there is doubt that the ones on the table will be carried through. Nonetheless, the tea leaves suggest a more conducive market for securitisation and especially SRT in the next year or two, which should be reflected in potentially significantly enhanced volumes.

Simon Boughey

Structured Finance

Job swaps weekly: IQ-EQ acquires Zenith

People moves and key promotions in securitisation

This week’s roundup of securitisation job swaps sees IQ-EQ acquiring Zenith Global, marking its entrance into the Italian market. Elsewhere, a former Fried Frank partner has joined Gibson Dunn as a partner and head of fund finance, while two former Macquarie fund finance specialists are to lead NLC Capital Partners’ new asset-backed lending strategy.

IQ-EQ is to enter the Italian market with its planned acquisition of Zenith Global. The takeover of the Italian structured finance service provider gives IQ-EQ its first operations in Italy, adding more than 200 professionals across Milan and Rome, bolstering its global capital markets proposition. 

The deal remains subject to regulatory approval by the Bank of Italy and Italy’s FDI review board, with completion expected in Q1 2026. Zenith ceo Umberto Rasori is expected to continue leading the Italian business and will join IQ-EQ’s continental European senior leadership team to ensure continuity.

Meanwhile, Duncan KR McKay has joined Gibson Dunn as a partner and head of fund finance in the firm’s New York office. McKay brings extensive experience in structuring, negotiating and managing complex fund finance and structured capital transactions, including asset-based, rated note feeder and CFO transactions.

McKay joins Gibson Dunn from Fried Frank, where he most recently served as a partner, having previously built his practice at Kirkland & Ellis. He will work alongside Gibson Dunn's investment funds, capital markets, and other practice groups to serve leading asset managers and fund sponsors worldwide.

Former Macquarie fund finance specialists Steve Berry and Roger Fox, who joined NLC Capital Partners earlier this year, will be responsible for managing the firm’s soon-to-be-launched asset-backed lending business line, as SCI reported this week. Berry, who holds the title of md and head of credit NAV, and Fox, who is investment director, joined NLC in July after eight and four years at Macquarie respectively. In recent months, NLC expanded into the US, opening its first office in New York.

In other news reported this week by SCI, former BZ duo Robert Wakeford and Kevin Yates have teamed up to launch new asset-backed finance fund, Eden Rock Credit, which is due to begin fundraising next year and will target mid-market asset-backed and corporate lending. Joining the duo as co-founder is former Interpath debt advisory pro Chris Hall, who joins after three years with Interpath, where he was an md. 

Paul Hastings has appointed Jennifer Passagne as a partner in its its fund finance team in London. Passagne joins from Haynes Boone, bringing experience advising private equity and venture capital funds on fund finance structures – including NAV facilities, capital-call and hybrid facilities – as well as lender-side expertise in leveraged and acquisition finance. Her hire forms part of a broader effort to rebuild and expand Paul Hastings’ London office’s capacity in fund finance and structured credit amid growing market demand.

And finally, Equirus Group has appointed Manishkumar Jain as ceo of its newly launched Equiris Finance. Jain holds more than 20 years of experience in capital market lending, treasury management and structured credit across firms including ASK Group, Nuvama, Anand Rathi Global Finance and Deloitte. In his new role, he will lead efforts to build a diversified lending franchise targeting high-net-worth individuals, family offices and promoters. Equirus Finance intends to become an integrated wealth and credit platform in India and offer bespoke solutions such as loans against securities, ESPO financing, structured credit and market-linked debentures.

Claudia Lewis, Jacob Chilvers, Marina Torres, Corinne Smith