Articles

The coronavirus-triggered downturn is pushing default rates higher and is also affecting the bankruptcy procedures used to address such credit defaults, according to Fitch Ratings. Several recent debtors have had their bankruptcy cases derailed as ability to access exit financing markets has been compromised. Similarly, decreased lender appetite for equitized debt as well as lack of third party interest in certain distressed assets has also disrupted the streamlined trend of pre-coronavirus Chapter 11s. Lender fears with respect to DIP facilities as well as an increased frequency of liquidation outcomes will likely further impede the goal of preserving value in U.S. bankruptcies during the crisis. Given that recoveries are tied to distributable value, a prolonged pandemic may contribute to lower creditor recoveries for debtors with disrupted processes.

SFNet's Asset-Based Capital Conference offers you the opportunity to join your colleagues in asset-based lending, alternative asset management, private debt, private equity, distressed debt, and service providers such as attorneys and appraisers for panels and discussions on the rapidly changing economic environment and how it impacts your portfolios and business opportunities.

On March 9-11, we will bring ABCC to you live online, with the great content and opportunities for networking that you have come to expect from the conference. We caught up with ABCC Conference Chair, Barry Bobrow, managing director and head of Loan Sales & Syndications for Wells Fargo Capital Finance who discusses what will make this year’s Conference stand out. 

CIT Group Inc. (NYSE: CIT) today announced that David Harnisch will join the company as president of Commercial Finance, effective Sept. 23, 2019. Harnisch will succeed the current president of Commercial Finance Jim Hudak who has elected to retire following a 20-year career at CIT, effective Sept. 3, 2019.

The Post-COVID New Normal For Store Closing and Strategic Sale Events. Reflections by SB360’s Scott Bernstein.

“Why aren’t you in the water?  Nobody’s going in.  Please… get in the water.”  Those pleading words uttered in the 1975 blockbuster movie “Jaws” were part of an ill-fated effort by Mayor Larry Vaughn to save his fictional sleepy beach town from financial ruin.  Those of us who saw the movie or have binged watched Shark Week re-runs know how that worked out for the reluctant residents of Amity.

In this installment of our series of executive interviews, Charlie Perer sits with Tim Stute to understand his views on the ABL industry, consolidation, new trends including specialization and state of the M&A market, among other things.

A designer of high-end handbags and accessories lost coverage on some of their retail customer accounts due to COVID-related challenges. When their existing bank was unable to cover those customers and restricted their borrowing capacity, the client reached out to Rosenthal.

When one of the world’s largest manufacturers of premium textiles and bedding was looking to establish a U.S. entity to sell to retailers, the company sought out a factor to provide the necessary credit coverage it needed to move forward. Unfamiliar with factoring and given the current state of the retail environment, the company turned to Rosenthal because of the firm’s deep experience in the textile and retail space.

I hope you had a safe and peaceful weekend as many of us celebrated the Passover and Easter holidays and found some respite from the crisis in our friends, families and communities.  Events continue to unfold at a rapid pace, and I’d like to bring you up to speed on what our association is doing to analyze and share information and influence outcomes to support our collective interests.  Our priority remains to attend to the well-being of our SFNet community and to fulfill our mission of putting capital to work. 

On the legislative and regulatory front, we have focused our Advocacy resources on three imperatives.

• Leveraging the CARES Act. Last week an additional $250B was pledged to the already oversubscribed Paycheck Protection Program. SFNet and our volunteers, in alignment with the AFA, ELFA, ASEA and other trade associations, are petitioning legislators to simplify execution challenges, modify affiliation rules and extend eligibility to financial services companies under PPP. Our positions on these matters can be found at SFNet.com. 

Is there a British coup occurring? Well, not really. As one demonstrator from the Shires pointed out on prime time TV, “I don’t see any tanks.”  Of course there are no tanks; this is England and in times of crisis we are more likely to be found handing out tea and sympathy than storming the Bastille.

What has happened though, is that we have all learned some new phrases and words and even the historic context of them:

Travelers Financial Group today announced the launch of Travelers Restructuring Capital ("TRC"), a transitional capital initiative designed to support small and mid-market businesses that operate in asset-intensive industries.

Q3 2019 results generally demonstrate the continuation of trends observed throughout 2019.  Year to date, we continue to have growth in the industry as a whole and credit quality remains solid.  There are a few notable deviations from trends observed throughout the year as we will see.

General economic conditions continue to be top of mind for the secured finance community, but it is interesting to note that we continue to see a divergence between Bank and Non-Bank Lenders with respect to the SFNet Confidence Index. As a reminder, starting in 2019, we have chosen to divide the ABL lender universe along Bank and Non-Bank lines, as opposed to our previous methodology of splitting up the ABL lender universe by portfolio size.

NGL Energy Partners LP announced that it has entered into a new $250 million term loan facility with certain funds and accounts managed by affiliates of Apollo Global Management, Inc. to refinance its existing $250 million bridge term loan facility that was established in July 2019 with TD Securities (USA) LLC as lead arranger and bookrunner and The Toronto-Dominion Bank, New York Branch as initial lender to finance a portion of the acquisition of Mesquite Disposals Unlimited LLC.

California Bank of Commerce (CBC) announces the launch of its Sponsor Finance Lending Division, led by well-known dealmaker Larry LaCroix. The division works closely with private equity firms (including Search Funds) and direct lenders to provide cash flow-based senior debt financing.

Revolution Capital, the leading provider of factoring & cashflow financing in Canada and the United States, has acquired Grand Financial New York., a factoring company specializing in staffing and transportation.

The move expands Revolution Capital’s reach in the US market, solidifies its presence on the East Coast, and allows clients of Grand Financial New York to access faster funding, personalized service, and transparent online reporting.  

Libby Gill is a leadership speaker, executive coach and author. She is also is the CEO of Libby Gill & Company, an executive coaching and leadership consulting firm, guiding clients and their teams through change, challenge and chaos. Previously, Gill was senior vice president at Universal Studios Television, and vice president at Sony Pictures Television and Turner Broadcasting.

Libby is the author of five books, including the award-winning “You Unstuck, Capture the Mindshare and the Market Share Will Follow, and Traveling Hopefully. Her latest book is “The Hope-Driven Leader: Harness the Power of Positivity at Work.” She is a former columnist for The Dallas Morning News.

Great Rock Capital, an asset-focused commercial finance company specializing in middle market lending, announced the close of a $100 million leverage facility with KeyBank National Association, one of the nation’s largest bank-based financial services companies headquartered in Cleveland, Ohio.

The new facility will provide Great Rock Capital with further flexibility to offer creative financial solutions that maximize liquidity to middle market borrowers and will position the firm for continued growth.