Funding Circle gets backing from British Business Bank- Funding Circle SME Income Fund Limited (FCIF) has announced today that they have backing from the British Business Bank. British Business Bank will provide £150 million of funding via a senior, floating rate, loan. The loan will be used by Funding Circle to fund loans with small to medium sized businesses and they will participate in these transactions via junior investments. If Funding Circle believes market conditions are right, they may consider refinancing the loan via public ABS markets to enhance their return. Funding Circle intends to have the funding be drawn down to replace their current loans as these are scheduled to amortise over the next couple of years. They want to make sure they stick with their policy of operating with leverage limited at 50% of NAV.
Richard Boleat, chairman of Funding Circle SME Income Fund, commented about the recent transaction saying: “The Board welcomes this opportunity to work alongside the BBB to help achieve one of its key goals of increasing lending to the real economy by utilising an efficient transmission mechanism for stimulating lending to SME borrowers, whilst securing ongoing access to financing for shareholders.”
FCIF- Funding Circle gets backing from British Business Bank