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    MARTIN COOPER, Director & Head of Large & Major Corporates, Lloyds Bank Commercial Finance

     

    "In today's tough conditions, we're seeing more and more companies using Asset Based Lending (ABL) strategically to boost growth and gain competitive advantage," says Martin Cooper.


    “Frankly, I’m always surprised even more businesses aren’t knocking down our door to use this. It’s such a logical, sensible, secure evergreen facility.”

     
    The growth in ABL’s popularity has been remarkably consistent over 20 years, says Martin, Director & Head of Large & Major Corporates, Lloyds Bank Commercial Finance. “Barring 2008-09, demand has grown at around 7-8% every year.”

     

    Its strength is its versatility, he explains. “Strong managers are now more sharply focused than ever on the right facilities to capitalise on opportunities that come their way. For them, ABL is an excellent tool for making acquisitions, funding expansion and financing management buyouts.

     

    “At its simplest, it’s monitored debenture lending based on a basket of assets – primarily receivables, but also inventory, plant, machinery and property – to meet clients’ working capital requirements.


    “And, because it’s more closely monitored, we can leverage a higher amount of facilities against those assets. As your business grows, so does the facility. You haven’t got to keep applying for new limits. The whole facility just grows in line with the business.”

     

    It’s also a growth driver. “We find companies using ABL lift their turnover faster than others.” It aids exports too. “As soon as the lorries deliver your products across Europe and you’ve raised your invoice, you’re getting 80-85% of the cash up front.”

     

    It’s also straightforward. “One of our audit executives will spend a day or two on-site to gain a really intimate understanding of your business strategy and ambitions. Our fresh pair of eyes can often see new opportunities for process efficiencies, for instance, ways to minimise inventory or maximise realisation of receivables.”

     

    Finally, it’s scaleable. “We can raise up to £750m-worth of facilities and syndicate that out among a group of experienced asset-based lenders. Increasingly, we’re seeing mid-market clients coming to us as a strategic choice. Its beauty is its sophistication in complementing our customers’ strategic planning.”

9/17/2019 3:56:52 PM