Asset-Based Lending Becomes Key to Finance Director's Toolkit; Mark Harris, Head of Corporate at HSBC in the Midlands, on the Growth of Asset Based Lending

The Birmingham Post (England), August 23, 2012 | Go to article overview

Asset-Based Lending Becomes Key to Finance Director's Toolkit; Mark Harris, Head of Corporate at HSBC in the Midlands, on the Growth of Asset Based Lending


Byline: Mark Harris

Asset based finance is increasingly forming part of the discussions that we regularly have with our clients, advisers and the professional services community.

Finance directors view it as an important part of their funding toolkit and asset based finance is a common component of everyday working capital solutions.

It is a flexible and cost-efficient method of funding corporate activity, be it expansion into new markets, funding an acquisition or investing in equipment or staff.

Obviously, the traditional sources of funding still remain, including bank loan, overdraft, venture capital and private equity, but there has been a clear trend in recent times towards asset based finance to complement these sources and businesses are far more open to discussing these forms of funding than ever before.

This year, in the Midlands we are on track to at least double the volume of asset based finance business we complete compared to 2011. Whilst there has been a significant upturn in companies leveraging their debtor book to generate finance, larger companies are also increasingly looking to use inventory, plant & machinery and unencumbered real estate as a way to fund their business.

The benefits of asset based finance, particularly invoice finance, to a business are well documented. It enables companies to use their assets to access greater levels of funding than might otherwise be possible and supports high growth ambitions and intensive working capital requirements. It provides companies with flexibility because the level of borrowing matches the business's sales, so as sales increase, the amount of funding increases in line with them.

Importantly for the business, the cost of finance for an Invoice Finance deal is generally about the same as for overdraft, but can be more flexible as it keeps pace with sales.

For the lender, it is attractive on both a risk and capital ratio level and often enables the lender to release greater levels of finance than they would under a traditional loan structure.

Most typically we are seeing assetbased finance used by businesses in the Midlands for growth purposes with companies using their debtor books or other assets to accelerate business expansion.

There are plenty of strong and growing businesses in the region, particularly those that are targeting international growth, and structuring an effective funding package to enable them to take advantage of overseas opportunities is crucial. …

The rest of this article is only available to active members of Questia

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

Asset-Based Lending Becomes Key to Finance Director's Toolkit; Mark Harris, Head of Corporate at HSBC in the Midlands, on the Growth of Asset Based Lending
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Help
Full screen

matching results for page

    Questia reader help

    How to highlight and cite specific passages

    1. Click or tap the first word you want to select.
    2. Click or tap the last word you want to select, and you’ll see everything in between get selected.
    3. You’ll then get a menu of options like creating a highlight or a citation from that passage of text.

    OK, got it!

    Cited passage

    Style
    Citations are available only to our active members.
    Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

    1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

    Cited passage

    Thanks for trying Questia!

    Please continue trying out our research tools, but please note, full functionality is available only to our active members.

    Your work will be lost once you leave this Web page.

    Buy instant access to save your work.

    Already a member? Log in now.

    Author Advanced search

    Oops!

    An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.