Asset-backed lending in turbulent times

While the pandemic has caused major disruption to our everyday lives, the direct and indirect effects of government intervention, monetary policy, the war in Ukraine and Brexit are also taking shape. With global supply chains impacted, soaring inflation and product shortages, the current environment is clearly challenging. However, with dislocation comes opportunity.

Many investors and managers have historically focused on corporate private credit, directly lending to companies based on their cash flows. RoundShield’s senior investment team, on the other hand, has specialised in providing loans secured by assets for the last 20 years. While focused on generating strong risk-adjusted returns, RoundShield first and foremost seeks to protect investor capital. The focus is on managing downside risk by considering liquidation values of underlying assets (infrastructure, real estate and other hard or financial assets) vs. EV or EBITDA in our underwriting. RoundShield also places significant emphasis on investing in markets and through structures which enable efficient enforcement if necessary. Many assets also benefit from long term contractual cash flow streams, mitigating risk in more volatile periods.

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