Firenze for Wealth Managers

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What is a Lombard loan?

Lombard lending allows your clients to borrow against their existing cash and investments portfolio. Rather than having to sell their investments and miss out on potential returns, they can access liquidity quickly and without incurring potential tax charges.

How does a Lombard loan work?

A Lombard loan typically involves:

A Lombard loan works by requiring the borrower to pledge liquid assets, such as equities, bonds, funds or commodities.
With a Lombard loan, you can borrow against your assets, typically up to a certain percentage of their market value. The specific percentage is determined based on various criteria, and is known as the Loan-To-Value ratio.
Lombard lending requires ongoing monitoring, as naturally the value of the collateral will change daily in line with markets.
If the portfolio value falls, this may result in what is known as a margin call, which is a demand to top up the value of the portfolio if it falls below a required amount, essentially, the amount sufficient to cover the shortfall.
In the instance of significant market downturns, Firenze has the right to sell the investment portfolio.

How can you obtain a Lombard loan for your clients?

Approach Firenze to validate the value of your client’s portfolio
Client completes an appropriateness test, enters basic info, and completes a digital KYC check
Client e-signs documents
Client pays Firenze the arrangement fee and can drawdown on their facility which is managed by you as their adviser

Reach out to our team below for more information.

Is a Lombard loan right for my clients?

Lombard loans are extremely attractive due to the flexibility of the terms. Advisers can initiate, monitor and manage loans directly in accordance with your clients’ needs. Clients repay when needed and only pay interest on drawn funds. However, Lombard loans are intrinsically linked to market performance and require your clients to demonstrate their understanding of the associated risks.

Ideal for:

High-net-worth individuals (income >£150k or net assets >£500k) within the UK (excluding Jersey, Guernsey, and the Isle of Man).
Family Investment Companies and Hold Co’s.
Borrowers seeking liquidity for property, gifting, or business needs.
Investors who want to avoid selling assets in a downturn.
Borrowers looking for funding from £65,000 - £5,000,000.

Not for:

What does Firenze lend against?

Cash

Government bonds with a rating of BBB- or above
Corporate bonds with a rating of BBB- or above
Equities listed on a Main Market or Recognised Investment Exchange (subject to min market cap of $1bn)
Gold
Funds (inclusive of ETFs) investing in any of the above (subject to being priced daily and min fund size of $250m)