Credit Enhancement
Credit Enhancement Insurance assists Bank and Non-Bank finance providers in mitigating or transferring their credit risk by covering financial loss under loan agreements or managed capital allocation.
It offers proven and profit-enhancing alternatives to traditional cash syndication and sub-participation, underpinned by favourable regulatory implications.
Assetinsure has participated in risk facilities totalling US$6.0 billion globally, accommodating over 35 industries across a vast array of facility types.
With credit enhancement, Lenders could benefit from increased regulatory and capital flexibility, and have access to higher collateral leverage, a longer loan term, lower amortisation profiles and/or improved risk pricing.
Credit enhancement insurance policies are issued by HDI Global Specialty SE Australia, a wholly owned subsidiary of AA- S&P rated HDI Global Specialty SE.
We are a team of highly qualified banking professionals each with over 25 years’ experience in wholesale banking, commercial lending and loan syndication.
To discuss your Credit Enhancement insurance requirements, please call Brian Satterthwaite on +61 2 9251 8055.
Credit Enhancement FAQs
Credit Enhancement Insurance Policies (CEIPs) - how can they help?
- When borrower exposure limits are reached
- When collateral type and asset class credit approval restrictions exist
- When risk sharing is required outside of traditional bank sell down routes
How are CEIPs structured?
CEIP coverage can be structured on the basis of either;
- First loss protection; or
- Proportional (i.e. pari passu) participation.
What can a CEIP provide?
- Tangible liquid security (HDI Global Specialty A+ S&P rated);
- Cost effective risk management to the benefit of lenders and their borrowers;
- No loss of control where a First Loss position is taken (full subordination to the Lender).
What types of customers do CEIPS support?
- Single large commercial real estate investments, structured corporate finance, leveraged finance, commercial equipment lease finance or asset backed loan facilities;
- Infrastructure or project finance type facilities where risk sharing is required;
- Defined risk positions in corporate trade accounts receivable warehouse loan and securitisation funding structures;
- Defined risk positions in other pooled commercial mortgage or equipment loan / lease warehouse and securitisation funding structures.
What is the benefit of a CEIP?
Specific benefits provided to the parties are:
- Managed Risk – Borrower achieves an attractive “term”
- Credit Relief
- Cost effective
- Client retention
- Undisclosed – bilateral transaction direct with the Bank
- Flexible
- Recovery Enhancement