In 2024, lower middle market lending reflected a balance between caution and innovation as economic conditions evolved. Lenders adjusted to rising interest rates by tightening credit terms and implementing stricter covenants, emphasizing risk mitigation. Unitranche loans and mezzanine financing gained traction, offering flexible options for borrowers seeking growth capital. Non-bank lenders continued to expand their presence, filling gaps left by traditional banks with tailored lending solutions. Healthcare, niche manufacturing and technology sectors attracted the most interest due to their stable cash flows and growth potential. ESG-focused lending emerged as a growing trend, aligning financing options with sustainability goals. Despite macroeconomic pressures, LMM lending remained resilient, adapting to market shifts and supporting business expansion through creative financial strategies.
Deal Spotlight: TAB Bank
- Category: Lower Middle Market
- Lender: TAB Bank
- Deal Size: $10MM
- Borrower: Mobility Trust
- Industry: Mission Driven Financial Services
TAB Bank Extends $10MM ABL Loan to Mobility Trust, Supporting Accessibility and Social Impact
TAB Bank created a groundbreaking partnership with Mobility Trust, approving a $10 million asset-based loan to expand access to adaptive technologies for individuals with disabilities. The deal marks a significant milestone in socially responsible financing, aligning TAB Bank’s mission with Mobility Trust’s goal of fostering inclusion and empowerment.
Mobility Trust, a certified B Corporation, focuses on financing essential adaptive equipment, such as wheelchair-accessible vehicles and home modifications. TAB Bank recognized the organization’s unique mission and social impact as a compelling reason to step outside its typical business-to-business lending framework, demonstrating its commitment to underserved communities.
“We identified with their mission to empower underserved populations, particularly people with disabilities,” Curtis Sutherland, head of Sales and Business Development at TAB Bank, said. “This partnership represents a shared vision to bring greater access and opportunity.”
The loan structure offers flexibility and scalability, starting at $10 million with room for growth through syndication. This approach ensures Mobility Trust can continue expanding its reach into both vehicle financing and home modifications, addressing the growing needs of an aging population. TAB Bank worked closely with Mobility Trust to design terms that maximize availability, including flexible collateral requirements and an innovative borrowing base.
Mobility Trust’s President, Craig Baker, emphasized the transformative potential of the deal: “Together, TAB Bank and Mobility Trust are driving down the cost of essential equipment, making it more affordable so people with disabilities can achieve their full potential.”
This partnership not only advanced TAB Bank’s commitment to innovative, socially impactful financing but also sets a precedent for supporting underserved communities through strategic collaboration and long-term vision.
