Funding Circle closed its first asset-backed securitization (ABS) of U.S. small business loans originated through its platform. The $198 million deal marks the debut of Funding Circle’s U.S. securitization sponsorship capability and is the fifth securitization of Funding Circle business loans globally.
The transaction is rated by two ratings agencies, with its senior tranche earning an A- (sf) rating from Kroll Bond Rating Agency and an A3 (sf) rating from Moody’s Investors Service. The oversubscribed transaction saw demand from 18 institutional investors, ranging from asset managers and private credit funds to insurance companies and sovereign wealth funds.
“Funding Circle’s inaugural US securitization is a major milestone in our journey to build the infrastructure where any institutional investor can efficiently lend to small businesses,” said Bernardo Martinez, U.S. Managing Director, Funding Circle. “With our global securitization program and sponsorship capability, we’re proud to expand access to a traditional fixed income asset class for new types and styles of investors, while also providing diversified funding for small businesses to grow and drive the economy forward.”
To date, Funding Circle has originated loans to more than 14,000 U.S. businesses, with U.S. borrowers currently averaging 11 years in business and $1.4 million in annual sales.
Funding Circle is a global small business loans platform, connecting businesses who want to borrow with investors who want to lend.