These days, as traditional lenders continue to hoard their cash, United Trust Bank is increasingly being asked to refinance a wide range of assets for a variety of business reasons. For example, the asset finance team were approached recently by a group of companies in the construction sector which needed working capital to fund the initial costs of some large contracts. We were able to quickly organise inspections and valuations and subsequently advanced £300,000 secured against a fleet of unencumbered excavators enabling the customer to commence the contracts with the funding in place.
Having extended the range of assets we’ll consider for security, we recently announced a lower pricing structure for our asset finance business. Our 1% drop in rates now gives brokers even more options when seeking quick, flexible financing solutions for their prime rate customers.
At United Trust Bank we don’t believe in a ‘tick-box’ approach to underwriting and every application we receive is looked at individually. When considering a proposal we try to achieve a balance between the asset, the customer, the financial information and, if required, the potential for additional security such as a suitable guarantor. We can also be flexible and creative when it comes to structuring a workable deal, something the bigger banks can find difficult. If a proposal doesn’t immediately ‘stack-up’ we’ll look at ways we can adjust the individual elements of the deal in order to achieve an outcome which is acceptable for the bank and for the customer.
When considering an asset which fits our lending criteria we first check that it’s correctly priced for its age and condition. Using resources such as CAP guides for vehicles as well as auction sales data, trade publications, internet searches and talking to other experts we’ll gauge the current and future resale value of the asset. Being able to access expert opinion on high spec vehicles and construction equipment is crucial to getting an accurate understanding of the asset.
Next we aim to build a full picture of the health of the company and project it forward over the term of the proposed finance agreement. We’ll take into account factors relevant to the individual business, the sector in which it operates and trends in the wider economy. We also look at the people involved in the proposal, the directors and potential guarantors. Personal wealth can sometimes be considered to off-set a higher risk transaction.
Finally we look at the return for UTB. If the revenue generated doesn’t quite reflect the risk the bank is taking we’ll look at ways we can reduce the risk in some way, perhaps by agreeing a larger deposit, a shorter term or an accelerated payment profile.
Ambitious businesses need access to credit to enable them to grow. By working closely with brokers, United Trust Bank will continue to use its expertise, knowledge and flexibility to offer finance solutions which are good for the customer, good for the broker and good for the bank.