Funding Circle, a San Francisco, CA-based small business loans platform, closed its first $198m asset-backed securitization (ABS) of US small business loans originated through its system.
The deal marks the debut of Funding Circle’s US 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 deal saw demand from 18 institutional investors, ranging from asset managers and private credit funds to insurance companies and sovereign wealth funds.
Launched in 2010, Funding Circle is a global small business loans platform, connecting businesses who want to borrow with investors who want to lend in the UK, US, Germany, and the Netherlands.
So far, investors across Funding Circle’s geographies — including more than 90,000 retail investors, banks, asset management companies, insurance companies, government-backed entities, and funds — have lent $10.2 billion to 72,000 businesses globally.
In the USA, where the company is led by Managing Director Bernardo Martinez, Funding Circle has originated loans to more than 14,000 US businesses, with US borrowers currently averaging 11 years in business and $1.4 million in annual sales. In the country, it recently marked $2 billion of cumulative loan originations and $1 billion of loans under management.