Direct Lending fund looks to fund raise new cash

By Daniel Lanyon on Wednesday 8 May 2019

Alternative Lending

The investment trust launched back in 2016 targeting a yield of 6 per cent and a total return of 7-8 per cent by offering exposure to alternative credit loans to UK SMEs.

The £141m  Hadrian's Wall Secured Investment trust will likely raise new capital, according to a stock market update 

Launched in June 2016, the SME-focused direct lending portfolio aimed at mid-market loans, initally raising £80m.

In the first quarter of 2019 the fund's investment manager said it had seen strong deployment in the quarter with £36m of new investments and that the fund has now fully drawn its £25m facility with Shawbrook Bank. Its average portfolio yield is now 9.3 per cent and the weighted average life is 2.9 years. It added that a new fundraise may be on the cards in an investor update.

Analysts at Liberum said it may look to raise further equity to manage liquidity requirements after  reporting a strong pipeline of lending opportunities.

“We calculate a 12-month NAV total return of 4.2 per cent. Assuming there are no loan performance issues, we would expect the run-rate on returns to be higher given the company is now fully deployed and the relatively high yield of 9.3 per cent on the portfolio.”

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