In the current financial world, it is noticeable that there is a strong appetite for alternative investment options from investors across the spectrum in an effort to diversify their portfolio further by investing in assets which may be broadly uncorrelated to stock-market investments and inflation-proofed. In recent years these types of investments proved to generate solid returns without outsize risk. In 2021 it is evident that the trend towards this type of investments grows stronger.
In a period dominated by two factors, such as Bank deposits providing zero profit and with the aggressive policy of central banks and official institutions to increasingly becoming the main buyers of institutional-grade bonds, small Institutional and retail investors were forced to look for alternative investments that provide passive income and risk-adjusted returns.
Under these conditions, a tremendously competitive and high promising alternative product was born, namely the London credit investment fund V.C.I.C public ltd, managed by Consulco Capital Ltd. A private equity open-ended fund with variable capital. In a few words, London Credit Fund invests through its subsidiaries into short and medium-term business loans which are facilitated in the UK. The underlying bridging loans are originated, underwritten, structured and prefunded by London Credit Ltd, a UK company and subsidiary of Consulco, which is a well-established, ten-year experienced London based short- and medium-term lender. For completeness, London Credit Ltd, retains the loans administration throughout the whole loan period up and until their full settlement.
Since all loans are collateralized with London property and considering the growth in the London property prices seen over the past ten years, the demand outstripping the supply and the high liquid and transparent real estate market, securing loans on residential real estate has many advantages and benefits such as reducing the overall loan to a minimal risk, even if the borrower defaults.
Up until today, London Credit Ltd facilitated more than £120 million worth of loans achieving an impeccable performance and collection rates.
Due to the attractiveness, over the last decade, London credit has become a core part of our investors’ portfolio generating incremental income in a well diversified portfolio. Despite the disruption caused by Brexit in 2016 and Covid-19 in 2020 London Credit continues to generate the targeted fixed income returns to well informed and professional clients in the Cyprus market. Since the launch date of the London Credit fund, 7 months ago, the fund has posted a healthy growth with asset under management reaching the amount of €8.9 million with an annualized target return to investors of 4% on Euro and 5% on GBP. This strong growth indicates the positive fund performance and the high level of interest from institutional clients and HNWI in a short period of time. The current fund unitholders consist of pension funds, provident funds, insurances, HNWI and companies.
The latest June performance review underlines how effectively we mitigate the risk of the fund. 91% of the collateralized properties are residential mostly located in London. It is worth noting that this type of properties is considered as one of the most prime investment assets in the world. The average loan term is 5.5 months with an average Fund Loan to value of 60%.
In an environment where asset managers should be ready to meet investors’ new demands amid more dwindling returns in traditional markets, London Credit fund is the investment solution to many. With London Credit’s proven track record of 10 years in a transparent, mature and liquid market like the UK, we are confident that we will continue to meet investors’ growing expectations.