Welcome to Firenze's client referral portal.
Here you will find more information about Lombard loans and decide if they are the right choice for you.
Scroll down to discover more and to get in touch.
What is a lombard loan?
Lombard lending allows you to borrow against your existing cash and investments portfolio. Rather than having to sell your investments and miss out on potential returns, you can access liquidity quickly and without incurring potential tax charges.
How does a Lombard loan work?
A Lombard loan works by requiring the borrower to pledge liquid assets, such as equities, bonds, funds or commodities.
With a Lombard loan, you can borrow against your assets, typically up to a certain percentage of their market value. The specific percentage is determined based on various criteria, primarily focusing on the risk level and is known as the loan-to-value ratio.
Lombard lending requires ongoing monitoring, as naturally the value of the collateral will change daily in line with markets.
If the portfolio value falls, this may result in what is known as a margin call, which is a demand to top up the value of the portfolio if it falls below a required amount, essentially, the amount sufficient to cover the shortfall. In the instance of significant market downturns, Firenze has the right to sell the investment portfolio.
Would a Lombard loan right for me?
Lombard loans are extremely attractive due to the flexibility of the terms. You can draw down and repay when needed and only pay interest on funds that are utilised. However, Lombard loans are intrinsically linked to market performance and does require Borrowers to demonstrate their understanding of the associated risks.
