Introducing Lombard Loans

Lombard Loans now accessible via the P1 Platform

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At P1, we understand the evolving needs of financial advisers and their clients. That is why we have partnered with Firenze to revolutionise the way clients can access cash when they need. This collaboration offers a seamless and efficient solution allowing clients to borrow against their investment portfolios.

What are Lombard Loans?

A Lombard loan is a flexible, interest-only credit facility secured against a client’s investment portfolio. This type of loan offers quick access to funds without the need to liquidate assets, making it an ideal solution for short-term liquidity requirements.

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Why choose Lombard Loan

  • Flexibility and Speed: Our platform provides loans from £25k to £5m+, secured against a client’s investment portfolio. Clients can draw and repay as needed, with interest-only payments made monthly via direct debit. The automated underwriting and monitoring processes ensure that funds can be accessed within hours.
  • Client Retention: By offering Lombard loans, advisers can address clients’ liquidity needs without moving custody or losing control of assets, reducing the risk of asset drain and enhancing overall client satisfaction.
  • Retain the Upside: By using a Lombard Loan via the P1 Platform clients still retain ownership of their investments, meaning they still benefit from any income, dividends or potenial investment upside of the portfolio.
  • Comprehensive Support: We provide extensive support, including training, marketing materials, and ongoing servicing through a branded app powered by Firenze. This ensures a smooth client journey from loan application to ongoing management.

Key features of Lombard Loans

  • Available Loans

    Access £25k* to £5m+ with a maximum LTV starting at 50%
  • Tax Efficiency

    Clients can now access liquidity without triggering a CGT event or breaking an ISA
  • Fee Structure

    Transparent arrangement and annual facility, ensuring clarity for clients.
  • Interest Rates

    Competitive loan rates based on SONIA (similar to LIBOR)
  • Flexibility

    Clients retain control of their portfolio benefitting from income and any performance gains
  • Digital Process

    Clients can sign up for loans using just their smartphone, a fully digital experience

Advisor Benefits

Retain Custody of Assets:

No need to move assets away from your management.

Automated Processes:

Streamlined underwriting and monitoring save time and reduce administrative burdens.

Enhanced Client Relationships:

Offer a valuable service that meets short-term financial needs, improving client loyalty and satisfaction.

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What to know more?

We’re holding a webinar on Lombard Loans and how they work on the P1 Platform. If you’d like to learn more about them, James Priday, P1’s CEO, and David Newman, Firenze’s CEO, will be doing a webinar about how they can help you deliver financial planning for clients who have liquidity needs but potential Capital Gains Tax liabilities, or don’t want to break an ISA.

17th July 13:00

30 minutes – free CPD

Once you’ve registered your interest, we’ll be in touch with the webinar link.

Understanding Lombard Loans

How much can I currently access?

Currently loans are available from £65k to £5m, but regulatory approval is being sought to offer loans for a little as £26k.

How long does a loan decision take?

Loan decisions are typically made in less than 24hrs, with the funds being deposited with 72hrs for most cases.

What is the typical interest rate on the loans?

Interest rates range from SONIA* + 1.95% – 3.25%

* (Sterling Overnight Index Average, similar to LIBOR rate minus credit premuim element)

What are the fees associated with the loan?

There is an application fee of between 0.25% – 0.50% and a 0.20 – 0.35% renewal fee

How it Loan To Value (LTV) calculated and what is the maximum I can borrow?

Actual LTV of each asset based on liquidity, volatility, currency and diversification of assets. Loans are secured against the investment portfolios with a maximum of 50% LTV up to 70%

Do I still retain control of my investment portfolio?

Yes, you retain control in terms of benefiting from any income or potential gains from the portfolio, but you will be barred from making withdrawal from the portfolio.

What wrappers can I use?

Lombard loans are only availale against ISAs and GIAs and any subpots of these. They are not available against Pensions.

What happens if the value of the investment portfolio decreases?

The loan provider retains the ability to make a Margin Call. If the LTV exceeds 70% early warning will be triggered and delivered through the app. On exceeding 80%, Margin call notice triggered, where market movements do not correct a margin call. At 90% LTV or 14 days non-response to margin call a close out will be triggered – with instructions for immediate sale of assets and move the LTV to below 50%.