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ARTICLE · 24 FEBRUARY 2021

Assessing Lender Risk In Fund Finance Markets (GLI Chapter 2020)

Carey Olsen
Carey Olsen
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Despite being a relatively long-standing lending product, there have been limited public payment defaults by funds in the fund finance space, and consequently, few test cases to discuss or examine.

GlobalFinance and Banking
Robin Smith
Robin Smith
Alistair Russell
Alistair Russell
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Lawyers from Jersey and the Cayman Islands have contributed to Global Legal Insight's 2020 guide to assessing lender risk in fund finance markets.

A zero-risk product?

Despite being a relatively long-standing lending product, there have been limited public payment defaults by funds in the fund finance space, and consequently, few test cases to discuss or examine. As a result, the market has legitimately considered this to be a safe product for lenders, and encouraged more market actors to participate. However, with Brexit and the COVID-19 pandemic making a significant t negative impact on the socioeconomic climate, lenders need to be more alert than ever to their possible exposure1.

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