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Apr 15, 2021

Loan servicing, insurance & compliance at MBA CREF21

SS&C attended the first virtually-hosted Mortgage Bankers Association CREF/Multifamily Housing Convention & Expo. This year’s attendance required no travel planning and provided commercial mortgage lenders and servicers a great opportunity to network safely and remotely.

Mar 10, 2021

Paycheck Protection Program part 2: banks must evaluate these considerations

As discussed in our first blog of this series, as Paycheck Protection Program (PPP) loans grow and become a material part of a lender’s financials, questions continue to arise around the appropriate treatment for these loans. Part one of this blog series, focused on the right processes to track and report on these loans to the SBA and to investors, as well as GAAP considerations as it relates to accounting for these loans.  Here, we will focus on the reserving considerations for PPP loans

Mar 9, 2021

Paycheck Protection Program: banks must evaluate these key considerations

The Paycheck Protection Program (PPP) was created under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) to help provide relief to small businesses through loans that are forgivable and guaranteed by the Small Business Administration (SBA). Lenders who process PPP loans earn a fee from the SBA upon funding the loan. In addition, PPP loans bear a 1% interest rate.

Jan 20, 2021

The next big shift—acquisitions to loans

Over the past three or four years, there has been a shift from acquisitions to lending among real assets investors. Commercial real estate prices increased starting in 2008 when acquisitions of both residential and commercial real estate were quite high.  The shift from acquisitions to lending to real asset owners/investors in need of capital is fast becoming a new trend. Lenders are able to earn on the interest of the loans rather than commit to an asset—particularly commercial which has seen a drop in value. That drop has been most dramatic during the pandemic, although the decline was beginning prior to March 2020. Investors who may have diminishing values in their real estate portfolio can turn to private capital to provide needed liquidity—particularly during the recent volatility in the market. 

Jan 15, 2021

Private lending funds: growth and challenges

There is no shortage of capital in this world. Real interest rates remain at or close to 0%. Investors continue to struggle to find adequate yield in traditional fixed income investments. Consequently, we have witnessed a dramatic rise in the creation of, and investor interest in, private lending/private debt funds.  Now more than ever, private debt funds and nonbank lenders need state of the art, innovative technology to support their private debt loan administration.   According to a Preqin Quarterly update report on private credit dated Q3 2020, the number of private debt funds in the market has grown to a record high.  As of October 2020, 521 vehicles were on the road seeking $295B in aggregate capital. Additionally, the number of funds in the market has grown consistently over the past five years and aggregate capital targeted has more than doubled since January 2015. (Preqin)

Jan 5, 2021

Wealth managers cannot ignore best execution obligations

As regulators around the globe beef up their enforcement of best execution rules, wealth managers need to pay attention now more than ever. When trading assets, brokers are required to seek the best execution reasonably available to fill their customers' orders. Similarly, advisors need to prove that their client’s total costs (or proceeds) in each transaction are the most favorable under the prevailing market conditions. For wealth managers, meeting best execution mandates means having a systematic approach in place to report on these fiduciary responsibilities.

Jul 23, 2020

Challenge equals opportunity: lessons for lenders from COVID-19

Six months ago, the lending industry was operating much as it had done for many years. Where other financial services organizations have seen significant advances in the availability and adoption of technology to automate and streamline operations, paper forms are still commonplace for lenders. These forms are often walked from one side of the office to the other, and handed from one staff member to another, with a notable lack of straight through processing.

Jul 16, 2020

Mezzanine lending strategies and solutions

SS&C recently participated in an online panel with IMN to discuss tranched loan workouts, forbearance and restructuring. Topics included lender strategies for defaulted loans and managing mezzanine loan foreclosures.

As the panelists pointed out, the mezzanine holder is sandwiched between the mortgage holder (Lender) and equity holder (Borrower), so the rights and limitations of this structured debt are governed primarily by the intercreditor agreement. The ability to constructively interact with the mortgage lender for any remedies is essential for maximizing returns on mezzanine debt.

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