OakNorth Bank recently agreed to extend its revolving credit facility to the RAW Mortgage Fund to £40million.
The Fund has grown since the original facility was put in place in mid-2019 with assets under management increasing by nearly 100% to over £80 million. Simultaneously, the loan book grew to nearly 350 loans totalling more than £78 million.
Designed to assist the Fund with liquidity and to reduce cash drag, and a proportion held to meet investor redemptions, the OakNorth facility continues to serve the Fund well.
Tim Parkes, Managing Director, said “This is a huge vote of confidence in our Fund and testimony to our hard work over the last six years in creating an investment vehicle with very low downside risk. Our underlying loan book performs very reliably, helping us to deliver very consistent returns to investors. We have had no bad debt since we launched the Fund in 2015, have a first legal charge over each residential property underpinning the loan, and have an average loan to property valuation across the Fund of only 47%.”
Mohith Sondhi, Senior Director of Debt Finance at OakNorth added: “the Fund had strong loan book performance throughout 2020, and has a strong pipeline for 2021, despite the ongoing challenges being presented by COVID-19. Having provided the Fund with the initial £20m facility two years ago, we saw this as an opportunity to increase our support as the Fund pursues ambitious growth plans with regards to its assets under management.”