Equities First Holdings, a leader in alternative shareholder financing solutions, is experiencing growth in demand for its stock-based and marginal based loans. This is attributable to the tightening of the lending criteria by financial institutions and banks. Equities lending is growing in popularity as an alternative way for lenders who do not qualify for conventional credit-based loans to raise capital. According to Al Christy, CEO and founder of Equities First Holdings (EFH), stock-based loans are suitable for those seeking working capital because they offer fixed interest rates and have a higher loan-to-value ratio as compared to marginal loans. The fixed interest rates provided by the stock-based loans are great because they offer certainty to the borrower over the life of the transaction.
Christy notes that a majority consider stock-based loans and marginal loans to be synonymous despite their clear differences. Margin loans are characterized by loan-to-value ratios in the region of 10 to 50 percent, variable interest rates, a call for the money to be used for a specific purpose and liquidation of the borrower’s collateral without notice in the event of a margin call. On the other hand, stock-based loans are characterized by fixed interest rates, loan-to-value ratios in the region of 50 to 75 percent, are non-recourse and no restrictions on how to spend the money.
Al Christy believes that the reason why stock-based loans have taken long to be seen as a viable borrowing option is because in the past lenders often failed to return the stocks to the borrowers upon maturity or dumped the borrower’s security to the open market. He differentiates EFH from the unscrupulous lenders by stating that it operates with transparency and follows the counsel of regulatory institutions. Christy adds that the goal of EFH is to give clients the maximum benefit at the lowest risk possible.
About Equities First Holdings
EFH has been in operation since 2002 with its main form of business being offering alternative financing solutions to people. It offers loans to people against shares traded on public exchanges worldwide. The company has closed over 650 deals valued at $1.4 billion from inception to date.
The offices of EFH are spread out across nine countries. It also owns subsidiaries such as Equities First (London) Limited, Equities First Holdings Singapore Limited, Equities First Holdings (Australia) Pty Ltd and Equities First Holdings Hong Kong Limited. The success of EFH is attributable to its team of financial industry gurus.
For more information please visit http://www.equitiesfirst.com/contact