Value Creation with UHNWI Structured Lending

Summary

Structured Lending for Ultra High Net Worth Individuals (UHNWIs) requires more than a standard credit process.

It demands a high level of technical capability and organizational sophistication in credit negotiation and structuring, solid risk mitigation in line with the proportional level of risk taking, continuous risk monitoring and in case of unexpected default situations, comprehensive recovery measures. The more risk taking a transaction carries, the more organizational sophistication in credit risk management is necessary across the full value chain to be able to cope with the risk and ultimately create sustainable and long term value for the lending bank. Unlike standard lending, UHNWI financing often involves bespoke solutions with illiquid collateral, complex legal and cross border structures, and evolving client circumstances. Properly executed, it strengthens client relationships and creates value; poorly managed, it exposes institutions to hidden vulnerabilities and, in the case of its materialization, loan losses which can shake up an entire organization and destroy value and reputation.

Key Topics:

• Definition of UHNWI Structured Lending
• Why borrowing makes sense for the ultra-wealthy
• An overview of today’s market (players and types of lending)
• Typical risks in UHNWI Structured Lending and how to cope with it
• Risk-adjusted credit pricing and why this is of critical strategic importance
• Individual strategic positioning from a lender’s perspective
• Organizational and technical key pillars of success
• Why is lending risk often underestimated (common misperceptions)
• What to do in default situations to avoid actual losses (unexpected risk)
• Insights from real-world case studies (structuring and recovery issues)

Presenter

• Arndt Fauser, former Group Chief Credit Officer International & Deputy Chief Credit Officer Switzerland at EFG International
  Arndt Fauser served as Chief Credit Officer on the Group level at EFG International and VP Bank in the last five years. Overall, he has over 30 years’ international banking, Big Four advisory and consultancy experience. He worked for more than two decades at Deutsche Bank Group in various international senior credit structuring front office, advisory and credit risk roles within the Group’s international Wealth Management and Corporate and Investment Bank divisions. He also worked at KPMG in Switzerland, Germany and the United Kingdom in Financial Services Advisory and Corporate Finance and gained institutional consulting experience at BearingPoint as part of their Competence Group Risk Management in Frankfurt across Europe, Africa and Asia. He has expertise in corporate cash flow lending, acquisition and leveraged finance, corporate debt restructuring and complex UHNWI asset based finance on a global basis, including securities based lending, derivatives trading, whole life insurance policies, luxury residential and commercial real estate lending across a broad range of jurisdictions (including developments/constructions), concentrated financial and strategic shareholdings, hedge fund portfolios, private equity participations, Private Equity Fund Finance, business aviation, private super/mega yachts, art collections and complex legal loan recoveries. He holds a Global Executive MBA from INSEAD Business School in Fontainebleau, France, and a Bank Management Diploma from Bankakademie in Frankfurt am Main, Germany.

Introduced by Dr. Enrico Piotto, Board Member Swiss Risk Association, Group Chief Risk Officer and Member of the Group Executive Board at EFG International.

Agenda

17:45 Arrival & Name Tag Collection
18:00 Welcome and Introduction (Enrico Piotto)
18:15 Presentations (Arndt Fauser)
19:00 Q&A
19:20 Conclusion (Enrico Piotto)
19:30 Networking Drinks (all)
20:30 End

Chapter Event

This Chapter Event is free and open to members. We will be presenting one or more speakers to share their knowledge, updates and best practices on a specific risk topic. Within small groups of risk professionals, you can exchange thoughts and test ideas. This event is hosted by the chapter Credit Risk.