Channel Successfully Completes $85MM ABS Securitization
Minnetonka, MN – July 7, 2023. Channel, a leading lender specializing in equipment finance and working capital, announced the successful completion of its third working capital backed securitization, a significant milestone for the company. The $85 million issuance of asset-backed notes is collateralized by small business loans and advances across a wide range of industries.
The notes comprise four classes, each assigned ratings by Kroll Bond Rating Agency: AA (sf), A (sf), BBB (sf), and BB (sf). The transaction features a three-year revolving period and has the potential to expand up to $500 million. Truist Securities served as sole structuring agent and joint book-running manager, while Guggenheim Securities acted as a joint book-running manager.
Amidst a highly competitive supply environment, Channel not only garnered steady support from its existing investor base but also managed to attract five new investors. This success reinforces the investor community’s continued confidence in Channel, its servicing platform, and this asset class. By drawing in a diverse range of investors, Channel further expands its position as a trusted and reliable investment opportunity in the market.
"This transaction is a resounding testament to the capabilities of the Channel team in expanding volume and originating high-quality credits with attractive yields,” said Eli Sethre, Chief Financial Officer. “It reinforces the strength of our business model but also highlights the increased recognition of the Channel brand among institutional investors and underscores our commitment to win together by delivering exceptional value that fosters trust the financial market."
Mike McConnell, Vice President of Treasury and Capital Markets, said, “This accomplishment is particularly noteworthy as it marks our first-ever AA rating on a securitization transaction. Additionally, we achieved an advance rate of 93.5% through our class C notes. We appreciate the strong support from our existing base of investors and the ability to attract new investors as well. Overcoming a challenging competitive landscape to secure investors for a successful close further emphasizes investor community confidence in Channel and its asset class.”
Channel celebrates yet another significant milestone in its securitization efforts and looks forward to building on this success by remaining dedicated to empowering small business through advanced and creative funding solutions.
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Founded in 2009, Channel has established itself as a trusted and comprehensive independent lender, providing a holistic solution for equipment finance and working capital needs through strategic partnerships with equipment finance companies. With its headquarters based in Minnetonka, MN, Channel also maintains a strong presence in Atlanta, GA, Des Moines, IA, and Marshall, MN, ensuring widespread accessibility and personalized service for its valued SMB customers.