November 19, 2020
North Channel Bank Provides Liquidity Support for US Life Settlements Customers with Policy Repurchase Option
North Channel Bank offers US Life Settlements customers with short-term liquidity needs an interesting alternative to traditional financing. “This is the second time we have been able to support a customer, in this case Life Bonds Management NFG GmbH & Co. KG, by acquiring Life Settlements policies from them. At the same time, we have granted a repurchase option for these policies,” explains Stefan Rensinghoff, Managing Director of North Channel Bank. “This model is an attractive alternative, for example for fund initiators whose funds expire, to sell the existing policies and subsequently buy back the same policies for a new fund”.
North Channel Bank is the first to combine these two common products for the US Life Settlements market to provide a benefit to the customers. Funds that would otherwise have to sell policies to third parties to generate liquidity, e.g. for premium payments, should be interested in this option as well. Therefore, the bank expects strong demand in the US Life Settlement market for this attractive product.
Extensive Expertise in Asset Class US Life Settlements
North Channel Bank is one of the few institutions worldwide which finances investments in US Life Settlements. Financing is individually tailored to the term and structure of the investment. Portfolio acquisition, payment of recurring premiums, leverage or repayment of existing loan liabilities may be covered. There are various ways to invest in this asset class. For example, it is possible to invest in bank loans extended to long-term US Life Settlements customers. Co-investments in US Life Settlements together with North Channel Bank can also be an introduction to this asset class before an independent direct investment is considered. Based on many years of experience, the bank has developed methods to ensure the legal security of such investments.
North Channel Bank GmbH & Co. KG was founded in 1924 as the privately owned bank Bankhaus Oswald Kruber located in Berlin. In 2009, a North American group of investors with expertise in the US Life Settlements sector acquired the bank and renamed it North Channel Bank. In the following years, the bank developed into one of the leading institutions in US Life Settlement financing. For many years, the bank has been working with the experienced and renowned US servicer NorthStar Life Services, LLC, a former affiliate, and offers not only financing but also investments in US Life Settlements. The affiliate NorthStar Life Settlements Trading, LLC, Irvine, California, renamed in 2020, handles the trading of policies in this business segment. In the Structured Finance division, the bank focuses, in particular on financing in the renewable energy sector (focus: equity interim financing), capital goods, and growth financing.