MLC launches innovative funding package for financial advisers

MLC today announced that it will be launching an innovative loan package for financial planning firms in conjunction with sister company Clydesdale Bank. The loan package, called the 'MLC Strategic Partner Funding Program', bases lending against a financial advisory firm's cash flow stream, opposed to the traditional method of security over assets.

MLC and Clydesdale Bank, both members of the National Australia Bank Group, are the first financial institutions to form an alliance to offer a loan facility aimed specifically at financial planning firms.

The loan facility will provide financial planning firms with the opportunity to borrow money to fund the expansion of their business either by a management buy-out or acquisition. Loans will be underwritten by Clydesdale Bank's Specialist & Acquisition Finance division.

Peter Smith, head of IFA distribution at MLC, said:

"MLC has gained considerable experience working closely with IFAs in the UK via its' consulting business, Pivotal Consulting, and understands issues facing the sector.

"It has long been an issue for IFA businesses looking to use debt financing for growth, that banks have not generally understood the IFA business model and the attractive revenue streams that a well structured one can generate. We believe the MLC Strategic Partner Funding Program will be well received by IFA firms looking to use debt finance to grow their business as it is designed specifically with the IFA sector in mind and uses business cash flow as a key lending security."

Rick Kennerley, head of specialist & acquisition finance at Clydesdale Bank, said:

"We are pleased to be partnering with MLC to provide IFA firms with access to a loan facility which will enable them to grow their businesses. We are confident that our strengths coupled with MLC's financial advisory consulting expertise, will provide IFAs with a very attractive loan facility."

MLC is the world's third largest manager of managers, with more than £1bn of funds under management in the UK and £36bn globally.  In 2005, MLC was the UK's fourth largest selling multi manager.

Clydesdale Bank's Specialist & Acquisition Finance division has expanded this year by developing a national platform to focus on the acquisition finance market across the UK. The enhanced division assists businesses looking for advice and funding for corporate acquisitions.  By offering a bespoke, fully integrated, finance package to its customers, Clydesdale Bank aims to attract significant levels of new business at a key time in the bank's development.

Funding packages are subject to the Bank's terms and conditions and each deal will be assessed on a case by case basis.