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Secured overdraft facility for greater financial flexibility

Ke secured wealth
Ke secured wealth

Secured overdraft facility for greater financial flexibility

The financial flexibility to meet your needs

Flexibility is important when you are navigating your finances. Standard Chartered’s Wealth Lending Facility allows you to explore new investment opportunities or increase liquidity for your personal needs.

Risks of Wealth Lending

Types of Risk

Leverage Risk

Depending on market conditions, the value of your collateral may fall. You may then be called upon to “top up” your account or to repay your outstanding credit facilities at short notice. It is a requirement that the value of the collateral is maintained at the required level. The Bank may have to liquidate your collateral at a loss to repay any amount outstanding and you would be liable for any amounts still owing subsequently.

Interest Rate Risks

The interest rate of your credit facility may increase, resulting in a higher interest payment amount for the facility.

Foreign Exchange Risks

Your credit facilities may be subject to additional foreign exchange risks if they are taken in a different currency other than that of your collateral. If the exchange rate moves against you, the repayment amount of the facilities may be affected.

Change in credit Loan to Value (LTV) ratio

LTV ratios are subject to periodic review and may change within a short period of time. When the LTV of your collateral is reduced, you will need to have sufficient liquidity to repay your outstanding credit loan or pledge additional collateral as security for the credit facility.

Leverage Risk

Depending on market conditions, the value of your collateral may fall. You may then be called upon to “top up” your account or to repay your outstanding credit facilities at short notice. It is a requirement that the value of the collateral is maintained at the required level. The Bank may have to liquidate your collateral at a loss to repay any amount outstanding and you would be liable for any amounts still owing subsequently.

Interest Rate Risks

The interest rate of your credit facility may increase, resulting in a higher interest payment amount for the facility.

Foreign Exchange Risks

Your credit facilities may be subject to additional foreign exchange risks if they are taken in a different currency other than that of your collateral. If the exchange rate moves against you, the repayment amount of the facilities may be affected.

Change in credit Loan to Value (LTV) ratio

LTV ratios are subject to periodic review and may change within a short period of time. When the LTV of your collateral is reduced, you will need to have sufficient liquidity to repay your outstanding credit loan or pledge additional collateral as security for the credit facility.

What is Wealth Lending?

Overview of Wealth Lending Overdraft Facility

FAQs

  • Our Wealth Lending Facility is an overdraft facility obtained against financial assets held with, and acceptable to the Bank up to a percentage of their prevailing market value.

  • This is the risk that the bond issuer or borrower is unable to meet the coupon or principal payments on any outstanding bonds or debt (not just the bonds you may be holding) when they fall due (for example, due to bankruptcy or insolvency), and go into default.

  • Interest rates and bond prices are inversely related. Should interest rates rise, the price of your bond will tend to fall (and vice versa). The longer the time to maturity of a bond, the greater the interest rate risk.

  • Unlock the value of your long tenor assets like bonds and mutual funds when you need liquidity.

  • Interest is calculated based on utilised loan amount on a daily basis.

  • Choose to borrow in multiple currencies, such as USD, GBP, EUR and KES.

  • The available credit limit under this facility will be determined based on a range of factors. Such as but not limited to:
    ◦Type of financial asset used as a security.
    ◦Prevailing market value.
    ◦Concentration of the financial assets within your portfolio held in the bank.

Terms & Conditions

Disclaimer

Investment Products and Services are distributed by Standard Chartered Investment Services Ltd – a wholly-owned subsidiary of Standard Chartered Bank Kenya Limited, that is licensed by the Capital Markets Authority as a Fund Manager.