Investments in the Minerva listed bond will fund asset-backed, short-term loans to companies in the UK, mainly for the purpose of property acquisition or development.
The loans will be made at a maximum 70% LTV, therefore providing a minimum 30% buffer before capital is put at risk.
The bond is targeted at investors who are seeking to keep their returns real at a time of sharply rising inflation.
“The Minerva listed bond has been launched to provide investors and savers with returns that are comfortably above inflation with the added benefit of asset-backed security,” said Ross Andrews, director at Minerva Lending.
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“Crucially, all the loans securing the bond are underwritten by an independent credit committee and are made at a maximum 70% LTV, which offers a significant buffer in the event of default.”
Funds invested in the bond will be spread across a range of loans to provide diversification and protection for investors.
Minerva Lending Management Limited will be making the underlying loans and it has completed £300m of loans to date with no loss of capital.
An independent credit committee will carry out checks on all borrowers and securities and Minerva will only invest in British/EU-based companies.
“…You have an asset to fall back on and recoup some or all of your capital should the borrower not be able to repay,” added Ross.
“This is a world apart from unsecured bonds and gives investors not only the potential for strong real returns, but also all-important peace of mind.”
Minimum investment into the Minerva listed bond is £1,000.
There is no upper limit, but the bond is not covered by the Financial Services Compensation Scheme.