The capital markets offer an array of opportunities for asset managers seeking exposure across a company’s capital structure. In senior secured leveraged loans, strategies tend to focus on high-yield borrowers, par or distressed, in which portfolio diversification is a key discipline in managing credit risk across ratings and industries. Given the syndicated loan market’s enormous growth over the past few decades, including private credit, opportunities abound.
To actively manage loan portfolios, institutional lenders must collaborate with many key constituents – primary and secondary sales and trading desks, third-party fund administrators and trustees which serve as originators, market makers and fiduciaries. But as it exists today, the corporate loan market operates on inefficient data distribution methods and legacy, fragmented infrastructure that hinders its full growth potential.
Today, the $7 trillion broadly syndicated loan and private credit markets are operationally challenging, with a lack of real-time, digital connectivity amongst parties. Many complex moving parts are involved, and information flow is therefore naturally prone to delays and errors. Contact between agents and their lender clients is hampered by cumbersome administrative tasks, from manual data entry to making phone calls, sending emails and even, dare we say, working the old-fashioned fax machine.
These archaic practices, coupled with the many dynamic, granular datapoints required to manage proprietary books and records, leave lenders in a state of frustration. Lenders struggle to reconcile positions and cash flows provided by event notices received from the administrative agent.
Inevitably, all of these factors make it taxing for buy-side participants to obtain a comprehensive, real-time view of the loan details necessary to properly manage their portfolios and make the best-informed decisions.
Enter Versana: Modernizing the Loan Ecosystem with Real-Time Digital Data + Technology
At Versana, we are laser focused on ushering in the long-awaited transformation of the multi-trillion-dollar corporate loan market through our centralized digital data platform connected to administrative agents’ loan systems. As syndicated loan market experts, we are passionate about delivering straight-through processing, self-service capabilities, operational efficiencies and velocity to ultimately alleviate the huge amount of friction impeding the core ecosystem.
With an addressable market of over 10,000 institutional lenders, we’ve built the modern foundation for loan market innovation by automatically consuming digital notices as soon as they hit administrative agents’ books, aggregated on one platform. The buy side will now benefit from having a single, real-time view into borrower-related events, loan-level details and portfolio positions. This includes borrower global commitments and outstanding amounts as well as lender transaction histories, interest accruals and floating-rate contract details. It also includes immediate digital notifications of borrowers’ principal amortization and prepayments, interest and fee payments, repricings and base-rate contracts.
By minimizing reliance on outdated analog processes traditionally used to distribute corporate loan data, Versana’s digital notices finally put an end to the myriad of buy-side discrepancies to facilitate self-service capabilities for the market. The Versana platform is available via a user-friendly interface and secure, cloud-based APIs to cut the friction associated with manual outreach to administrative agents, thereby creating the operational efficiencies, cost savings and velocity that have been desperately needed since the loan market’s inception over 30 years ago.
We’ve also future-proofed our tech stack with smart-contract capabilities to help with data security, permissioning and future blockchain-enabled functionality when the time is right.
The Road Ahead: An Ongoing Commitment to Loan Market Innovation + Growth
As we continue to scale, we are tireless in our pursuit of syndicated loan market innovation. We’re excited to have engaged with the market’s leading fund managers and industry experts to form two buy-side advisory committees – one focused on operations, the other on the front office – enhancing communication and alignment as we work toward ecosystem transformation.
Looking to the future, there will be no shortage of opportunities to make a lasting impact. We’re currently working with an array of industry partners to embed exciting new features into our award-winning platform. Delivering the highest-quality loan data to the market by leveraging the most modern technology is merely our jumping-off point for growth, as we continue to bring about a corporate loan market revolution and enable more transparent, informed decision-making for all participants.
Ready to join the transformation? Get in touch.
