Lombard Lending in Singapore: Liquidity Without Selling Your Portfolio

How Lombard lending works in Singapore private banking—LTVs, eligible collateral, haircuts, and when portfolio credit is smarter than selling assets.

A Lombard facility collateralised by your securities provides flexible liquidity for tax payments, real-estate bridges, or opportunistic investments—without triggering sales.

1) What banks typically accept

• Highly liquid bonds/blue-chip equities/UCITS funds: core collateral.
• Alternatives/PE funds: lower or zero LTV; often excluded.
• Single stocks with volatility: tighter LTV and dynamic haircuts.

2) Indicative LTV bands (illustrative)

• Government bonds / IG bond funds: 60–80%
• Investment-grade diversified funds/ETFs: 50–65%
• Blue-chip equities / equity ETFs: 40–60%
• Concentrated/small-cap equities: 20–40% Banks adjust LTVs with market conditions; always get current term sheets.

3) Pricing & structure

• Rate: reference (e.g., SORA/SOFR) + spread tied to AUM/quality.
• Covenants: top-up clauses, margin call thresholds, concentration limits.
• Use cases: property completion bridge; monetise embedded gains without selling; tactical buys in sell-offs.

4) Risk you must underwrite

• Gap risk: fast drops cause immediate calls.
• Concentration: single-name exposure accelerates volatility.
• Cross-currency: borrowing in one currency against assets in another invites FX risk.

5) A simple decision framework

• If need < 12 months and collateral is liquid → Lombard often efficient.
• If cash need is long-dated → consider partial asset sale or term credit.
• Simulate a stress 25–35% drawdown to ensure you can meet calls.

Lombard loan Singapore, portfolio financing, LTV by asset class, margin risk, liquidity planning, credit solutions

Written by: BankOpen Singapore Editorial Team
The BankOpen Singapore Editorial Team consists of financial analysts, banking industry professionals, and experienced writers. We are dedicated to providing accurate, up-to-date, and practical insights to help readers navigate Singapore’s banking landscape and make informed financial decisions.