Arun Tiwary’s Post

Borrowing relaxed for CAT I & CAT II AIFs Under the current regulations, Category I and II Alternative Investment Funds (AIFs) are prohibited from borrowing funds, except for brief periods (up to 30 days, four times a year) to cover temporary funding needs or operational expenses. SEBI has now allowed these AIFs to borrow funds to address temporary shortfalls in funds requested from investors for investments in portfolio companies, provided they meet specific conditions. https://lnkd.in/gB9vCFhS

Sebi issues guidelines for borrowing by Category I and Category II AIFs AIFs will now have the flexibility to borrow a maximum of 10% of their investable funds, but not more than four times a year, to cover shortfalls in investor commitments. This move by SEBI is intended to improve operational ease for AIFs. Any intention to borrow must be clearly stated in the AIF's PPM. Read more at: https://bit.ly/3AyUrUg  

AIFs will now have the flexibility to borrow a maximum of 10% of their investable funds, but not more than four times a year, to cover shortfalls in investor commitments. #SEBI #SEBIUpdates #latestupdates

AIFs will now have the flexibility to borrow a maximum of 10% of their investable funds, but not more than four times a year, to cover shortfalls in investor commitments. This move by SEBI is intended to improve operational ease for AIFs. #SEBI #Guidelines #SEBIupdates

Investment concentration norm in Asset Reconstruction Companies The Reserve Bank of India (“RBI”) vide notification dated May 16, 2018 specified that Category II and Category III Alternative Investment Funds (AIF) are considered as “Qualified Buyers” under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 which allows such AIFs to invest in Asset Reconstruction Company (“ARC”) or purchase Security Receipts (SRs) issued by Asset Reconstruction Trusts (ART). This is subject to the following conditions: - AIF can invest in ARCs as a part of their investment strategy; however, it cannot invest in SRs issued by the same ARC it has already invested in. - Additionally, the AIF can't invest in SRs backed by loans from companies affiliated with it. - Finally, the AIF is restricted from investing in SRs where the underlying non-performing assets come from banks that hold a significant stake (more than 10%) in the AIF itself. SEBI through an informal guidance note clarified that AIFs should calculate concentration limits when investing in ARC Trusts that hold Non-Performing Asset (NPA) loan accounts from various companies. Regulation 15(1)(c) restricts Category I and II AIFs from investing more than 25% of their investable funds in a single investee company. This limit applies not just to direct investments, but also to indirect ones made by investing in units of other AIFs or investments in ARCs. To ensure compliance, the Regulation requires combining an AIF's direct investment in a company with its pro-rata share of investment in that same company through another AIF. This combined exposure must not exceed the 25% concentration limit. In essence, the regulation prevents AIFs from exceeding their investment limits in a single company through indirect means. Contribution by Dishant Deshmukh #sebi #compliances #AIF

The SEBI (Alternative Investment Funds) Regulations, 2012 were amended and updated on August 6, 2024. The changes focus on (i) borrowing rules for Category I and II AIFs, and (ii) the maximum extension allowed for the tenure of Large Value Funds (LVFs) for Accredited Investors. A. Borrowing Guidelines for Category I & II AIFs: 1. Category I and II AIFs are generally not permitted to borrow or use leverage for investments, except for temporary purposes like operational needs. This borrowing is limited to 30 days and can occur up to four times a year, capped at 10% of investable funds. 2. SEBI now allows these AIFs to borrow in cases of temporary shortfalls when investors fail to provide committed funds ("drawdown amount") needed for investments. This borrowing is intended only for emergencies, such as when an imminent investment opportunity is at risk due to delayed investor contributions. 3. Additional Conditions: a) The borrowing must be disclosed in the AIF’s Private Placement Memorandum (PPM).  b)It should be used only as a last resort and cannot exceed 20% of the investment amount, 10% of the total investable funds, or the amount pending from other investors, whichever is lower. c)The cost of borrowing is charged only to investors who failed to provide the drawdown amount. d)The facility should not be used to give different drawdown timelines to investors.  e)Borrowing details and repayment terms must be disclosed regularly to all investors. 4. There must be a 30-day gap between two borrowing periods. B. Extension of Tenure for Large Value Funds (LVFs): 1.LVFs are allowed to extend their tenure by up to 5 years, provided two-thirds of unit holders, by value, approve. LVF schemes must comply with this rule by November 18, 2024. 2. Any LVF that has not previously disclosed an extension period, or whose extension exceeds the 5-year limit, must realign their tenure and update SEBI by December 31, 2024. 3. LVF schemes may also revise their original tenure, but only with the consent of all investors in the scheme. 4. Provisions in the SEBI Master Circular for AIFs related to LVF tenure extensions will no longer apply from the date of this circular. 5. Compliance and Implementation: a)These new guidelines are effective immediately. b) Trustees or sponsors of AIFs are responsible for ensuring that managers comply with the new rules and that this is reflected in the compliance report. #SEBI #AIFRegulations #Investments #Finance #SecuritiesMarket

Invest In a Treasury Bond -18% or Money Market Fund -12% — Which Is Better? 🏆 The results will surprise you! Here is a simple question: If you had Ksh 1 Million to invest for 10 years with no additional top-ups, would you choose? 💡 Option 1: An Infrastructure Bond yielding 18% per year (tax-free, with semi-annual payments to your account)? 💡 Option 2: A Money Market Fund with a 12% net return per year (after tax and fees, compounded monthly)? Today, I’m revealing the actual results based on numbers—not feelings. Here's how they stack up: Infrastructure Bond: ✅ Ksh 1,000,000 invested at 18% for 10 years. ✅ Total returns = Ksh 1,800,000 ✅ Final Value = Ksh 2,800,000 👉 180% return Money Market Fund: ✅ Ksh 1,000,000 invested at 12% for 10 years (compounded monthly). ✅ Total returns = Ksh 2,105,848 ✅ Final Value = Ksh 3,105,848 👉 211% return 🚨 The Winner? The Money Market Fund takes the crown, giving you an extra Ksh 305,848! But here’s the real secret: the longer you invest, the more the Money Market Fund skyrockets! Over 15 or 20 years, its returns would leave the bond returns looking ridiculous! The reason? Compound interest is the magic here! So, if you’re holding an infrastructure bond, make sure to reinvest those semi-annual returns in a compound interest investment to supercharge your wealth. Are we together? Did you think the results would turn out this way? Let’s chat in the comments! 💬

The key information you should know before making any financial decisions: 1. Private credit funds offer impressive returns of around 10%, making them look like great investments. 2. Private markets are less transparent compared to publicly traded assets. 3. Private credit funds generally carry a significant premium to safer assets, embedded in the high interest rates and fees they charge. 4. Economic downturns have a significant influence on the performance of private credit funds. 5. There is a notional expected loss of 3% to subtract from your returns. Here in the UK, and with PMJ Capital, we offer both a tax-efficient property-backed fund option, alongside direct investment options. Contact Damian Ainsley for more information if you are a financial advisor or wealth manager exploring private market options for your clients. #fund #wealthmanagement #investments #bestadvice #realestatedebt For more detailed insights, you can visit: [RSM Global - Are Private Credit Funds a Good Investment?](https://lnkd.in/eB4iCbtu)

The #1 obstacle for financial advisors to recommending private market investments is understanding the risk profile. Join our waitlist for our 2025 Guide to Real Estate Debt Comment "Guide 25" below #financialplanning #financialadvice #bestadvice #privatemarkets #funds

The Remara Credit Opportunities Fund returned 1.32% in September, giving investors an annualised yield of 15.79% (post fees)*. The Fund continues to perform above the benchmark rate, returning 11.49% above the BBSW rate since its inception (annualised). During the September 2024 period, the Fund increased its investment in a direct loan and added two new warehouse notes to increase its exposure to real estate assets through direct loans. It also divested from a business loan and asset finance warehouse trust. The Remara Credit Opportunities Fund is open to wholesale investors looking to tap into Australia’s private credit market while enhancing their investment portfolio with a growth fund. Investors can benefit from high, risk-adjusted returns, consistent monthly distributions and have the opportunity to reinvest and further grow their wealth*. View the latest performance report for the Fund, or contact our team based in Australia today to discover more about our range of credit funds. https://hubs.ly/Q02Vfxp20 *All investments carry risks and target returns are not guaranteed. Past performance is not a reliable indicator of future performance. The annualised yield shown is the existing monthly yield multiplied by 12. AMAL Trustees Pty Limited (ABN 98 609 737 604, AFSL 483459) is the Trustee of the Fund. Remara Investment Management Pty Limited (ABN 26 644 751 815, AFSL 546046) is the Investment Manager of the Fund. This information is a general description of the Remara Credit Opportunities Fund (APIR AMT1125AU) only. The Fund is open to wholesale investors only. Ben Dixon Timothy Wilson Catalina Castillo Hugo Hayman Andrew McVeigh David Verschoor