Finding Yield

Posted on 27th June 2019 by Trevor in Blog |Finance in Focus

Where can you get a secure investment that is going to pay you 8-12% safely?

Finding yield is tough right now, with 10-year bond rates and worldwide national Reserve Banks’ benchmark interest rates all at record lows.

How low is low? Well, US 10-year bonds are yielding under 2%, while term deposits are generally paying under 3% in Australia and this is the highest in the developed world!

Japan is near Zero, USA and Canada are 2% or less, Europe is also near zero. So, finding yield is tough and it is a worldwide issue.

We are able to provide net returns of 8-12% p.a.

Finding yield may be tough ‒ but it’s not impossible.

There’s one reputable class of investment that’s delivering net returns of 8-12% per annum. It flies under the radar, because it’s often only available to sophisticated and wholesale investors.

Banner Asset Management master fund has provided an average return to its clients of 12.2% since 2010.

Let’s explain how it works.

Imagine a borrower wants to purchase a property, or a developer is looking to complete on a residential or commercial venture, but they struggle to obtain finance ‒ as banks are imposing tighter and tighter lending restrictions. The would-be borrower may have no option but to look for alternative funding sources.

That’s where Banner Asset Management can be of service. Banner Asset Management facilitates borrowers like these with private investors who wish to fund private mortgages via Banner’s funds.

How are good returns with Banner Asset Management investments possible?

There are three main reasons.

First, our borrowers are seeking alternative funding solutions at commensurate interest rates.

Second, our borrowers are typically seeking short-term solutions, so their primary concern is successfully obtaining timely finance rather than the interest rate applicable to the loan. Banner Asset Management offers structured loans usually for an 18 to 24-month term.

Third, the rates are part of the building process and are factored into the build price.

We follow rigorous credit criteria.

Don’t make the mistake of equating high returns with high risk.

Banner Asset Management’s process goes through various steps to minimize the chance of non-performing loans. Thus far we have had no major issue with any of our loans (except for one… and on that one, the fund made more money than was due if the loan had run its normal course).

First, we review all applications. We set the bar high. Any applications which fall below standard are declined.

Second, we impose a maximum Loan to Value of 75%. Should the borrower default, we can sell their collateral at up to 25% of its market value and still ensure our investors’ funds are whole. (NB: 75% is a maximum; the average is at 61%; the lowest has been 34%.)

Third, we require real property security. Investor funds are secured via a registered mortgage against the borrower’s real property. Where the applicant is a commercial entity, investors are also entitled to directors’ personal guarantees.

Fourth, we lend when we have a clear path of repayment, specifically pre-sales sufficient to cover the lend and interest upon completion of the build.

The main priority is the safety of our investors’ money.

Our track record is strong.

Banner Asset Management has the right formula. Since 2007, more than $4 billion of loans have been facilitated, delivering a weighted average return of 12.2% per annum.

When you combine an experienced leadership team with rigorous credit criteria, you get positive results. Every month, month on month.

Finding yield is tough right now ‒ but it is not impossible.

Please contact us today to learn more about how you can get invested with the Ebisu Income fund IOM.  Call 03 5724 5100 

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