By Brian Walters – Newsource Commercial Finance

On February 1st 2022 Masthaven Bank made the following announcement:

“Following a comprehensive strategic review, Masthaven Bank will be withdrawing from the UK banking market over the next two years.

Masthaven, which was founded as a non-bank lender in 2004 and acquired a banking licence in 2016, is today (Tuesday 1st February) communicating the news of its strategic withdrawal from the market to employees, customers, intermediaries, and other stakeholders.”

As long established Commercial Finance Brokers we have seen similar situations occur over the years and, in our view, there are a number of potential implications for the customers of any lender announcing its withdrawal from the market in this way.

On the positive side, as long as the terms of the loan are honoured by the borrower and the agreed repayments continue to be met the loan will continue as before.

However, there are a number of negatives as follows:

  1. It is highly likely that Masthaven Bank will be looking to sell its lending portfolio to a third party investor
  2. Where this has occurred in the past we have seen many situations where the borrower/lender relationship changes significantly to the detriment of the borrower
  3. An example of this is where the borrower might be seeking some support from the lender, e.g. a capital repayment holiday. In these situations, the new lender/investor, from our experience, is generally not accommodating
  4. As a general principle, a strong relationship with the lender is important to the borrower and the loss of that relationship is far from ideal
  5. If the lender has exited from the market there is clearly no future in the relationship and, that being the case, an alternative funding provider will need to be found

This is where we can help.

Newsource Commercial Finance Limited (Specialist Property Finance associated company) are one of the UK’s leading commercial finance master broker firms with direct access to a wide variety of specialist funders in the commercial real estate lending sector.

If your company currently has borrowings with Masthaven Bank we can review your ongoing requirements and your current loan with this lender to find you an appropriate competitive alternative lender.

We have almost 10 year experience in this market and in 2021 completed 175 lending transactions with a total loan value of £134M and used 25 different lenders in the process.

Furthermore, we will undertake a full financial review of your company’s funding requirements without any charge.

If this is of interest please contact Aaron at Specialist Property Finance.