United Kingdom

Details

  • Service: Tax, Pensions
  • Type: Business and industry issue
  • Date: 09/01/2014

KPMG's Asset Backed Funding Survey 2014 

"Growth in the use of asset backed contributions (ABCs) has been largely driven by challenging market conditions in recent years. These conditions have persisted into 2013, and we’re finding that increasing numbers of companies and trustees are turning to ABCs to fund part or all of their deficits.”David Fripp, Pensions Partner at KPMG in the UK

The 4th edition of KPMG's asset backed funding survey shows that ABCs doubled in number over 2013, and we believe that growth will continue in the future.

Key trends and observations

The rate of new companies putting asset backed funding in place has accelerated, with 23 new ABCs made over the past year compared with seven new structures in our previous survey. Over the past year we have seen that:

 

  • ABCs worth £2bn were made in 2012/13, taking the total value of transactions to date to over £7bn.
  • The average transaction size has fallen considerably since our survey began, with an average size of £80m in 2013 compared with £323m in the 2010 edition.
  • Seven of the ABCs implemented over 2012/13 had a value of £25m or less, whereas previously only three structures of this size had been implemented.
  • The most common terms remain 15 and 20 years, however we are seeing an increasing number of companies implementing structures with terms of up to 25 years.  
 

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David Fripp

David Fripp

Partner

KPMG in the UK

0121 609 6005

david.fripp@kpmg.co.uk