First Citizens Bank Arranges Credit Facility Upsize for SG Credit Partners' ABL Verticals

Rhea-AI Summary

First Citizens Bank has upsized the credit facility for SG Credit Partners' asset-based lending verticals, SG Consumer Products and SG Commercial Finance. This increase supports SG Credit's recent addition of its Commercial Finance division and broader growth strategy. SG Credit Partners, a family-office backed lender, operates three verticals: Software + Technology, Consumer Products, and Commercial Finance.

The First Citizens Asset-Based Lending team has a long-standing relationship with SG Credit. Ryan Woody, COO at SG Consumer Products, praised First Citizens ABL for their expertise and agility in arranging additional financing. Chris Esposito, managing director at First Citizens Asset-Based Lending, expressed satisfaction in supporting SG Credit's growth trajectory.

Positive

• Upsizing of credit facility to support SG Credit Partners' growth
• Addition of Commercial Finance division to SG Credit's portfolio
• Long-standing relationship between First Citizens Bank and SG Credit Partners
• Expansion of SG Credit's lending verticals

Negative

• None.

Insights

Financial Analyst

The upsizing of SG Credit Partners' credit facility by First Citizens Bank is a positive development for both entities. This expansion supports SG Credit's growth strategy, particularly its new Commercial Finance division. For investors, this signals increased lending capacity and potential revenue growth for SG Credit Partners.

The deal highlights First Citizens Bank's strong position in the asset-based lending market, especially in lender finance. This could translate to higher fee income and strengthened client relationships for First Citizens, potentially boosting its financial performance.

However, investors should note that while this expansion indicates growth, it also implies increased risk exposure for First Citizens Bank. The success of this upsized facility will depend on SG Credit's ability to maintain a quality loan portfolio in its new verticals.

Market Research Analyst

This credit facility upsize reflects a broader trend in the financial sector towards specialized lending platforms. SG Credit's focus on sponsor-backed CPG companies and the lower middle market demonstrates a strategic approach to niche market opportunities.

The expansion into Commercial Finance suggests SG Credit is diversifying its portfolio, which could provide more stable revenue streams. For the market, this move indicates growing confidence in the lower middle market and consumer products sectors.

Investors should monitor how this expansion affects SG Credit's risk profile and returns. The success of this strategy could potentially influence other lenders to adopt similar specialized approaches, reshaping competition in the asset-based lending space.

NEW YORK, Sept. 3, 2024 /PRNewswire/ -- First Citizens Bank today announced that its Asset-Based Lending business served as lead arranger in upsizing the credit facility for SG Credit Partners' asset-based lending verticals comprised of SG Consumer Products and SG Commercial Finance, which focus on sponsor-backed CPG companies and the general lower middle market, respectively.

The upsize increases the credit facility to support SG Credit's recent addition of its Commercial Finance division as part of its broader growth strategy of focusing on new lending verticals. SG Credit Partners is a family-office backed lender with a broad credit platform consisting of three verticals: Software + Technology, Consumer Products and Commercial Finance.

The First Citizens Asset-Based Lending team has worked closely with SG Credit over several years to support their financing needs. "First Citizens ABL is well known as a premier bank with strong lender finance capabilities," said Ryan Woody, COO at SG Consumer Products. "We appreciated their expertise and agility in arranging additional financing capacity to meet our unique requirements."

"SG Credit Partners is continuing its growth trajectory, leveraging its proven ability to develop a well-structured portfolio," said Chris Esposito, managing director and group head for First Citizens Asset-Based Lending. "We're pleased to continue supporting them as they advance toward their business objectives."

First Citizens' Asset-Based Lending business works to meet clients' working capital needs by offering innovative structures that can help reduce funding costs and lower operational risks while helping to improve earnings by leveraging accounts receivable, inventory or fixed assets as collateral.

About First Citizens Bank
First Citizens Bank helps personal, business, commercial and wealth clients build financial strength that lasts. Headquartered in Raleigh, N.C., First Citizens has built a unique legacy of strength, stability and long-term thinking that has spanned generations. First Citizens offers an array of general banking services including a network of more than 500 branches and offices in 30 states; commercial banking expertise delivering best-in-class lending, leasing and other financial services coast to coast; innovation banking serving businesses at every stage; and a nationwide direct bank. Parent company First Citizens BancShares, Inc. (NASDAQ: FCNCA) is a top 20 U.S. financial institution with more than $200 billion in assets and a member of the Fortune 500™. Discover more at firstcitizens.com.

MEDIA RELATIONS:
John M. Moran
212-461-5507
john.moran2@firstcitizens.com

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SOURCE First Citizens Bank

FAQ

What is the purpose of First Citizens Bank's credit facility upsize for SG Credit Partners?

The credit facility upsize is to support SG Credit Partners' recent addition of its Commercial Finance division and broader growth strategy focusing on new lending verticals.

How many lending verticals does SG Credit Partners operate?

SG Credit Partners operates three lending verticals: Software + Technology, Consumer Products, and Commercial Finance.

What services does First Citizens Bank's Asset-Based Lending business offer?

First Citizens' Asset-Based Lending business offers innovative structures to meet clients' working capital needs, reduce funding costs, lower operational risks, and improve earnings by leveraging accounts receivable, inventory, or fixed assets as collateral.

How does this credit facility upsize affect First Citizens Bank's stock (FCNCA)?

The press release does not provide specific information on how this credit facility upsize directly affects First Citizens Bank's stock (FCNCA). However, it demonstrates the bank's continued growth in its asset-based lending business.