Small-business lender Prospa has announced the introduction of a new junior funding partner into one of its Australian warehouse facilities that funds small-business loans and lines of credit.
The new funding partner has subscribed to Class B notes in the warehouse facility, which would lay the foundation for Prospa should it decide to pursue a term asset-backed security issuance.
The partnership enables Prospa to redeploy approximately $17.8 million of equity capital back into its Australian and New Zealand businesses.
These funds will be used to support the lender’s cash position and further the lender’s growth strategies by investing in the development of new and existing projects, according to Prospa.
In an announcement to the ASX, Prospa highlighted the positive attributes of the new funding partner.
“Prospa has partnered with a top-tier local junior funding partner who has a deep understanding of the Australian securitisation market and a long-term interest in supporting Australian small businesses,” Prospa stated.
“The transaction represents an important part of Prospa’s long-term capital management strategy.”
[Related: Prospa loan originations outpace forecasts]