Public Sector Financing

Sienna IM’s Private Credit expertise’s open-ended or dedicated public-sector funds offer institutional investors an organised path to acquiring, holding, monitoring, valuing and, where appropriate, recovering euro-denominated loans granted to the French public sector, mainly to local authorities and public hospitals.

These loans are acquired on the primary and secondary markets as concerns local authorities and exclusively on the secondary market in
the case of public hospitals.

Coverage of medium-sized local authorities is a value-added feature specific to Sienna IM’s Private Credit expertise

These unrated and less liquid loans diversify the traditional allocations of “risk-free” rate pockets by offering a so-called “liquidity” remuneration premium, compared to the remuneration provided by OATs.

These loans make it possible to build “adapted” portfolios in terms of remuneration, average lifetime, depreciation and capital charges (SCR Credit zero or low) while entrusting the construction, monitoring and servicing to an experienced management company.

Given the fact that outsized returns can be found, despite low returns overall, we consider it appropriate to present a global service offer for this asset class offering the following benefits:

  • flexible fund allocation rules (underlying assets/maximum duration of receivables,
  • varied structuring possibilities: capitalizing, distributing or pass-through funds
  • a proprietary credit analysis (PESTM)
  • a broad sourcing capacity
  • full loan servicing
  • low management costs

For institutional investors, this offering allows them to diversify or complete their core fixed-income segment without acquiring or developing costly and time-consuming resources for analysis, sourcing and monitoring in-house.

And with competitive management fees, the offer gives investors an opportunity to take advantage of this under-the-radar asset class.