What is Lombard lending and how does it work?

Lombard lending is a type of loan where you borrow against your investment portfolio (stocks, bonds, funds) without having to sell those assets. The bank holds your investments as collateral and lends you cash, typically up to a percentage of the portfolio’s value. You pay interest on the loan while your investments stay in place. It’s a way for high-net-worth individuals to unlock liquidity quickly – for example, to make a purchase or investment – while still staying invested in the market.

What assets can I use as collateral for a Lombard loan?

Generally, liquid and marketable securities are used as collateral. This includes publicly traded stocks, government and corporate bonds, mutual funds, ETFs, and sometimes cash-value life insurance policies. The assets should be easy to sell and not too volatile. Most private banks won’t accept things like real estate, private company shares, or cryptocurrency for a Lombard loan. The quality of the collateral will affect how much you can borrow – safer assets like government bonds can support higher loan-to-value ratios than risky stocks.

How much can I borrow against my investments (what is the typical LTV)?

It depends on the asset mix, but typically around 50-60% of the portfolio’s value is common. For example, a £10 million portfolio might secure a £5 million credit line. If your investments are very stable (like a portfolio of government bonds), some banks may lend more (up to 70-80% in select cases). If the assets are volatile or concentrated in one stock, the bank will be more conservative (maybe 40% or less). The exact loan-to-value (LTV) is decided by the lender’s risk team based on your asset quality and diversity.

What happens if my portfolio value drops – will I lose my investments?

If your portfolio’s value falls significantly, the loan-to-value will increase. If it goes beyond the agreed threshold, the lender may issue a margin call. That means they’ll ask you to either add more collateral (additional assets or cash) or partially repay the loan to reduce the balance. You usually get a short window to do this. If you don’t meet the margin call, the bank has the right to sell some of your pledged investments to bring the LTV back in line. So, while you won’t automatically “lose” all your investments, the bank can liquidate enough of them to cover the loan safety margin. It’s important to monitor your portfolio and keep some buffer to avoid forced sales at a bad time.

Are Lombard loans regulated and safe?

Lombard loans are generally not regulated by the FCA in the same way as residential mortgages or consumer loans, because they’re considered commercial arrangements and often used by HNW or sophisticated clients. That means you don’t have certain consumer protections. However, they are a long-established practice in private banking and, when used prudently, are a safe form of borrowing for those who understand the risks. The safety largely comes down to how well you manage the loan – maintaining sensible borrowing levels and being prepared to respond to margin calls. It’s wise to get professional advice (and most banks only offer Lombard facilities to experienced investors). Also, ensure you’re working with reputable, regulated banks. The process itself – pledging assets and drawing a loan – is straightforward and contractually clear. Just remember that because it’s not FCA-regulated, you must be extra diligent in understanding the terms and consequences.

Can I use a Lombard loan to buy property or for other investments?

Yes, absolutely – that’s a common use. Lombard lending is often used to finance property purchases (either as a short-term bridge or even alongside a mortgage) because it allows you to raise funds quickly for a deposit or even full purchase without liquidating investments. It’s also used for investing in businesses, paying tax bills, or any significant cash need. Essentially, once the loan is drawn, it’s cash in your bank account – you can deploy it as you wish (with the general expectation that it’s for legal, financially sound purposes). Many HNW clients use Lombard loans to seize time-sensitive opportunities, like buying an asset when it’s attractively priced or injecting capital into a venture. It provides a lot of flexibility. Just keep in mind, you’re still responsible for the loan and interest, so whatever you use the money for should have a clear plan for repayment (for example, refinancing with a longer-term loan or expecting a liquidity event). It’s wise not to use Lombard credit for extremely speculative bets; treat it as a strategic tool to complement your overall financial plan.

What happens if a pledged portfolio falls in value?

The lender may require additional eligible collateral, partial repayment or sale of pledged assets. This is why a prudent facility includes a buffer for market movement.

Private client guide · Updated August 2026

Lombard Lending Explained: The 2026 UK Guide for HNW Clients

How borrowing against an investment portfolio works, what private banks look for, and how to access liquidity without selling long-term assets.

10 minute read Reviewed by a specialist adviser Independent, whole-of-market advice

The short answer

Lombard lending is a loan or credit line secured against eligible investments. You retain ownership of the assets, but the lender can require more collateral or repayment if their value falls.

Explore Willow's Lombard lending service → Capacity, structures, case studies and specialist support

At a glance

What is Lombard lending?

Lombard lending—also called securities-backed lending or portfolio-backed lending—allows an investor to raise cash against eligible shares, bonds, funds or managed portfolios without first selling them.

The lender takes security over the pledged investments and assigns a lending value to each holding. The facility may be a revolving credit line, an interest-only loan or a fixed-term arrangement. Unlike a conventional mortgage, the quality and liquidity of the collateral usually matter more than salary alone.

Common structure Credit line or term loan Often interest-only and flexible

Security Eligible investments Assessed holding by holding

Indicative leverage Often 30%–70% LTV Not a universal lending range

Main risk Margin call If collateral value falls

Important: the maximum a lender offers is not necessarily the amount it is prudent to draw. A resilient facility normally includes a meaningful buffer for market movement.

Suitability

Who is Lombard lending suitable for?

It can work well for financially experienced clients with a substantial, liquid portfolio, a defined use for the capital and a credible repayment or refinance route. It is less appropriate where the portfolio is highly concentrated, illiquid or already supporting other borrowing.

Often a good fit

HNW or UHNW clients with diversified investments
Property buyers facing a time-sensitive completion
Entrepreneurs funding a defined opportunity
Family offices managing short-term liquidity
International clients with eligible global portfolios

May not be suitable

Little eligible collateral or no liquidity reserve
A single volatile shareholding dominates the portfolio
The plan depends on maximum available leverage
No clear repayment or wealth strategy
Low tolerance for margin-call risk

The key question is not only “how much can I borrow?” but “how much market movement can the structure withstand?”

The mechanics

How does a Lombard loan work?

Define the objective

The lender and adviser need to understand the amount, purpose, timing and expected exit. A property completion, business investment and tax payment may call for different structures.

Analyse the portfolio

Every holding is reviewed for liquidity, volatility, concentration, currency, custody and jurisdiction. The statement total is not automatically the lendable value.

Build the borrowing base

Eligible assets receive different advance rates or “haircuts”. Cash and high-quality bonds may support more lending than volatile equities or specialist funds.

Agree terms and custody

The parties agree the facility limit, interest, maintenance thresholds and control over the assets. Some lenders require investments to move to their platform.

Draw, monitor and repay

Once documented, funds can often be deployed quickly. The pledged portfolio is then monitored and the agreed repayment or refinance strategy remains essential.

Eligible collateral

Which investments can support a Lombard facility?

Private banks do not apply a single loan-to-value ratio to the whole portfolio. Each lender has its own eligibility rules and may value the same holdings differently.

Asset type	Typical lender view	What can reduce lending value
Cash and deposits	Usually highly liquid and easy to value	Currency mismatch, account restrictions
Government or investment-grade bonds	Often among the stronger forms of collateral	Duration, credit rating and market depth
Listed equities and ETFs	Commonly accepted, with asset-specific haircuts	Volatility, concentration and thin trading
Diversified managed funds	May be eligible where holdings and liquidity are clear	Redemption terms, leverage or opaque underlying assets
Single-stock positions	Possible with selected lenders, usually more conservatively	Issuer exposure and sharp price movements
Private or illiquid assets	Often excluded or heavily discounted	No daily price, long sale period or transfer restrictions

These descriptions are general only. Eligibility and lending value are lender-specific and can change with market conditions.

Use cases

What can Lombard lending be used for?

Property

Complete without selling investments

Fund a deposit, full purchase or timing gap while a longer-term mortgage is arranged.

Business

Move on an opportunity

Access working capital or acquisition funding without disrupting a long-term portfolio.

Tax and distributions

Bridge a known timing mismatch

Meet a liability or distribution while waiting for a planned liquidity event.

Wider planning

Coordinate assets and borrowing

Support family-office, trust or cross-border liquidity needs within a broader strategy.

Continue your analysis

The guide explains the facility. The Lombard hub helps you test the strategy.

Move beyond the fundamentals with interactive tools, deeper private-bank criteria and objective-led structures built around the decisions that determine whether a facility is workable.

Interactive calculator Model indicative borrowing capacity Estimate facility size, interest cost and available headroom.

Downside modelling Stress-test the margin-call buffer See how a selected market fall could change the facility LTV.

Private-bank credit lens Understand how lenders assess the portfolio Explore eligibility, concentration, custody, jurisdiction and exit.

Structure navigator Compare routes around your objective Property, business, tax timing and refinancing scenarios, plus guides and cases.

Open the Lombard lending toolkit Free to explore · No details required

Terms and cost

How much can you borrow—and what does it cost?

Many facilities sit somewhere between 30% and 70% of eligible portfolio value, but headline ranges can mislead. Cash, investment-grade bonds and diversified liquid funds may receive higher advance rates than concentrated or volatile equities. Some assets receive no lending value at all.

Portfolio size, diversification and liquidity
Facility amount and intended use
Asset and loan currencies
Borrower domicile and jurisdiction
Custody arrangements and bank relationship
Interest benchmark, margin and fees

Pricing is often expressed as a floating reference rate plus a lender margin. Arrangement, custody, valuation or legal costs may also apply. Compare the complete structure—not only the advertised margin.

Margin calls

What happens if the portfolio falls in value?

If pledged assets fall below the lender's required maintenance level, the borrower may need to add eligible collateral, repay part of the balance or permit asset sales. This is a margin call. The response window can be short.

A simple stress illustration £2m eligible portfolio · £800k facility · 60% maximum lending threshold

Starting position 40% LTV £1.2m maximum facility at the stated threshold

After a 20% fall 50% LTV £1.6m portfolio value against £800k borrowing

Indicative call level £1.33m A 33.3% fall from the starting portfolio value

Illustration only. Real facilities use asset-level lending values, maintenance thresholds and terms that vary by lender; interest and portfolio changes are excluded.

Prudent planning may include borrowing below the available maximum, holding unpledged liquid assets, modelling market falls, reducing concentration and agreeing in advance how a call would be met.

Read the detailed guide to margin calls and risk management →

Compare the route

How does Lombard lending compare with other finance?

Lombard facility

Portfolio-led

Can be quick and flexible, but creates market-value and margin-call risk.

Mortgage

Property-led

Usually designed for long-term property finance, with property valuation and affordability underwriting.

Bridging loan

Time-led

Useful for short property deadlines where a clear refinance or sale exit exists, but typically priced differently.

The right answer may combine facilities. A Lombard line can, for example, support a property completion before a longer-term mortgage replaces some or all of the borrowing.

Before approaching a bank

How to prepare for a Lombard lending application

Prepare a complete portfolio schedule

Include identifiers, market values, currencies, custody arrangements and any existing charges.
Set out the credit narrative

Explain the amount, purpose, timing, wider net worth and repayment or refinance route.
Choose a prudent facility size

Stress-test the structure instead of treating the maximum advance as a target.
Compare lender fit before applying

Different private banks value the same assets, jurisdictions and client relationships differently.

Why sequence matters: multiple uncoordinated approaches can weaken the presentation of a complex case. A clear lender-selection strategy is often as important as the portfolio itself.

Frequently asked questions

Clear answers before you pledge assets

Can Lombard lending be used to buy UK property?

Yes. It may fund a deposit, a full purchase or a short timing gap, and can sometimes sit alongside a mortgage. The wider structure, repayment route and buffer against market falls all need to be assessed.

Do I need a high salary?

Not always. Lombard lending is primarily collateral-driven, although lenders still review overall financial strength, existing leverage, jurisdiction and the purpose and exit of the borrowing.

Will I have to move my investments?

Possibly. Some lenders require custody to move to their platform; others may accept an agreed control arrangement with an existing manager. The investment, tax and service implications should be considered before proceeding.

How quickly can funds be available?

Liquid collateral can make underwriting faster than property-backed borrowing, but timing depends on portfolio analysis, bank onboarding, custody, legal documents and source-of-funds checks. “Within days” is possible in some cases, not guaranteed.

Are Lombard loans FCA regulated?

Many Lombard facilities are not regulated by the Financial Conduct Authority. The regulatory position depends on the borrower, lender, purpose and structure. Take advice specific to your circumstances.

Can a concentrated shareholding be used?

Sometimes, but lender appetite is narrower and advance rates are usually lower. The lender may require diversification, additional security or a more conservative facility size.

What is the difference between Lombard lending and a margin loan?

Both use investment assets as collateral, but terms, purpose, lender, account mechanics and regulatory treatment can differ. A Lombard facility is commonly arranged through a private bank as part of wider client borrowing rather than solely to trade securities.

Reviewed by Wesley Ranger, Founder and Director

Wesley has more than two decades of experience in specialist lending and private client finance. This guide is general information, not personal financial or investment advice.

Quick suitability check

Could Lombard lending be worth exploring?

This short check helps you identify the first questions a specialist is likely to ask. It is not a lending decision or personal recommendation.

Is your portfolio mainly liquid, marketable investments?

Is it reasonably diversified rather than dominated by one holding?

Do you have a defined use and repayment or refinance route?

Could you retain a buffer rather than draw the maximum?

Request a confidential assessment

Speak with Willow Private Finance

Turn a portfolio into a properly structured credit case.

We compare private banks and specialist lenders around your assets, objective, jurisdiction and appetite for risk.

01 Initial conversation and finance assessment are free

02 Independent, confidential and whole-of-market

03 UK and international HNW client experience

Speak directly with an adviser For a live requirement or an initial sense-check 0207 082 5175 Email the private client team Tell us the portfolio value, objective and timing Send an email → Start with a discreet WhatsApp message Useful for arranging a convenient time to talk Message Willow →

Please do not send sensitive financial documents through WhatsApp or ordinary email.

Confidential review Lombard hub