For many high-net-worth individuals, wealth is concentrated in investment portfolios. Shares, bonds, and managed funds often carry significant value, but accessing that capital without selling can be difficult. Disposals may trigger capital gains tax, disrupt long-term strategies, or erode positions carefully built over time.

Securities Backed Lending (SBL) has emerged as a flexible alternative in 2025. By using an investment portfolio as collateral, clients can raise substantial liquidity while maintaining exposure to market growth. Increasingly, borrowers are turning to SBL not only for wealth planning but also for property finance. Just as private bank mortgages offer tailored solutions beyond high-street lending, SBL sits at the heart of bespoke financing strategies for wealthy clients.

What Is Securities Backed Lending?

SBL is a type of asset-backed loan that allows borrowers to use their investment portfolio as security rather than relying on traditional property collateral. Instead of liquidating their positions, clients pledge their securities to a lender, typically a private bank, investment bank, or specialist lender.

The pledged assets remain invested, but they are charged to the lender. If the portfolio value falls, the borrower may be required to top up collateral or repay part of the loan. If it rises, they continue to benefit from capital growth and dividends.

In 2025, lenders are generally willing to advance between 50 and 70 percent of the value of liquid, diversified portfolios. Investment-grade bonds might attract the highest loan-to-value ratios, while more volatile equities or concentrated holdings are subject to more conservative terms. Repayments are often structured as interest-only facilities or bullet repayments at the end of the term, aligning with liquidity events such as property sales or business exits.

Why Borrowers Choose SBL in 2025

The appeal of securities backed lending lies in its ability to provide liquidity without disrupting long-term wealth strategies. Selling a portfolio can crystallise capital gains and remove exposure to future growth. For high-net-worth clients who take a long-term view, this is rarely desirable.

SBL also provides speed. Whereas traditional mortgage underwriting can take weeks, particularly for complex income profiles, an SBL facility can sometimes be arranged in a matter of days, since the focus is on portfolio valuation rather than employment income or credit history.

For international clients, this is especially valuable. Many overseas buyers find UK lenders cautious about foreign income or tax structures. With SBL, the portfolio speaks for itself. This makes it comparable in speed and flexibility to short-term property finance, but with a different type of collateral.

Flexibility is another factor. Unlike regulated mortgage products, which are tied to property, SBL proceeds can be used for a wide variety of purposes. Whether funding a property purchase, covering business expansion, or even supporting philanthropic projects, clients have greater control over how capital is deployed.

Who Benefits from Securities Backed Lending?

SBL is most commonly used by wealthy individuals and families with substantial, liquid portfolios. However, its application has broadened significantly in recent years.

International buyers are a major user group. For those without a UK credit history, arranging conventional property finance can be slow or impossible. Leveraging an overseas portfolio allows them to complete quickly on a London purchase. Similarly, returning expats, who might face hurdles due to years of overseas income, often find SBL a smoother path to liquidity than traditional lending.

Developers are also turning to SBL. For those with existing portfolios, the facility can release liquidity to cover early-stage project costs such as land deposits or planning fees. In this sense, SBL is being used alongside development finance as part of a layered funding strategy.

Ultra-high-net-worth families use SBL for broader wealth planning. Facilities may be structured to provide intergenerational support, fund lifestyle acquisitions, or manage liquidity for estate planning. In some cases, SBL is integrated with trust-based property finance, providing both flexibility and tax efficiency.

A Practical Example

Consider a client with a £5 million global equities portfolio managed by a private bank. They wish to acquire a £2 million London townhouse but want to avoid selling assets and triggering a large US capital gains liability.

By structuring a securities backed facility at 60 percent loan-to-value, they release £3 million against the portfolio, easily covering the purchase. The assets remain invested, generating returns. Within 12 months, the client refinances with a conventional long-term mortgage, repaying the SBL in full.

This type of hybrid solution — immediate liquidity followed by strategic refinancing — is increasingly common in 2025, especially in the prime London property market where speed and certainty are often decisive.

Risks in Securities Backed Lending

While the benefits are clear, borrowers must also be conscious of the risks.

Market volatility remains the key consideration. If portfolio values fall, lenders may demand additional collateral or partial repayment to restore agreed loan-to-value ratios. Margin calls of this kind can create liquidity pressure at the worst possible time.

Borrowers also need to be mindful of concentration risk. Portfolios heavily weighted towards a single asset or sector are less attractive to lenders, reducing borrowing potential. Similarly, illiquid holdings such as private equity positions are rarely accepted.

Another consideration is pricing. While interest rates on SBL are often competitive, they vary significantly across institutions. Private banks may offer attractive terms to deepen relationships, whereas investment banks may take a more transactional approach. In some cases, specialist lenders may provide access where mainstream banks cannot — but pricing will reflect the risk.

Finally, borrowers should remember that these are usually short- to medium-term facilities. Without a clear repayment strategy — whether through refinancing into large mortgage loans, selling a property, or managing cash flow — SBL can create challenges at maturity.

Securities Backed Lending in 2025: Market Trends

The appetite for SBL is expanding in line with global wealth trends. In 2025, more private banks are offering facilities as a core service for high-net-worth clients, while boutique lenders have entered the market with niche solutions for international borrowers.

Regulatory environments also play a role. In the UK, SBL is generally treated as unregulated borrowing, giving cliens greater flexibility but also placing more emphasis on advice and structuring. Meanwhile, in the US and Europe, tighter margin requirements mean facilities must be managed more actively.

Currency volatility is another factor shaping demand. With sterling moving against the dollar and euro, many overseas buyers are using SBL to fund acquisitions at favourable exchange rates, then repaying later when currency positions shift. This mirrors the way some clients already use foreign income mortgages to align borrowing with income flows.

How Willow Can Help

At Willow Private Finance, we understand the nuances of securities backed lending. Our team works with private banks, investment banks, and specialist lenders to identify the most competitive structures for our clients. We know how portfolios are assessed, how facilities can be integrated into broader property finance plans, and how to negotiate terms that provide both flexibility and security.

Whether you are a high-net-worth individual unlocking liquidity for a new purchase, an international buyer entering the UK market, or a developer funding a time-sensitive project, Willow can help structure a facility that protects your portfolio while delivering the liquidity you need.

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