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RM Secured Direct Lending focused on management of existing portfolio during coronavirus crisis

Snapshot

  • Corporate lending specialist 
  • £105.9mln asset value
  • Trust has shifted investment stance towards non-cyclical sectors
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Quick facts: RM Secured Direct Lending

Price: 79.04 GBX

LSE:RMDL
Market: LSE
Market Cap: £96.06 m
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We remain confident in our investment manager's approach in ensuring the portfolio is well balanced and set to deliver sustainable income and returns for shareholders

Norman Crighton, chairman

What RM Secured Direct Lending does

RM Secured Direct Lending PLC (LON:RMDL) is a UK-based closed-ended investment trust focused on secured debt.  

The company aims to generate attractive and regular dividends through loans sourced or originated by its asset management arm, RM Capital Markets Limited, with a degree of inflation protection through index-linked returns where appropriate.

The loans the company invests in are mainly secured against such assets as real estate, plant and machine or income streams like account receivables.

What it owns

The group owns RM Capital Markets Limited, which provides advisory, capital raising and risk management services, a direct lending platform, and currency and fixed income trading services.

Within RM Capital Markets is credit asset management business, RM Funds, a fixed-income specialist with a focus on secured lending and debt investments.

RM Secured Direct Lending has the VT RM Alternative Income Fund, which invests primarily in listed equities within the alternative income sector, including real estate investment trusts and other trusts in areas such as asset lending, direct lending, peer-to-peer lending, infrastructure debt and equity, property, structured credit investments and renewables.

How it's doing

In April, RM said the focus of its portfolio on real assets and businesses not linked to the economic cycle will enable it to weather the current coronavirus storm.

In 2019, the value of assets the group's rose to £119.5mln from £95.7mln as its portfolio performed well in more normal conditions but the corporate lending market has since been hit by the virus disruption and asset value had dipped to £105.9mln at the end of March.

 “Looking ahead to the rest of 2020, opportunities will arise. However, first and foremost will be the management of the existing portfolio", it said.

What the boss says: James Robson, chief investment officer

“Overall, the Investment Management team believe that despite the recent market volatility the portfolio is well-positioned to continue to deliver the stable returns which investors are seeking and in addition, there will be greater NAV growth as we target a return to the opening NAV,” 

Inflexion points 

  • Stability returns to secured lending market
  • Dividend payments maintained
  • UK economy starts to recover as lockdown restrictions ease

 

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Watch

RM Secured Direct Lending 'still has considerable buffer to meet its...

RM Secured Direct Lending PLC's (LON:RMDL) Pietro Nicholls tells Proactive London's Andrew Scott they've still got a considerable buffer to meet its dividend targets. He says the number one focus currently is the management of the existing portfolio however Nicholls suspects opportunities...

on 23/4/20

2 min read