Raymond James (RJF) said Tuesday that it had recently introduced a securities-based line of credit for financial advisors to offer high-net-worth clients as an alternative source of liquidity. Within the first month, 72 loans were booked with the product, according to the company.
The program, made available through Raymond James Bank, can be collateralized by multiple Raymond James accounts and can be used for any legal purpose, except the purchase of securities.
“The key benefits are twofold,” said Chet Helck (left), CEO of the Global Private Client Group for Raymond James, in a statement. “The first is flexibility: Assets in multiple Raymond James accounts can be pledged as collateral; the loan can be used for just about any purpose, access to the line of credit is available through wire transfer, automated clearing-house services or personal checks; and repayment options are flexible to suit the borrower.
According to Helck, the credit line’s second benefit is pricing. “Very competitive rates are offered as they are based on the value of assets collateralized, not on the loan amount,” he added.”
In addition, clients can use the liquidity in ways that don’t disrupt their investment strategy, says Katie Clark, senior vice president and product manager at Raymond James Bank.