- Innovative service launched for a growing asset class
- Leveraging FVC experience in valuation services
- Innovative comprehensive approach for accurate and meaningful valuations
FVC has now launched Debtval - the private debt valuation service building on its many years of valuations experience in different asset classes. Private debt loans now require regular valuations under the AIFMD regulation in Europe and the provision of accurate valuations is critical for investors to gain confidence in this rapidly growing market.
Private debt is a type of illiquid instrument and defined as "Level 3" under accounting definitions, meaning that they have significant subjective inputs due to lack of available data. We have developed a robust methodology for valuing private debt drawing on our "Level 2" valuation expertise to provide an innovative service proposition.
Our methodology has three main components: an assessment of credit-worthiness, evaluation of the loan's liquidity and taking into account any covenant conditions. We have created models which combine these elements to extend existing approaches. We also use anchoring and calibration techniques in our valuation processes. Each valuation gives our assessment of the value of the loan and we provide data input values and calculation breakdowns to give further insight for our clients.
In addition to our valuation services we are able to provide consultancy and due diligence for investors or funds looking for an independent viewpoint prior to investment into any private debt instrument. Many of our client contacts are new to private debt and appreciate the insight and process we bring.
Our previous valuation experience in a variety of other asset classes means we understand the importance of the assessment of each instrument and creating modelling and data collection approaches. We also can provide access to our comprehensive portal reporting system and have a reputation for strong support and providing reconciliation of valuation differences.