Firenze, a fast-growing FinTech specialising in Lombard lending for wealth managers, has entered into a strategic partnership with Monument Bank, a UK challenger bank dedicated to the mass-affluent segment.
The deal sees Monument committing £160m in funding to help Firenze scale its Lombard loan offering.
The companies claim this agreement is a landmark transaction for several reasons. Firstly, it expands access to Lombard lending opening opportunities previously reserved for private banking clients. Secondly, the magnitude of this collaboration between a challenger bank and an early-stage FinTech is significant. Additionally, the structure of the deal ensures that wealth managers and their clients do not need to alter their custody arrangements. Lastly, the collateral comprises portfolios of liquid securities, marked to market daily, an uncommon feature in forward flow arrangements.
Firenze CEO David Newman said: “This partnership made sense for numerous reasons. Like us, Monument is an innovative business, successfully challenging the traditional banking status quo and they showed deep enthusiasm for our vision to unlock Lombard lending.
“The demand in the market for Firenze’s Lombard lending offering has far exceeded our expectations and this facility allows us to meet the growing need for liquidity solutions from non-bank wealth managers and their clients.”
Wasim Khouri, chief commercial officer at Monument Bank, said: “We are thrilled to partner with Firenze, a fintech innovator that shares our passion for reshaping financial services. Lombard lending is a powerful tool that has long been the preserve of private banks, limiting access for many mass-affluent clients.
“At Monument, we believe this should change. By collaborating with Firenze, we are bringing Lombard to a wider audience—offering mass-affluent clients liquidity while allowing them to retain control of their investment assets. This partnership is a strategic step in our journey to offer more tailored solutions that help our clients preserve and growth their wealth.”
The partnership will significantly enhance Firenze’s ability to extend Lombard loans to a wider segment of wealth management clients. Traditionally, these loans were exclusive to private banking clients. However, as private banks raise their minimum wealth thresholds and more financial advisors move towards independent models, access to Lombard lending has become increasingly restricted.
Firenze’s offering has already gained significant traction, with multiple wealth managers integrating it into their platforms. The company currently collaborates with investment firms managing assets exceeding £50bn.
Lombard loans, which are secured against liquid investment assets such as equities, bonds, funds, or commodities, provide a flexible alternative to traditional lending. They enable clients to access liquidity without liquidating their investments, helping them avoid capital gains tax liabilities and maintain long-term financial strategies. Given the highly liquid nature of the collateral, these loans also offer competitive interest rates and significant borrowing capacity relative to portfolio value.
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