NAV facility
Draft definition. Technical and editorial approval pending.
Fund-level borrowing assessed against the value and cash flows of existing investments rather than primarily against uncalled investor commitments. Security may cover holding-company assets, interests in investment vehicles or distribution rights. The exact collateral and enforcement rights depend on the structure, documents and law. A reported portfolio value does not by itself establish what has been pledged.
In practice
A fictional fund borrows against interests in investment vehicles and related distribution rights. Those rights are distinct from the collateral pledged by an originator to its own lender. Review both levels: fund-level borrowing can affect the provider’s liquidity without changing the originator’s contractual draw conditions.
Read this in context: How Facility Funding Works.