Through our close-knit relationships across our firm, our full range of expertise is at your fingertips. Helping you deliver first class service to your clients that transcends across their personal and business worlds. Jenny Sargeant, partner lead of our specialist private banking team sits down with insolvency partners Jeremy Whiteson and Sophie Burke.
In a nutshell what’s your area of expertise?
Jeremy Whiteson (JW): I deal with all types of corporate insolvency and a variety of related corporate transactions.
Sophie Burke (SB): my expertise lies in insolvency and restructuring; providing enforcement strategy advice, and facilitating the implementation of these strategies.
When do you come across private banks or their clients in your practice?
JW: I act for private banks on loan enforcements, receiverships and related enforcement issues.
SB: Additionally, we support private banks on an advisory basis for security we haven’t prepared, for example carrying out security reviews either for specific cases to highlight any issues to be factored into enforcement strategy or on a broader basis carrying out internal checking for housekeeping purposes e.g. spotchecking across all live loans.
Can you give an example of where you best add value?
JW: By strategic planning. When we are alerted that there may be a potential issue we carry out an “under the bonnet review” checking all documentation, relevant CPs and processes. With this detailed understanding we can then provide strategic advice to tailor the enforcement approach to the bank’s priorities, any relationship considerations and a roadmap for a smooth and successful enforcement. Strategic planning often allows us to improve the position of the private bank by amending documents prior to enforcement action commencing or choosing a specific enforcement route that best suits the factors at play.
SB: By having a thorough awareness of the many different options that might be available to the bank and listening attentively to the bank’s objective to assist in identifying the optimal path forward. A security package is usually designed, at the outset, to give a bank many different “levers to pull” at the time of enforcement, building in optionality of approach depending on the circumstances the bank finds itself in at that point of time. Enforcing at property asset level and appointing
a receiver is sometimes seen as the simplest and lowest cost approach but there are other routes that can assist that may give a better recovery, especially where, for, a property is mid development or there is an ongoing business (such as a hotel operational asset).
Do you have a mantra or saying that best describes how you work?
JW: Plan early.
SB: Understand your opponent; anticipate and prepare for their next move.
What do you enjoy most about what you do?
SB: Undoubtedly the people; building long term professional and trusted relationships with clients and really getting to understand what is driving them.
JW: The problem solving. Often in enforcement situations you are starting with a problem and our aim is to find a positive outcome or at the least an improved outcome for our client. It is also very satisfying to provide expertise where problems arise and to be able to help clients move things forward where blockages have occurred. This can really help reduce the stress for the teams that we support.
What do you think is key to assisting UHNW families in your area of expertise?
JW: By understanding that UHNW families will have a different “reality” which can be particularly evidenced in early stages of enforcement situations until a borrower fully understands the new situation and the impact of the sale of a property in terms of lifestyle adjustments. We are also mindful that security is often taken over residential properties and there is a very personal element at play which may lead to unpredictable responses to the bank’s reasonable requests.
How do you help private banks deliver first class service to their clients?
JW: It is always the hope that problems can be resolved and for private banks relationship is a cornerstone to their brand. We factor into our advice that there is often a personal element at play for borrowers (e.g. security may be over a home for the family or a family member) and there will be dynamics between different family members and security providers. It really helps for us to be involved early to discuss problems as they arise so we can support banks managing these dynamics without undermining their enforcement position.
SB: There is a delicate balance of dealing with problems as they arise and working with the borrower to resolve them whilst considering, in tandem, whether or not the bank should also be taking formal steps to reserve their position and how these are carefully (but transparently) handled.
How do you help private banks increase the quality and efficiency of their services?
SB: By instilling confidence in our client to bring us in early, we share the load from the beginning and can achieve better returns. Early intervention often increases the
likelihood of resolving issues with a range of options available, preventing the need for formal action.
JW: It is a question of working closely with the bank to understand what their priorities are and guiding them through the options as there are always choices available. Enforcement is also a testing of processes and procedures and it is really important to feed back any learning into transaction execution teams.
What would be the “one thing to watch out for” coming ahead in your area?
SB: Given the current unpredictability in the UK’s corporate and real estate markets, agility and swift decision-making are paramount. It’s challenging to forecast the sectors and corporations most likely to encounter difficulties, thus the necessity to adapt and address issues rapidly is essential—with the right advisors alongside you.
JW: Because of the business climate we are seeing enforcement scenarios more frequently for our private banking clients. Additionally there is an increase of global factors that might prompt a private bank to need to extract a borrower as a client (political risk, sanctions, legal action, regulatory concerns, a clash of acceptable market practices between jurisdictions).
Our connections across our firm are here to provide you with all the expertise you need so if you want to continue any of these conversations or have any insolvency queries, please feel free to get in touch with Jeremy or Sophie.
For more information about Insolvency, please visit our website here.
For any Private Banking related queries please contact Jenny Sargeant.
