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Jeffrey Sweeney is an investment banker with years of experience in direct lending and corporate finance for small- to middle-market companies. He is the chairman and CEO of US Capital Partners, an innovator in small- to middle-market business lending. US Capital Partners has been providing prompt, innovative, and reliable financing solutions across the United States and abroad for more than a decade.

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Tuesday
Dec062016

Frank Villarreal Joins US Capital Partners as Vice President

Leading private investment bank for the lower middle market appoints additional Vice President following another year of strong business growth.

SAN FRANCISCO, DECEMBER 2016 – US Capital Partners Inc. announced today that Frank Villarreal has joined the firm as Vice President. Headquartered in San Francisco, US Capital Partners is a full-service private investment bank that makes direct debt investments, participates in debt facilities, and has wide distribution for debt and equity private placements for small and medium-sized businesses.

With 24 years of asset management and client relationship experience, Mr. Villarreal has a strong and distinguished track record at industry leaders such as Merrill Lynch, Hambrecht & Quist (Executive Financial Services), Credit Suisse (US Private Banking), J.P. Morgan Securities (Private Wealth Services), and Stifel Financial Corp. (Private Client Group).

Most recently at Stifel in San Francisco, Mr. Villarreal was responsible primarily for portfolio management for the firm’s private and corporate clients, and for developing the firm’s international clientele for domestic public and private investments. At Credit Suisse, he provided US private banking services for domestic and international clients, and at J.P. Morgan he provided asset management and credit solutions to targeted high net worth clients, while assisting private wealth clients with retirement plan strategies.

“I am extremely pleased to welcome Frank to the firm,” said Jeffrey Sweeney, Chairman and CEO at US Capital Partners. “Frank brings 24 years of experience in the financial services industry to US Capital Partners, and joins the firm’s Investment Banking group following another year of increased demand for our innovative, customized products and services. Frank’s responsibilities at US Capital Partners will also include sourcing and vetting alternative asset funds and capital raises for the firm’s Wealth Management division, with a focus on the high net worth client, family office, and independent wealth advisor channels.”

About US Capital Partners Inc.

Since 1998, US Capital Partners (www.uscapitalpartners.net) has been providing well-structured, custom finance solutions to private and public companies with up to $250 million in top-line sales revenue or project size. Headquartered in San Francisco, US Capital Partners is a private investment bank that makes direct debt and equity investments between $500,000 and $100 million, participates in debt facilities, and has very wide distribution for debt and equity private placements. The firm also offers financial advisory services for buy-side and sell-side engagements and for capital formation, including early-stage financings requiring equity or debt.

Monday
Nov282016

Why Donald Trump's Market Rally Echoes Ronald Reagan's

By Larry Light - Forbes.com

Donald Trump's election has sparked a stock market rally. Will it continue? The canny Nicholas Atkeson and Andrew Houghton, co-founders of US Capital Wealth Management in San Francisco, see parallels between Trump’s market impact and that of Ronald Reagan:

In November 1980, Ronald Reagan was elected president over Democratic incumbent Jimmy Carter. Americans decided that the country, driven by economic distress and international embarrassment, needed a big change and that Reagan's conservative, government-is-the-problem philosophy was worth a try.

Reagan decided to focus on economic issues first and foremost. In February 1981, he sent to Congress what some political scientists called some of the most sweeping revisions of budget and tax policy ever attempted. The cornerstones of his plan were an across-the-board tax cut and an effort to reduce the size and growth of the federal government."

Trump's Make America Great Again economic proposals of cutting taxes, reducing non-entitlement and non-military spending (the "Penny Plan") and increasing military and infrastructure spending are similar to what Reagan proposed but substantially larger.

Given the similarities in the economic agendas of the Reagan and Trump, we thought it might be instructive to look at the history of the S&P 500 index a month before the election through the end of the first 100 days of the presidency.



Donald Trump: could the market follow Ronald Reagan’s cue?
Sean Proctor/Bloomberg

Casual observation indicates there are similarities between how the stock market reacted to Reagan and how it is reacting to Trump. In the weeks before the election, the market depreciated. In the five days following the election, there was a sharp market rally.

During the first five trading days post election, the S&P 500 advance about 2% with both Trump and Reagan. The S&P 500 continued to appreciate through late November following Reaga's victory. From the election to the November peak, the S&P 500 advanced by almost 9%.

We have yet to see how the market will perform with Trump from now through the first 100 days. There are reasons to believe that the stock market will show better returns initially with Trump than it did during the early days of Reagan’s presidency.

  • When Reagan was elected, the 10-year Treasury rate was about 12.7%. Over the next year, it rose to 15.8%. Stagflation was stifling growth. On November 8, 2016 when Trump was elected, the 10-year treasury rate was about 1.86%. It is now 2.28%. Low rates today encourage spending and growth. Even as rates rise today, they remain very low and may be signaling accelerated economic growth. These two presidents most likely bookmark the all-time high and low in interest rates.
  • Reagan took office in January 1981. By July 1981, the U.S. economy was officially in recession. As Trump takes office, the economic data suggests growth is accelerating and there is a very low probability of recession in 2017.
  • Trump’s stimulus plan of $500 billion plus per year is substantially bigger inflation-adjusted than what Reagan proposed.
  • In the first 60 days of Reagan’s presidency, he was shot by John Hinckley Jr. It is unlikely any president including Trump will be shot.

From 1965 to 1981, the S&P 500 did not appreciate. During this bear market period, the market suffered a nearly 50% drawdown in 1973 and 1974. By the time Ronald Reagan became president, investor sentiment was very negative. Reagan’s presidency marked the beginning of an 18 year bull market.

POST WRITTEN BY:
Nicholas Atkeson and Andrew Houghton

Wednesday
Nov232016

Why Are Asset-Based Loans Priced Differently to Commercial Bank Loans?

An inside look into the cost structure of asset-based loans compared to commercial bank loans, and whether or not predatory pricing practices are at play.

Pie ChartMany small and medium-sized businesses don’t qualify for bank financing: either their credit scores are too low, the business is new, or other circumstances place them outside the strict lending parameters of a bank. Even if a business does qualify for a bank loan, the process may move too slowly for the company’s liking. Thankfully, alternative lenders like US Capital Partners can provide accounts receivable financing, machinery and equipment loans, purchase order financing, inventory loans, and much more. This type of financing, known as asset-based lending, or ABL, is on the sharp increase across many industries.

But why does ABL sometimes seem so expensive?

  • Is ABL perceived as riskier than commercial and industrial (C&I) loans?
  • Is this a case of predatory pricing by alternative lenders?
  • Is this an issue of scale, where larger allocations become cheaper to administrate?

Comparing Cost Structures: An Inside Look

Interestingly, the default rates on ABL and C&I loans are actually similar to each other. In both types of financing for smaller businesses, the risk-adjusted premiums are therefore similar too. However, ABL and C&I loans have very different cost structures. The cost of initial underwriting and of monitoring over time is low for C&I loans, while in ABL these costs are much higher. This is because ABL underwriting is more robust, and there is continuous monitoring over the lifetime of the loan.

In other words, the risk-adjusted interest component in ABL is really modest, just as in commercial lending. It is underwriting and loan servicing costs that drive up the overall cost in ABL. These underwriting and loan servicing costs are more like fixed costs. They are proportionally higher for smaller credits. For larger companies, these costs are amortized over greater financing amounts.

Is There Any Predatory Pricing?

There is a common belief, especially among hedge fund managers and sponsors, that there are inefficiencies and predatory pricing in the small business lending space. But they are wrong. What is driving the cost of ABL is a very different cost structure. Lenders in this space need deep underwriting and collateral monitoring experience, and unlike for C&I loans, the specialized task of monitoring assets extends across the loan cycle.

The ABL market is made up of many “pools” of lenders that have different risk appetites. Within each such pool, there is an efficient, competitive environment. But as a borrower, you need to know which pool to “fish” in. Borrowers need to be cautious which group they approach, given the risk profile of their business. This is difficult for an entrepreneur to know, and lenders may not necessarily reveal that they are in the wrong pool for you.

Tuesday
Nov152016

Britt Doyle Joins US Capital Partners as Senior Vice President

Leading private investment bank for the lower middle market appoints additional Senior Vice President following another year of strong business growth.

SAN FRANCISCO, NOVEMBER 2016 – US Capital Partners Inc. announced today that Britt Doyle has joined the firm as Senior Vice President. Headquartered in San Francisco, US Capital Partners is a private investment bank that makes direct debt investments, participates in debt facilities, and has wide distribution for debt and equity private placements for small and medium-sized businesses.

A thirty-year veteran of the capital markets, Mr. Doyle started his career as an institutional fixed-income salesman for Security Pacific Asian Bank in Singapore directly out of college. After receiving an M.B.A. in the late 1980s, Mr. Doyle moved to the private client side of the business, working for various large investment banks, including Kidder Peabody, Merrill Lynch, and UBS. The majority of his career, however, was spent as a member of Citigroup’s elite Family Office division, where he developed the knowledge and skill set necessary to work with ultra-wealthy families on a variety of relevant topics.

“I am extremely pleased to welcome Britt to the firm,” said Jeffrey Sweeney, Chairman and CEO at US Capital Partners. “Britt brings thirty years of experience in the capital markets to US Capital Partners, and joins the firm’s Investment Banking group following another year of increased demand for our innovative, customized products and services. Britt’s responsibilities at US Capital Partners will also include sourcing and vetting alternative asset funds and capital raises for the firm’s Wealth Management division, with a focus on the family office and independent wealth advisor channel.”

About US Capital Partners

Since 1998, US Capital Partners (www.uscapitalpartners.net) has been providing well-structured, custom finance solutions to private and public companies with up to $250 million in top-line sales revenue or project size. Headquartered in San Francisco, US Capital Partners is a private investment bank that makes direct debt and equity investments between $500,000 and $100 million, participates in debt facilities, and has very wide distribution for debt and equity private placements. The firm also offers financial advisory services for buy-side and sell-side engagements and for capital formation, including early-stage financings requiring equity or debt.

Tuesday
Nov082016

US Capital Advises on $10.6 Million Real Estate Term Loan for Paul Ryan Associates, Inc.

QuantumSphere

US Capital Partners Inc. provides financial advisory services to support the continued expansion of a leading residential and commercial real estate construction firm.

SAN FRANCISCO, NOVEMBER 2016 – US Capital Partners Inc. has advised on a custom-structured real estate term loan of up to $10.6 million for Paul Ryan Associates, Inc., a leading general contractor in the United States with licensed operations across multiple States from New York City to Hawaii.

Headquartered in San Francisco, US Capital Partners is a private investment bank that makes direct debt investments, participates in debt facilities, and has wide distribution for debt and equity private placements for small and medium-sized businesses. The firm has a history of successful closings in the commercial and residential real estate sectors.

“We are extremely pleased to have advised on the refinancing of this nationwide general contractor,” said Jeffrey Sweeney, Chairman and CEO at US Capital Partners. “Paul Ryan Associates approached US Capital Partners for assistance in refinancing its bank debt and securing additional working capital to support its current and future needs. In this case, US Capital Partners successfully advised on a $10.6 million real estate term loan for Paul Ryan Associates, carefully customized to meet the company’s unique needs.”

About Paul Ryan Associates, Inc.

Established almost 50 years ago, Paul Ryan Associates is an employee-owned construction firm that builds high-end, custom residential and commercial real estate and tenant improvement projects. The company operates as a general contractor in multiple States across the United States. With a passion for constructing custom homes, Paul Ryan Associates has built a reputation on the quality of its workmanship.

About US Capital Partners Inc.

Since 1998, US Capital Partners (www.uscapitalpartners.net) has been providing well-structured, custom finance solutions to private and public companies with up to $250 million in top-line sales revenue or project size. Headquartered in San Francisco, US Capital Partners is a private investment bank that makes direct debt and equity investments between $500,000 and $100 million, participates in debt facilities, and has very wide distribution for debt and equity private placements. The firm also offers financial advisory services for buy-side and sell-side engagements and for capital formation, including early-stage financings requiring equity or debt.