- Swiss-Asia’s football finance note sales doubled from April
- Low global interest rates burnish appeal of such investments
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Investors’ money is pooled to form loans to soccer clubs for operating expenses or to fund signing players. The financing matures at different stages from six months to three years. The notes are listed on the Frankfurt exchange and the minimum investment is $125, 000. Accredited investors with assets of at least $2 million are eligible to invest under Singapore rules. For the 2016-19 cycle, the English premier league’s television rights deal increased 52 percent over the previous three year period to $8.2 billion, according to Swiss-Asia.
Risks would be if one of the companies buying the television rights went bust, according to Coleman.
The securities also highlight how individual investors are filling a gap to finance soccer clubs left by banks constrained by Basel III capital rules that make it more punitive to engage in risky lending.
“Banks are shoring up their capital book and reducing exotic lending to achieve a higher Tier 1 capital ratio, ” said Casey. "Football finance is classed as exotic, which gives us a chance to step in as an approved funder.”Before it's here, it's on the Bloomberg Terminal. LEARN MORE