Private Debt
Private Debt Readiness: The Documents Lenders Need Before Underwriting
A practical checklist for turning a financing enquiry into a lender-ready private debt submission.
Credit Glorious · · 5 min read
Private Debt Readiness: The Documents Lenders Need Before Underwriting
A private-debt request becomes easier to assess when the lender can understand the borrower, transaction and repayment plan without reconstructing the story from disconnected files.
The objective is not to produce the largest possible data room on day one. It is to provide a coherent initial package that answers the key underwriting questions and identifies what remains outstanding.
1. Executive financing summary
Begin with a concise document covering:
- the legal borrower and sponsor;
- the amount and currency requested;
- the purpose and use of proceeds;
- the preferred timing and tenor;
- the proposed repayment source;
- the available security; and
- the transaction’s current stage.
The summary should distinguish confirmed facts from projections and unresolved items.
2. Corporate and ownership information
Provide incorporation documents, registered address, ownership chart, directors, authorised signatories and the identities of ultimate beneficial owners. Include the principal operating entities and explain how they relate to the proposed borrower.
This information supports both credit analysis and compliance onboarding. An incomplete ownership structure can stop a review before commercial terms are considered.
3. Historical financial information
For an operating business, provide recent audited accounts where available, current management accounts, cash-flow information, existing debt and material contingent liabilities. Explain unusual movements rather than leaving the lender to infer them.
Historical performance establishes context, but it does not replace a forward-looking repayment analysis.
4. Forecast and debt-service model
The model should show revenue, costs, capital expenditure, working capital, taxes, existing debt service and the proposed facility. Assumptions should be documented and consistent with commercial contracts and the implementation timetable.
Include downside cases that test the risks most relevant to the transaction: delayed completion, lower sales, higher costs, customer concentration, currency movements or refinancing pressure.
5. Use of proceeds and sources-and-uses table
A clear sources-and-uses table shows how sponsor equity, existing funding and new debt fit together. For a project, link each funding source to the relevant development milestone.
Avoid broad descriptions such as “growth capital” when the proceeds will fund identifiable assets, acquisitions, construction or refinancing.
6. Asset and security information
Describe the assets or rights proposed as security, their ownership, location, valuation and existing encumbrances. Relevant materials may include title documents, asset registers, valuations, insurance, material contracts, receivables schedules and account structures.
Security is jurisdiction-specific. The initial package should identify the proposed assets without assuming that every form of security is available or enforceable.
7. Project and transaction documents
For developments and infrastructure, include permits, technical studies, construction contracts, budgets, programmes, operating agreements, customer or offtake contracts and key professional reports. For an acquisition or refinancing, include the transaction structure, target information and existing facility documents.
A document list should mark each item as available, in progress or not applicable.
8. Compliance and jurisdiction map
Identify every material jurisdiction, counterparty and payment flow. Disclose sanctions exposure, litigation, regulatory issues or other matters that could affect onboarding or execution.
Early transparency is more useful than discovering a material issue after commercial work has begun.
What a strong submission achieves
A complete initial package does not guarantee financing. It allows the lender to decide whether the opportunity fits its mandate, identify the central risks and determine what further diligence is proportionate.
EIB’s project cycle similarly begins with proposal and appraisal before approval, documentation, disbursement and monitoring. The exact process varies by lender and transaction, but preparation reduces avoidable delay.
Credit HK reviews private-debt opportunities for incorporated corporate borrowers and sponsors. Initial submissions should focus on the essentials; additional diligence follows only where the opportunity is within mandate.
Review Credit HK’s private-debt approach or present a financing opportunity.
Sources and further reading
- private debt
- financing checklist
- borrower readiness
- credit underwriting