Safeguarding your investment
Based on high value assets
Our art clients’ collections are of high value, and the market value is still yielding 10% or more per year. Our clients do not want to sell their art work, they want to keep the yield, but they also would like an income based on the value without selling their collection. This can be done by underpinning our bond and taking the risk away from the bond holders of OMNIA Bonds II plc against receiving a fee for taking that risk.
Also, our clients, such as charities, foundations and museums, which do not want to sell the art can start to earn an income against their art works´value to offset expenses of upkeeping, insurance and general operating expenses without selling off their collections.
Assets accepted are generally found in the Knight Frank Luxury Investment Index (KFLII) and consist mainly of fine art, but also classic car collections, investment grade diamonds and wine.
VALUATION OF THE ART
It is often difficult to estimate an accurate value of fine art. In order to get the most accurate valuation, we use several recognised appraisers and use an average of those valuations together with the sales history of the art and/or if possible, the sales history of comparable art. Thereby, we do not only rely on the valuation itself, but we also validate the valuation against the market price.
We work closely with our fine art insurance partners to appoint independent appraisers to carry out the valuations. All third parties are highly regarded within their field of expertise.
In order to ensure efficiency and acceptance between all our parties involved, our insurance partner makes sure that we always use the most experienced appraisers whose reputation is recognised within the industry.
KEY REASONS FOR USING PASSION INVESTMENT ASSETS FROM KFLII AS COLLATERAL
- Fine art and classic cars have been the highest yielding alternative asset classes ever with classic cars yielding 490% over the last ten years providing the strongest collateral to date
- The collateral can be moved anywhere in the world where the market for that specific art piece or car serves the best audience
- The collateral can be sold in any currency where the highest yield is to be achieved
- The asset pool is highly diversified
- The asset class has increased past the financial crisis and is more resistant to market volatility than other asset classes including real estate
- With the expected 41% increase in UHNWI, the demand for passion investments will keep raising together with the value of the collateral
- There is a well-established market for loans against these kinds of assets making the procedure of due diligence, storage, authentication, insurance and valuation well known, tested and proven
- With a 50-75% loan-to-value against the assets, any market volatility and shift in what is in popular demand can be eliminated as much as possible
- By having no competition that offers clients with collections of passion investments the possibility to earn an income against their assets, we have a low cost towards asset owners for securing our bonds