Structured Finance

About Us

Strategic Corporate Services Ltd is a leading independent Vanuatu professional services firm offering a comprehensive array of services to both corporate and private clients. Central to our range of services, is providing impartial guidance and solutions uniquely customised to meet the diverse funding needs of clients, spanning property purchase and development, both onshore and offshore, project development to advance business interests, and financing for yachts and aircraft, including by way of direct and/or novated leases.*

With years of experience navigating the intricate landscape of international finance and legal frameworks, we’re able to provide tailored solutions that meet the unique needs of our clients. From establishing robust trust and corporate structures to ongoing management and compliance, we ensure peace of mind and financial security for individuals, families, businesses, and organisations worldwide.*

Our in-house legal counsel oversees all communications, ensuring clients benefit from legal professional privilege and confidentiality in all their interactions and arrangements.

The Benefits of Offshore Structured Finance

The benefit of offshore structured finance lies in its ability to provide flexible and efficient financing solutions while leveraging the advantages offered by offshore jurisdictions. Here are some key benefits:

• Tax efficiency: Offshore structured finance often allows for tax optimisation strategies, such as reduced tax rates, tax exemptions, or tax deferral, which can lead to significant cost savings for investors and borrowers.
• Asset protection: Offshore jurisdictions typically offer strong asset protection laws and confidentiality provisions, providing a secure environment for structuring financial transactions and safeguarding assets from potential legal or regulatory risks.
• Diversification: Offshore structured finance enables investors to diversify their investment portfolios across different jurisdictions and asset classes, reducing concentration risk and enhancing overall portfolio resilience.
• Regulatory flexibility: Offshore jurisdictions may have less stringent regulatory requirements compared to onshore jurisdictions, allowing for greater flexibility in structuring financial transactions and reducing regulatory burdens for market participants.
• Privacy and confidentiality: Offshore structured finance transactions often benefit from enhanced privacy and confidentiality provisions, protecting the identities of investors and borrowers and maintaining confidentiality of sensitive financial information.
• Access to global markets: Offshore structured finance facilitates access to global capital markets and a broader range of investment opportunities, enabling investors and borrowers to tap into international funding sources and expand their business operations globally.

Vanuatu stands out as a modern and facilitative jurisdiction, dedicated to empowering entrepreneurs to achieve their goals. With its progressive legal framework and tailored legislation, based on English law, Vanuatu offers a conducive environment for offshore structured finance. This jurisdictional advantage, coupled with these benefits makes Vanuatu an attractive destination for sophisticated investors and corporate entities seeking tailored financing solutions.

Exploring Non-Traditional Structured Finance: Innovative Solutions for Modern Challenges

Non-traditional structured finance refers to financial arrangements that deviate from conventional or traditional methods of structuring financial transactions. While traditional structured finance typically involves assets like mortgages, loans, and bonds, non-traditional structured finance goes further venturing into more unconventional territory. This can include:

• Hybrid finance solutions: Blending traditional and innovative financing methods to tailor unique strategies for diverse financial needs. These approaches offer flexibility, efficiency, and tailored solutions, enabling access to capital and risk management in non-traditional ways.
• Alternative collateral: Using alternative collateral to secure funding offers a broader range of benefits compared to non-traditional collateral methods. It allows for greater flexibility in asset selection, potentially unlocking financing opportunities that may not be accessible through conventional means. Additionally, alternative collateral can provide better risk mitigation by diversifying the asset base and reducing reliance on traditional forms of security. This approach offers innovative solutions to meet evolving financing needs while enhancing overall portfolio resilience.
  + Non-traditional structured finance may involve the use of alternative assets such as intellectual property rights, royalties, or future cash flows (incl’ Crypto) from specific revenue-generating activities.
• Specialised industries: Such may focus on financing arrangements tailored to specific industries or sectors that require unique funding solutions, such as healthcare and medicinal research and development, renewable energy, and technology startups.
• Complex derivatives: Non-traditional structured finance can also encompass complex derivative instruments or financial products -including Crypto currency and Digital assets- that are customised to meet the specific risk management or investment objectives of borrowers and lenders, alike.
• Hybrid structures: Which may involve the creation of hybrid financial structures that combine elements of traditional debt financing with equity participation or other forms of contingent -though enforcable- payment arrangements.
• Note: Our firm also works with most major currencies including: USD$, EUR €, JPY ¥ / 円, GBP £, CNY ¥ / 元, AUD A$, CAD C$, CHF, HKD HK$, SGD S$, SEK kr, KRW ₩ / 원, NOK kr, NZD NZ$, INR ₹, MXN $, TWD NT$, ZAR R, BRL R$, DKK kr, PLN zł, THB ฿, ILS ₪, IDR Rp, CZK Kč, AED د.إ, TRY ₺, HUF Ft, CLP$, SAR ﷼, PHP ₱, MYR RM, COL$, RUB ₽ – as well as most major Crypto-currencies.

Overall, non-traditional structured finance offers innovative solutions to meet the evolving needs of market participants and address challenges that may not be adequately addressed by conventional financing methods.

Unlocking Opportunities: Benefits of Syndicated Loans from Private Lenders

A ‘syndicated loan’ provided by private and/or specialised institutional lenders offers several advantages from both perspectives of streamlined processes and entrepreneurial understanding. Unlike traditional lenders, private lenders typically operate with less red tape, allowing for quicker decision-making and funding processes.

Moreover, private and specialised institutional lenders often possess a deeper understanding of entrepreneurial ventures and are more willing to engage in flexible financing arrangements tailored to the unique needs of the borrower. This can include establishing beneficial partnerships in current and ongoing projects, where private lenders may take on a more active role and provide valuable expertise or resources to ensure project success.

A key feature of private lenders is their personal interest in seeing the project succeed, often leading them to take on de facto partnerships in ‘debt-for-equity’ financing arrangements, which is one of the fastest-growing areas of structured finance practice.

Benefits of Debt-for-Equity Loans: Restructuring Debt and Sharing Risks

This conversion of debt into equity can provide several benefits for both the borrower and the lender:

• Debt reduction: By converting debt into equity, the borrower can reduce its overall debt burden, improving its financial leverage and debt-to-equity ratio.
• Equity infusion: The conversion of debt into equity provides the borrower with additional equity capital, which can be used to strengthen the company’s balance sheet, fund growth initiatives, or meet other capital requirements.
• Risk sharing: For the lender, converting debt into equity allows them to share in the company’s future performance and potential upside, aligning their interests more closely with those of the borrower.

Overall, debt-for-equity loans offer a mechanism for companies to restructure their debt obligations and strengthen their financial position, while providing lenders with an opportunity to participate in the long-term success of the borrower.

Note: Debt-for-equity loans can occasionally draw scrutiny from tax regulators, who may scrutinise them for potential tax implications, particularly concerning the treatment of income provisions. This scrutiny often centers on the structure of the loan agreement, particularly whether it reflects the implicit nature of an arms-length transaction between the borrower and the lender.*

While establishing a company in Vanuatu can be a prudent strategy for financing commercial projects or holding assets, such as yachts or aircraft, the versatility and advantages of trust structured asset ownership ought be considered. Trusts, in combination with a corporate entity offer a dynamic and flexible approach to asset management, operating across multiple jurisdictions and benefiting from the most advantageous legal frameworks. As they say, the devil is in the detail, thus crafting a Trust Deed with clear and unambiguous intentions and protections is paramount to avoiding legal disputes down the line.