Rigorous Risk Management for Stable Returns
Ellerfield’s proactive approach to capital protection and portfolio governance
Risk Management Philosophy
At Ellerfield, risk management is embedded in every investment decision. We follow a proactive, exit-oriented approach to structuring loans, underpinned by:
- Comprehensive due diligence
- Continuous monitoring
- Strong portfolio governance
Our ultimate goal:
Protect investor capital while generating predictable, stable returns
Exit-Oriented Structuring
All loans are underwritten with a clear repayment strategy from the outset.
Key structuring principles include:
Defined exit plans based on presales, asset sales, or refinance
Verified borrower equity contributions
Registered first mortgages and enforceable security documentation
Personal or corporate guarantees where appropriate
Due Diligence Framework
We conduct rigorous due diligence prior to loan approval, including:
- Independent valuations and quantity surveyor reports
- Background checks on borrowers and directors
- Detailed financial analysis and sensitivity testing
- Legal reviews and conditions precedent vetting
- Third-party reports (environmental, planning, and feasibility where required)
Ongoing Monitoring & Reporting
Borrowers and projects are monitored monthly and annually to ensure compliance and early detection of risks. Monitoring includes:
Monthly Activities:
- Loan performance checks
- Covenant testing
- Site visits (for construction)
- PCG participation
Annual Reviews:
- Borrower reassessments
- Portfolio risk reweighting
Diversification & Exposure Limits
To protect against concentrated risk, Ellerfield enforces strict lending diversification rules:
- No single loan may exceed 30% of total Funds Under Management (FUM)
- No more than four loans may be issued to any one borrower group
- Geographic, sectoral, and project type allocations are reviewed annually by the Investment Committee