Honeycomb Investment Trust Plc (LON:HONY)

Founded in 2015, Honeycomb Investment Trust Plc is a UK-based closed-ended investment trust that focuses its investments primarily in UK’s credit assets originated by non-bank lending platforms and other originators of specialist lending assets. To enhance its return it invests on high-quality underwriting of borrowers in markets that are inadequately served by mainstream finance providers.  The objective of the company and its subsidiaries deliver an attractive level of dividend income with capital growth, mainly through selected equity investments and lending to non-bank lenders. Its investment assets include Property Loans, Royalty Finance, Bonds, Secured Consumer, Unsecured consumer, SME CBILS, Training Loans, Discounted fee receivables and commercial mortgages. The company’s shares are listed on the London Stock Exchange as LON: HONY.

The company has appointed Pollen Street Capital Limited as its investment manager, which is responsible for the discretionary management of portfolio. The company’s loans to counterparties benefits from two forms of protections that include it has security over the underlying loan portfolios for many deals, which means in case of any shortfall on loans it has right to realise the collateral and it have seniority over equity holders and other creditors, which mean from any underperformance other counterparties suffer the first loss. Typically, loans are of short duration, with an average life of 2 to 3 years and an amortising profit that withdraws refinancing and exit risk. The company’s portfolio is composed of two types of deals that include structured loan, which are lender to non-bank lenders and are secured on their underlying loan portfolio and Direct Portfolios, which are the portfolio of loans owned directly by the company.