Boston, MA, August 1, 2006 - NewStar Financial, Inc. ("NewStar"), a Boston-based specialty finance company, announces that it has provided a five-year $10 million subordinated loan to a commercial loan-backed warehouse facility for Oak Street Funding, LLC ("OSF"). The facility was structured jointly with DZ Bank AG Deutsche Zentral-Genossenschaftsbank ("DZ Bank"), with Autobahn Funding, LLC as the senior conduit lender.
The transaction positions Oak Street Funding to expand and accelerate its commission-based lending services to financial service professionals throughout the United States.
OSF, based on Carmel, IN, provides capital to insurance agencies for succession planning, mergers, acquisitions and working capital. "Financial services professionals have demonstrated a tremendous appetite for this type of financing. Insurance agencies in particular represent an industry segment that has been historically underserved by commercial banks and thus often limited in their growth potential," said Richard S. Dennen, President and CEO of OSF.
"Oak Street's management team was looking for capital to satisfy market demand for commission-based lending solutions without compromising the integrity of the transaction," said Thomas M. Calhoun of NewStar. "We worked with their management team to meet their needs and look forward to working with them again in the future."
The concept for Oak Street Funding is based on the realization that commercial banks are often reluctant to loan against intangible assets such as insurance policies. Oak Street Funding uses a proprietary technology that evaluates the different risk aspects of lending and ultimately delivers the capital insurance agencies need to grow their business.
Joining Calhoun on the transaction deal team were Robert Clemmens, Mark Douglass, Robert Buzdon, Nicholas Edmonds, Ankush Kumar, and Cyrus Zahedi.
About NewStar Financial, Inc.:
NewStar Financial, Inc. was formed in June 2004 by a group of senior banking and capital markets executives from leading financial institutions, including FleetBoston Financial, Citigroup and JP Morgan Chase, and leading institutional investors including Capital Z Partners, JP Morgan Corsair Capital Partners and Och-Ziff Capital Management Group. NewStar is focused exclusively on providing customized financing solutions to mid-sized borrowers in three lending groups: Middle Market Corporate, Commercial Real Estate, and Structured Products. For more information, please contact the appropriate individual below.
Gaffney Bennett Public Relations