Onside Issue 6 - 32

Interest in Seneca

Tim Murphy joined Seneca in 2011
and as well as being a Director of
several Seneca businesses, including
Seneca Banking, he also sits on and
leads a number of Investment and
Credit Committees at Seneca.
Seneca Banking were the only company
specialising in claims for the mis-selling of complex
financial products to be invited to provide
evidence to the House of Commons Treasury
Select Committee hearing on SME lending and
Tim provided that evidence as a leading expert
in the space. Tim was a co-founder of Seneca
Banking who are one of the UK's leading advisers
in claims for complex financial products and
disputes and he has played a pivotal role in the
successful recovery of over £100 million in total
compensation for UK businesses. Seneca has
handled one of only a handful of contingent loss
claims in the whole of the FCA review scheme to
obtain an award over £1 million (Seneca achieved
a claim of £3.5 million) and have advised over
1,000 SMEs on complex financial products and
acted for over 400.
Tim commenced his finance career in 1983
with Barclays before joining the Royal Bank
of Scotland's fledgling Acquisition Finance
business. He was subsequently responsible for
all UK regional teams before in 2002, founding
RBS Corporate & Structured Finance. As Joint
Managing Director, he had overall responsibility
for the National Mid-Cap structured finance
business, whilst also being a member of the
Bank's Corporate Credit Committee. In 2005,
Tim was hired by Deloitte as a corporate finance
partner with the remit to establish the National
Debt Advisory business, advising on capital
raising and stressed debt refinancing.

The debt market
In most markets debt lines are increasingly
becoming commoditised. Credit scoring has
moved from the retail finance market into the
commercial and property lending world and
this trend will only continue. These moves are
designed to reduce the cost of delivery, which
when combined with a bank's low cost of capital,
results in them dominating their core markets
because of the resultant price advantage. The
downside is by commoditising debt, the purchaser
focuses on price and banks, try as they might, find
it extremely difficult to differentiate their offering
on anything other than price - the end game being
a race to the bottom and survival of the fittest, or
fattest balance sheet!
This pool of low cost debt which has been
enhanced by low base rates is obviously attractive
to the majority of commercial borrowers, but
with a commoditised offering, driven by credit
scoring, comes a lack of flexibility. Deals that don't
'tick the right boxes' are often discarded, or if not
automatically rejected. It can take an age for a 'real
person' to make a decision. By that time the deal
could have been lost or the borrower has lost the
will to live.
This move by banks towards commoditising debt
for SMEs with the associated lack of flexibility,
is what Seneca takes advantage of, by targeting
specific niche markets where speed of delivery
and non-standard structures are valued by the
borrower above price.



Table of Contents for the Digital Edition of Onside Issue 6

Contents
Onside Issue 6 - Cover1
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Onside Issue 6 - Contents
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