Deutsche Bank, Morgan Stanley, U.S. Bancorp and Wells Fargo have joined founding investors Bank of America, Citi and J.P. Morgan in a $40m equity round in Versana, a digital data and technology platform.
These major institutions have invested capital, intend to contribute loan data and will become key clients of the platform.
Mike Weir, US Head of Loan Trading at Deutsche Bank: “The innovation that Versana is bringing to market is exactly what’s needed to increase velocity and spur growth for the entire industry. We are glad to join our peers in this effort to propel the market forward.”
This milestone transaction further propels Versana’s mission to bring long-awaited modernization to the syndicated loan market.
Versana was created to address the operational inefficiencies and technological fragmentation in the U.S. leveraged loan market.
The Versana platform, which launched late last year, is the market’s first real-time, multi-tenant solution centralizing corporate loan data flowing directly from administrative agents’ books and records.
By providing greater transparency into loan level details and lender portfolio positions, Versana facilitates straight-through processing and long-term, scalable market growth, enabling participants to convert from legacy manual processes to a state-of-the art, self-service platform that lays the foundation for future innovation.
“We’re thrilled to welcome our new investor banks to Versana and appreciate the tremendous value they will bring to our platform,” said Versana’s Founding CEO Cynthia E. Sachs.
“We now have seven of the top 10 major U.S. agent banks committed to our game-changing digital data platform, further validating our scalability and mission to modernize the loan market.”
The addition of three more administrative agents – Deustche Bank, Morgan Stanley and Wells Fargo – is expected to increase Versana’s future deal coverage for all market participants.
Sachs continued: “Converting from analog to real-time digital processes through a transparent and centralized platform will greatly improve data quality and streamline system fragmentation. With the addition of our four new investors, we expect to have more than 75% of U.S. loan market deals on our platform in real-time, an enormous achievement considering we launched the company only one year ago.”
As a leading trustee, particularly for CLOs which comprise 70% of the institutional loan market, U.S. Bancorp is Versana’s first buyside-focused investor who will assist in creating the network effect with the asset management community to accelerate product adoption.
John Stern, President, U.S. Bank Global Corporate Trust and Custody, added: “U.S. Bank is proud to be the first trustee on the platform, given the critical function we provide within the loan lifecycle. We are excited to be an early adopter and collaborator with so many other leaders in this market.”
The $5 trillion syndicated loan market is poised for significant growth, particularly during inflationary times when interest rates rise and market participants turn to floating rate financial products.
But the highly manual, fragmented and inefficient nature of the current market ecosystem – settlement times average more than 20 days – results in frustration among participants, significant additional costs and a high level of operational challenges.
Versana’s mission is to change all that, transforming the industry to foster an inclusive market structure that connects participants as never before, ultimately creating a healthier environment to serve clients better and draw in unprecedented amounts of new capital.
John Gregory, Head of Leveraged Syndicate, Wells Fargo’s Corporate & Investment Bank: “We are happy to join our industry peers in standing-up a platform, Versana, that aims to digitally transform and make more efficient the syndicated leveraged loan market to the benefit of all market participants.”
