Sectors

Banking & financing

For the risk committee that needs to know what the industrial asset base is worth before accepting it as collateral. Two figures (market and orderly liquidation), ready to approve the deal.

If you sit on a bank's risk committee, the question is always the same: what is this industrial asset base really worth before we accept it as collateral? You need two defensible figures and documentation you can approve without going back for more.

The Asset-Based Lending (ABL) and Sale & Leaseback operations your committee approves are built on the real value of the collateral — not on book value. The gap between the two can be substantial: equipment fully depreciated in the books can retain significant market value, and recent machinery can have suffered accelerated technical obsolescence. Independent valuation closes that gap and gives the committee a figure it can lend against.

At Capital Appraisal we issue reports with the dual calculation a risk committee needs: Fair Market Value (FMV) for the loan amount and Orderly Liquidation Value (OLV) for the recovery scenario. All of it under RICS Red Book standards, with full methodological traceability and a qualified digital signature — the format Spanish corporate banking accepts directly, with no additional documentation.

We work with banks and leasing companies on structured financing, with finance departments on Sale & Leaseback operations involving logistics warehouses or production lines, and with alternative credit funds on collateralised operations. We provide periodic updates of the collateral value to keep LTV ratios live without the need for full re-valuations.

Related sectors Private Equity & M&ARestructuring & insolvency

Structure of the operation

How an ABL financing or a Sale & Leaseback is articulated

The operation is built in five phases. Capital Appraisal intervenes in phases 2, 3 and 5 — the bank or the industrial real estate investor leads the rest. The usual timeline runs from 4 to 10 weeks depending on the volume of collateral.

  1. Preliminary term sheet

    The bank's risk committee defines an indicative LTV based on the client's book value. Usually 50-70% on depreciated assets. This figure is provisional and is conditional on the external valuation.

  2. Independent valuation of the collateral

    On-site inspection of machinery, vehicles and warehouses, structured technical capture with App Valoradores, modelling under RICS Red Book. Deliverable: a report with FMV and OLV separated by asset, a photographic technical record and methodological traceability. Timeframe: 5-15 days depending on volume.

  3. Setting the definitive LTV and approval

    The risk committee receives the RICS report and sets the final LTV. Most Spanish corporate banks apply 50-65% on OLV and 65-75% on FMV. Some alternative credit funds can go up to 80% of OLV on highly liquid collateral (standard fleets, CNC machinery).

  4. Signing, registration and drawdown

    For ABL: a financing contract with a pledge over the collateral, registration in the RBM (Movable Assets Registry) where applicable, drawdown of the loan. For SLB: a contract for the sale of the industrial property + a long-term lease contract (typically 10-15 years with renewal options), registration in the Land Registry.

  5. Periodic updates of the collateral value

    The LTV is kept live throughout the life of the loan. Half-yearly desktop reviews (with no re-inspection, based on secondary market data via Asset Studio) adjust the collateral value and keep the ratios within the agreed covenant.

Sector metrics

Indicative figures for the Spanish market

Typical ranges observed in industrial ABL and SLB operations in Spain (2022-2025). Each operation is calibrated to its specific risk profile.

Typical ABL LTV · industrial machinery
50-65%
Typical ABL LTV · vehicles
60-75%
Typical SLB LTV · warehouses
70-85%
Spread over Euribor · ABL
250-500 bps
ABL financing term
3-7 years
SLB lease term
10-15 years
Valuation delivery time
5-15 d
Recommended LTV review
Half-yearly
Regulatory framework

Regulation applicable to ABL and SLB operations

RICS Red Book
The methodological framework required by Spanish and European corporate banking for the valuation of collateral. It defines the bases (Market Value, FMV, OLV) and the applicable approaches. Capital Appraisal operates as a firm regulated by RICS under the Valuer Registration Scheme.
CRR / EBA Guidelines
The Capital Requirements Regulation (575/2013) and the Guidelines on Loan Origination and Monitoring (EBA/GL/2020/06) govern how European banks may recognise industrial collateral to reduce the regulatory cost of the loan. They require independent valuation and periodic review.
Bank of Spain · Circular 4/2017
The accounting framework for Spanish credit institutions. It defines how industrial collateral is recognised on the bank's balance sheet and the requirements for reviewing value — an annual minimum, half-yearly recommended for non-real-estate collateral.
IFRS 16 · Leases
Applicable to the selling client in a Sale & Leaseback: the leaseback is accounted for as a right-of-use asset + a lease liability on the balance sheet. Capital Appraisal quantifies this impact in the operation proposal.
RBM · Movable Assets Registry
The Spanish registry where pledges over machinery, vehicles and other movable assets attached to financing are recorded. The valuation of the asset is a direct input for quantifying the registered security.
Representative examples

Three anonymised scenarios

Real cases of completed operations (aggregated/anonymised data — the figure, the timeframe and the purpose are verifiable under audit; the client's identity is protected by NDA).

Type of operation Sector Collateral LTV Delivery time Outcome
ABL · collateralised refi Metallurgy €42M 62% 12 d Committee approval 2 weeks after the report
SLB · logistics warehouse Food & beverage €18M 78% 8 d Closed in 6 weeks · 12-year lease
ABL · plant machinery Pharmaceutical €11M 55% 5 d Urgent · signed 10 days after the engagement

Figures rounded. Delivery time = signed report from inspection. The final LTV is set by the bank's risk committee on the basis of the report.

Key benefits

  • Precise calculation of the collateral to set the LTV (loan-to-value · loan-to-value ratio)
  • Documentation that the bank's risk committee accepts without requesting additional information
  • Two figures in the report: market value (FMV) for the loan and orderly liquidation value (OLV) for the recovery scenario
  • Periodic update of collateral value throughout the life of the loan
  • Speed in the financial approval timeline — most operations close in 4-10 weeks

Who it is for

Banks and financial institutions
Leasing companies and alternative lenders
Industrial companies seeking financing
Corporate risk committees

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Need to know the real value of your assets?

Request your valuation. First contact, scope and fees with no obligation, under the RICS Red Book standard.

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No obligation · RICS-regulated firm · European coverage