Business Model - Newpoint Capital & Guarantee

Newpoint Capital & Guarantee Ltd’s (NPC&G) business model is based on the core proposition of selectively providing Commercial Indemnities & Guarantees. It has a particular focus on the Trade Finance & Structured Products Sector, applied across multiple industries but with a particular focus on Continental Europe & Africa and thereinafter Asia.

The business was formed to focus as an enabler of commercial transactions through the provision of Indemnities & Guarantees between counter parties. NPC&G acts as Principal in the provision of commercial terms, (see further summary of our “Core Product Sets”). We are not regulated but use our regulated and approved Partners & Associates, to facilitate specialist support where required.

The underlying strength of NPC&G is growing its’ capital base, through retaining its income and making long term investments.

As part of the provision of Commercial Indemnities & Guarantees a fee is paid for the risk taken, collateral is provided by the party being guaranteed in the unlikely event of a call on the obligation provided, and the collateral provided to NPC&G is for an amount of at least the same value of the sum guaranteed.

The solution may incorporate an Alternate Risk Transfer (ART) component as part of the Commercial Indemnities & Guarantees, depending on the constraints and challenges presented in delivering the financial obligation.

NPC&G’s financial approach is to hold cash and securities in order to demonstrate its financial strength and stability. This is critical to attract opportunities and retain financial credibility in bidding for or creating Commercial Indemnities & Guarantees solutions to our target client base.

The management of risk is fundamental to NPC&G’s Business Model. The principal protagonists of NPC&G are well versed and experienced in risk (i.e. identifying, managing and mitigating risk), and have proven track records in the field. Furthermore, even though NPC&G is not regulated, it acts as if it is, and operates within similar constraints in respect of risk framework, capital allocation and corporate governance.

However, the point about risk management in this specific context concerns the recognition and importance of NPC&G’s relationship with its financial partners, namely banks and investment or fund managers. We seek to collateralise the risk taken by NPC&G in providing Commercial Indemnities & Guarantees as Principal. As a result, in the event we are called upon to satisfy the obligation owed we hold sufficient funds to meet our liability agreed commercially.