In the world of securitisation, the decision between on and off-balance sheet isn’t technical, it’s centred around strategic objective.
At Gilderstone, we’ve deliberately chosen an off-balance sheet securitisation platform in Luxembourg to issue Actively Managed Certificates (AMCs) and here’s the main reasons why:
- Credit risk is properly isolated. By housing assets in a bankruptcy-remote vehicle, risk is ring-fenced from the core business. Investors therefore take exposure to the underlying strategy and not the corporate balance sheet.
- Capital efficiency. An off-balance sheet model avoids tying up significant regulatory capital, allowing us to scale strategies and deploy resources where they generate the most value. It sidesteps all the constraints that an on-balance approach often struggles with.
- Funding flexibility and control. Through securitisation, we can tailor issuances across investor risk appetites, match asset and liability profiles, and diversify funding sources beyond traditional channels.
- Investor alignment. The structure provides transparency, defined risk tranching, and strong legal protections, key ingredients for institutional confidence.
- Scalability and time to market. New strategies and issuances can be added without balance sheet constraints, creating a modular platform designed for growth. Freed from the internal bureaucracy typical of on-balance sheet approaches, we can execute the issuance process with greater agility.
On-balance sheet structures still have their place but for a dynamic, multi-strategy AMC platform, they introduce limitations on capital, flexibility, and scale.
Off-balance sheet isn’t just a structuring choice for Gilderstone, it’s a strategic advantage.