What is ARTIANA Fine Art Finance?
Artiana Fine Art Finance is our art finance, advisory division. Leveraging upon the strength of our auction house platform, we specialize in financing solutions that cater to both – buyers in our auctions as well as others who can borrow against blue-chip Indian artworks.
What services does ARTIANA Fine Art Finance provide?
We provide finance solutions to consignors and buyers at our auctions and arrange advances secured against Indian fine art at competitive interest rates. Our bespoke finance solutions provide financing for fresh acquisitions or existing collections.
Why finance or borrow against art?
By financing their purchases at Artiana auctions, clients can take advantage of opportunity buys and schedule a delayed or installment payment on their acquisitions based on their cash flows. By leveraging existing artworks, our clients optimize the use and enjoyment of their collection, while unlocking equity and allowing further portfolio diversification.
What type of art does ARTIANA Fine Art Finance accept as collateral?
We will consider individual artworks and collections of blue-chip Indian fine art as collateral. Artworks must be freely marketable and produced by prominent artists with an existing track record in the secondary market.
What is the artwork evaluation process?
We are an auction house, and offer advisory services on a highly confidential basis to evaluate artworks. The individual artwork or collection will be estimated by us as if they are being proposed for auction, and the advance against this item / s will typically be 50% of the lower estimate value offered by us. We will also require an independent inspection by a conservator.
What Loan-To-Value (LTV) does ARTIANA Fine Art Finance offer against the artworks?
We will typically advance up to 80% of the lower estimate value of artworks purchased at our auctions or up to 60% of the appraised value of the proposed external art collateral.
What are the advance sizes that ARTIANA Fine Art Finance offer?
We arrange advances starting at USD 50,000 and can assist in securing advances of substantially larger amounts.
How long does the disbursal take?
The approval depends on the location of the artworks and the clients’ art ownership structure. However, our domain expertise and large, liquid balance sheets of our financiers allows us to complete the process more quickly than traditional operators.
Do our clients retain possession of their art?
No, we require that the artwork be held as collateral in our art storage facility till the advance has been fully paid back to our financier.
Will the artworks be insured during the term they are held as collateral in storage?
Throughout the term that the artworks are held as collateral, they will be insured at double of the advance amount, to cover the full value of the art asset. The policy will be assigned to us for distributing the amounts as stipulated, between the client and financier. The insurance covers the items right from the time of collection, during storage until the final handover.
Who owns the artworks during the term they are held as collateral in storage?
The artworks remain the clients’ property during the entire storage period.
What are the advantages of Artiana’s fine art finance compared to a traditional bank loan?
Our advances offer flexibility and variable tenors up to 24 months with a no-charge early exit option. Unlocking equity and receiving liquidity without cumbersome documentation and credit approval process. There is no personal liability, the collateralized artworks are the sole guarantee towards the advance (nonrecourse).
What are the early exit options before the expiry of the agreed tenor?
Clients can request an early exit before the expiry of the agreed tenor by giving a 30 days notice without any exit charges being payable. Any advance service charges collected in such cases will be non-refundable. For exercising in rare and unlikely situations, we reserve the right of an early exit option on behalf of our financiers by giving a 90 days notice to the client.
What are the charges and costs for the service and advance?
Artiana Fine Art Finance will charge an arrangement fee of 2% of the advance amounts arranged against external art assets, this fee is waived for finance arranged against purchases made in our auctions. Depending on the value, tenor and terms of the advance the charges are calculated at typically 15 % p.a., payable quarterly in advance for fixed maturity payments, and at a flat rate of 10 % p.a. for monthly installment payments. The charges are set at the start of the facility and fixed for the entire tenor. There are no additional costs for evaluation and storage, insurance cover is procured for double the advance amount to typically cover the full value of the asset and billed at actuals to the client.