Capital Commitment Guarantees | Secure Your Funding Obligations with Tier-1 Bank Backing
🔹 LP Capital Assurance | SPV Funding Triggers | ICC-Compliant Enforcement
⚠️ Facing Default Risks on Investor Commitments?
A €850M European real estate fund nearly collapsed when 3 LPs failed to meet capital calls during market volatility. Our Capital Commitment Guarantee provided:
✅ 100% Call Coverage for GP through AA-rated bank consortium
✅ Penalty Recovery Mechanism for missed contributions
✅ Portfolio Preservation with 72-hour liquidity access
« NNRV’s guarantee transformed our fund’s credibility. We closed €1.2B in new commitments within 3 months of securing their solution. »
– Managing Partner, Private Equity Firm, Luxembourg
💼 What Are Capital Commitment Guarantees?
Legally binding instruments ensuring limited partners (LPs) meet funding obligations:
▪ Coverage for Capital Calls (Up to 100% of committed amount)
▪ Step-In Funding (Automatic activation upon LP default)
▪ Cross-Fund Protection (Multi-SPV coverage structures)
Governed By:
✔ LMA/APLMA Standards
✔ ISDA 2021 Commitment Protocols
✔ AIFMD Article 34 Compliance
✅ Key Features
| Structure | Investor Benefit |
|---|---|
| Tiered Trigger System | Graduated response to payment delays |
| Portable Coverage | Transferable between parallel funds |
| FX Hedge Integration | Multi-currency call protection (18 pairs) |
| Co-Investment Matching | Attract anchor investors via secured slots |
🏦 Approved Issuing Banks
| Institution | Specialization | Min. Commitment | Tenor |
|---|---|---|---|
| Goldman Sachs PIA | Mega-Fund Coverage (>$500M) | $100M | 5-12 years |
| UBS Capital Assurance | Venture Capital/SPACs | €50M | 3-7 years |
| JP Morgan Fund Shield | Real Estate Debt Funds | £75M | 5-10 years |
| Credit Suisse ALM Solutions | PE Secondaries/Continuation Funds | $200M | 7-15 years |
(🌐 Sovereign wealth fund wrappers available for infrastructure mandates)
📋 Documentation Requirements
✔ LPA Excerpts (Capital call provisions)
✔ LP KYC/AML Dossiers (Including beneficial ownership)
✔ Fund Financial Model (Stress-tested scenarios)
✔ GP Track Record (Previous fund performance)
✔ Side Letter Disclosures
🔄 5-Stage Execution
LP Vetting – Deep dive on 20+ credibility metrics
Structure Design – Custom triggers (NAV-based, time-based)
Bank Syndication – Matching with specialist providers
Dry Run Testing – Simulated default scenarios
SWIFT Activation – MT799 pre-advice + MT760 issuance
📊 Protection Comparison
| Instrument | Call Coverage | Enforceability | Cost Efficiency |
|---|---|---|---|
| Capital Commitment Guarantee | ⭐⭐⭐⭐⭐ | ⭐⭐⭐⭐⭐ | ⭐⭐⭐⭐ |
| LP Letter of Credit | ⭐⭐⭐ | ⭐⭐⭐ | ⭐⭐ |
| Escrow Accounts | ⭐⭐ | ⭐⭐⭐⭐ | ⭐ |
🚀 Why NNRV?
✔ Black Book Database – 1,200+ pre-vetted LP profiles
✔ LMA-Compliant Templates – Court-tested enforcement language
✔ Velocity Funding – 96-hour emergency capital access
✔ GP Insurance Bridge – Seamless integration with D&O policies
📌 Key Parameters
Minimum Commitment: €25M (€10M for emerging managers)
Coverage Ratios: 70-100% (sliding scale based on LP credit)
Pricing: 35-150 bps (dependent on fund strategy and LP pool)
🌍 Deal Evidence
« Secured €300M in new institutional capital after implementing NNRV’s guarantee framework. » – Infrastructure Fund, Madrid
« Recovered 92% of defaulted commitments within 14 days during COVID disruptions. » – Venture Fund, Singapore
📞 Secure Your Fund’s Backstop
[📥 Download GP Assurance Kit]
[🏛 Schedule Capital Call Stress Test]
🏆 Endorsed By:
▪ ILPA Best Practices Guidelines
▪ EMPEA Standards Committee
▪ BVCA Capital Markets Group