NewStar Financial Inc., an internally-managed commercial finance company, announced that it has formed a new financing subsidiary, NewStar Warehouse Funding I, which has entered into a $175 million revolving warehouse financing arrangement with Citibank, N.A.. The credit facility will be used to partially fund eligible loans originated by the company's Leveraged Finance group. The facility has a target advance rate of 70% and matures in May 2020. It is structured with a three-year revolving, reinvestment period and will amortize over the remaining two years. NewStar Financial will serve as originator and collateral manager. 

"We are very pleased to complete this important new financing with Citibank, which builds on a valued, longstanding relationship. This facility further diversifies our funding platform and provides additional lending capacity to support anticipated loan growth. With competitive pricing and advance rates, we expect to be able to earn attractive returns on the capital committed to this program as we originate new loan collateral prior to securitization in the CLO market," said John Frishkopf, NewStar's head of asset management and treasury.

NewStar Financial is an internally-managed commercial finance company focused on meeting the complex financing needs of companies and private investors in the middle markets.