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Collateral value

Collateral value

Collateral value is the maximum value up to which an asset, such as a security, can be borrowed against.

What is collateral value?

Collateral value (Swedish: belåningsvärde) is the maximum value up to which an asset, such as property or a security, can be borrowed against. It is set as a proportion of market value, often lower for assets that are hard to sell or volatile.

 

Collateral value for unlisted shares

In a pledge of shares in an unlisted company, the lender needs a valuation and a clear ownership picture. An accurate share ledger in which the pledge is noted shows who owns the shares and that they are pledged.

Learn more about the digital share ledger
Henrik Kristensen, NVR
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Related terms

Pledge of shares

A pledge of shares means shares are provided as security for a debt, often a loan.

Valuation

A valuation is an estimate of what a company or a shareholding is worth.

Security

A security is a document or right that gives its holder value, usually one that can be converted into money.

Third-party protection (perfection)

Third-party protection means that a right to property, such as shares, also applies against third parties.