Terminology comparison guide
Securities-Backed Lending: Which Terms Mean What?
Lombard credit, portfolio financing, securities-based lending, share financing, stock loans, and margin lending overlap—but they are not reliable synonyms. This guide maps common usage and the questions that reveal each structure's real legal and economic effect.
Start with the transaction, not the label
What is borrowed?
Cash, a revolving credit line, or securities for temporary delivery?
What supports it?
A diversified portfolio, one listed shareholding, real estate, or an unlisted business interest?
What can the provider do?
Request more collateral, sell assets, recall securities, or pursue a remaining deficiency?
Terminology comparison
| Term | Common meaning | Typical asset base | What to verify |
|---|---|---|---|
| Lombard credit / Lombard loan | Credit based on eligible marketable investments, commonly assessed as a portfolio | Diversified equities, bonds, or funds | Eligibility changes, concentration, currency, margin calls, recourse |
| Securities-based lending | Broad private-bank or wealth-finance term for cash borrowing using investments as collateral | Eligible investment account or portfolio | Purpose restrictions, maintenance, sale rights, full-recourse exposure |
| Portfolio financing | Broad descriptive category, not one standard legal product | A portfolio of financial assets | The underlying contract may be a line, term facility, or another structure |
| Investment-backed borrowing | Plain-language description rather than a precise product class | Eligible investments | Identify the actual contract, provider, custody, and enforcement model |
| Share pledge financing | Credit supported through a pledge over listed shares | One or more shareholdings | Pledge perfection, custody, voting, distributions, disclosure, enforcement |
| Single-stock financing | Financing focused on one listed issuer | A concentrated listed position | Issuer events, price volatility, market depth, ownership and dealing rules |
| Margin lending | Brokerage-linked credit commonly used for investing or trading | Approved account assets | Daily maintenance, floating costs, fast forced-sale mechanics |
| Stock loan | Ambiguous: may mean share-collateral cash financing or securities lending | Depends on usage | Confirm whether cash is borrowed or securities are borrowed |
| Share financing | Umbrella phrase that may refer to several listed-equity structures | Usually listed shares | Too broad to establish recourse, custody, purpose, or maintenance |
| Securities lending / stock borrowing | Temporary transfer of securities, often for short selling or settlement | The securities themselves are borrowed | Recall, collateral, manufactured payments, counterparty and settlement risk |
The crucial distinction: cash financing or securities borrowing?
Securities-based lending
The borrower receives cash or credit. Investments provide collateral value. The key mechanics are eligible assets, lending values, interest, margin calls, sale rights, purpose restrictions, and recourse.
Securities lending / stock borrowing
The borrower receives securities temporarily, often to make delivery following a short sale or to support settlement. The key mechanics are collateral, fees, recall, manufactured distributions, voting treatment, counterparty risk, and return of equivalent securities.
Because “stock loan” is used for both ideas, a search result or product name is not enough. Ask whether the transaction provides cash to a shareholder or lends stock to a market participant.
Categories that should not be collapsed together
Listed-equity financing
Uses quoted shares whose prices, trading volume, custody, and issuer events can be monitored. Concentrated positions require single-name analysis.
Private equity finance
Concerns interests in unlisted businesses. Valuation is periodic and bespoke, transfers may be restricted, and exit routes differ from public-market collateral.
Property equity loans
Rely on real estate value, title, valuation, and property enforcement processes. They are not a form of securities-based lending merely because both involve “equity”.
Share financing as a broad label
May refer to margin credit, a pledge, a stock loan, or direct equity-backed capital. The documents establish what it actually is.
Recourse and margin calls are contractual
None of these labels proves that a facility is non-recourse. A bank Lombard line or margin facility is often full recourse, while other structures may expressly limit remedies. Review deficiency claims, guarantees, collateral top-ups, cross-defaults, set-off, sale rights, and how proceeds are applied.
A margin call can follow a market decline, currency movement, concentration increase, eligibility change, or provider haircut. J.P. Morgan Private Bank's Asia-Pacific educational page explains that falling collateral value may require additional collateral or repayment and can lead to asset sales if a call is unmet. The Lombard loan guide covers these mechanics in more detail.
Asia-Pacific reading paths
Sources and editorial note
This comparison was checked with private-sector explanations from UBS Singapore and J.P. Morgan Private Bank Asia-Pacific. They are cited for terminology and risk context only; no affiliation or endorsement is stated or implied.
Squadron Capital's position
Squadron Capital deploys direct capital for equity-backed financing and does not provide bank loans. Its commercial facilities are non-recourse, with no personal or corporate guarantees required. The loan terminology on this page is educational and should not be used to relabel Squadron Capital's facility.
Learn about equity financingFrequently asked questions
Are securities-based lending and securities lending the same?
No. Securities-based lending provides cash while eligible investments serve as collateral. Securities lending transfers securities temporarily to a borrower, commonly for short selling or settlement, in return for collateral and a fee. One is a financing relationship; the other supports securities-market mechanics.
What does portfolio financing mean?
Portfolio financing is a broad descriptive term for liquidity based on the assessed value and risk of an investment portfolio. It may include Lombard credit, a securities-based line, or another collateralised facility. The phrase alone does not reveal whether the facility is revolving, recourse, or subject to daily maintenance.
Is share pledge financing always a Lombard loan?
No. Share pledge financing may involve one concentrated listed holding, while classic Lombard credit usually relies on a diversified pool of eligible financial assets. Local law, custody arrangements, enforcement rights, and the provider’s concentration policy can make the structures materially different.
What is single-stock financing?
Single-stock financing uses one listed shareholding as the principal collateral. Concentration, liquidity, volatility, trading volume, ownership disclosures, and dealing restrictions become especially important. It differs from diversified portfolio lending and should not be assumed to carry the same terms.
Are stock loans automatically non-recourse?
No. Stock loan is an ambiguous market term, and recourse depends on the contract. A facility may be full recourse, limited recourse, or non-recourse. Review the provider’s remedies and any top-up, guarantee, or deficiency obligations instead of inferring them from the product name.
How do listed-equity facilities differ from property equity loans and private equity finance?
Listed-equity financing is assessed using quoted securities, market liquidity, custody, and price monitoring. A property equity loan relies on real estate value and title. Private equity finance concerns ownership in unlisted businesses and usually depends on bespoke valuation and transfer restrictions. They are separate categories.
Published by the Squadron Capital editorial and research team. Last reviewed: 23 September 2026.