Asset-based Lending at Arvest Bank

Asset-based lending (ABL) at Arvest Bank provides flexible, collateral-backed financing designed to help growing companies manage working capital, pursue strategic opportunities, and stabilize cash flow. Tailored for businesses whose value is tied to tangible assets — such as accounts receivable, inventory, equipment, and real estate — Arvest’s ABL solutions deliver scalable credit capacity with underwriting that focuses on the quality and liquidity of pledged assets.

Who benefits from ABL?

Asset-based lending is ideal for middle-market companies, seasonal businesses, manufacturers, distributors, wholesalers, and service providers that need consistent access to capital but may not fit the profile for traditional term loans or unsecured credit lines. Businesses experiencing rapid growth, supply chain fluctuations, or uneven receivable collections often find ABL an efficient way to convert assets into usable cash while preserving existing ownership and operational control.

Key features

• Collateral-first underwriting: Borrowing capacity is primarily determined by eligible collateral — accounts receivable, inventory, equipment, and certain real estate — rather than purely by cash flow projections.
• Flexible advance rates: Advance rates vary by asset type and quality, giving companies predictable access to working capital tied to actual balances and inventory levels.
• Revolving or term structures: ABL can be structured as a revolving line to support ongoing working capital needs, or combined with term financing for acquisitions, equipment purchases, or recapitalizations.
• Seasonal accommodation: Facilities can be sized and structured to account for seasonality, allowing capacity to ramp up and down with business cycles.
• Active portfolio management: Periodic collateral reviews, borrowing base calculations, and reporting mechanisms provide transparency and alignment between lender and borrower.

Types of collateral accepted

Arvest evaluates a range of asset classes when structuring an ABL facility. Common collateral types include:

• Accounts receivable: Trade receivables from creditworthy customers typically form the foundation of ABL facilities, with eligibility rules for aging, concentrations, and disputed balances.
• Inventory: Finished goods and certain raw materials that are marketable and can be accurately valued and monitored.
• Equipment: Machinery, vehicles, and production equipment that retain resale value and can be appraised.
• Commercial real estate: Owner-occupied or investment properties can supplement borrowing capacity in combination with other assets.

Typical uses of proceeds

Companies use ABL proceeds for a wide range of operational and strategic purposes: smoothing payroll and supplier payments, financing growth and inventory buildup, funding acquisitions, supporting turnarounds, or refinancing higher-cost debt. Because ABL is closely aligned with working capital needs, it is particularly effective for businesses that convert inventory and receivables into cash on a recurring basis.

Underwriting and documentation

Underwriting focuses on the valuation and quality of assets pledged as collateral. Key considerations include customer creditworthiness, concentration risk, inventory salability and obsolescence risk, equipment condition, and overall business stability. Documentation typically includes a secured loan agreement, a borrowing base schedule, UCC filings, and reporting covenants such as periodic accounts receivable aging, inventory reports, and financial statements. Arvest’s experienced lending teams work to streamline processes and tailor reporting requirements to the borrower’s capabilities.

Risk management and monitoring

Active monitoring is central to successful asset-based lending. Arvest employs periodic collateral audits, borrowing base calculations, and covenant monitoring to maintain alignment between loan capacity and the underlying asset values. This disciplined approach protects both borrower and lender, ensuring that available credit reflects current business conditions and that adjustments can be made proactively.

Advantages of choosing Arvest

• Regional expertise: Deep understanding of local markets and industries enables more relevant underwriting and relationship-driven credit decisions.
• Customized solutions: Flexible structures that adapt to seasonality, growth plans, and special situations rather than forcing a one-size-fits-all product.
• Responsive service: Dedicated relationship managers coordinate underwriting, reporting, and any necessary restructurings to support business continuity.
• Integrated banking services: Access to treasury management, commercial real estate lending, equipment finance, and deposit services facilitates cohesive financial management for the business.

What to expect during the application process

The process begins with an initial assessment of business needs and an overview of eligible collateral. Following an application, Arvest’s team conducts due diligence, including collateral appraisal, customer credit review, and financial analysis. Once terms are agreed, legal documentation and security filings are completed and reporting mechanisms are established. Timelines vary by complexity, but the process is managed to minimize disruption and provide clarity at each stage.

Common borrower profiles

Successful ABL borrowers typically include companies that have significant accounts receivable or inventory, predictable sales cycles, and management teams capable of maintaining accurate financial records and operational controls. Businesses undergoing rapid expansion, restructuring, or preparing for an acquisition also find ABL to be an effective bridge to long-term financing goals.

Transparent pricing and covenant structure

Pricing for ABL generally reflects credit profile, collateral quality, facility size, and complexity of monitoring. Covenant structures are tailored to the borrower’s operational reality and typically include borrowing base tests, eligible asset criteria, and periodic reporting. Arvest emphasizes clear, predictable terms so management teams can plan and act with confidence.

Final thoughts

Asset-based lending at Arvest Bank is a practical, flexible financing option for companies that convert assets into value and need a dynamic credit solution. By aligning borrowing capacity with collateral performance and combining regional market expertise with responsive service, Arvest helps businesses maintain liquidity, support growth, and navigate changing market conditions. For companies seeking a lending partner that understands asset-driven finance and delivers tailored, manageable credit facilities, Arvest’s ABL platform offers a balanced approach to capitalizing on business assets.

Address Bank: Bentonville, Arkansas
Bank: Arvest Bank
Headquarters: Bentonville, Arkansas
Products: Loans & Credit
Type: Asset-Based Lending