Seattle parent company RIA takes $ 3.3 billion PPP loan

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The parent company of Coldstream Wealth Management in the Seattle area accepted a loan from the government-backed Paycheck Protection Program (PPP), the RIA revealed in a recent Securities and Exchange Commission (SEC) file. ).

In a May 13 update to Form ADV, Coldstream Wealth Management (CWM), which manages around $ 3.26 billion, said Coldstream Holdings Inc. (CHI) applied for the loan in early April and received it. April 20. The company did not disclose how much money it received through the loan.

The existence of the loan was not previously reported. Coldstream Wealth Management did not respond to a request for comment, but offered an explanation in its dossier.

“As the COVID-19 pandemic hit the United States in March-April 2020, it presented many risks: unprecedented volatility in financial markets, volatility in the overall operating revenues of Coldstream Holdings Inc., including fee income based on CWM’s assets, potential health risks of unknown severity to key personnel and / or a large number of employees and clients, overall operational capacity and ability to adapt to work from home and / or staff shortages, forecasts of a severe global recession and other risks and uncertainties, ”Coldstream Wealth Management said in its ADV. “Faced with these unknown and ever-changing factors, with varying levels of impact on its underlying affiliate businesses, management of Coldstream Holdings, Inc. requested a PPP loan in early April and the loan funded on April 20, 2020.

“CHI management will continue to monitor the environment and macroeconomic risks, as well as any potential impact on the business of Coldstream Wealth Management, and will make decisions based on the information available to them at that time. “

In addition to Coldstream Wealth Management, CHI supports a broker, Coldstream Securities and a pair of insurers – Fit Insurers and Coldstream Holdings Inc. Life Insurance.

PPP loans are government guaranteed loans issued under the auspices of the Small Business Administration that aim to encourage employers affected by the coronavirus pandemic to keep their employees on their payrolls instead of firing them. Small businesses can take out loans through the program up to 2.5 times their monthly payroll or $ 10 million, whichever is less.

A company that takes out a PPP loan must certify that the financing is “necessary to support the applicant’s ongoing operations”.

The SBA may cancel up to 100% of loan proceeds used for payroll, rent, mortgages, and utilities if the borrower does not lay off a full-time employee within eight weeks of loan funding and upon completion of the loan. minus 75% of the amount remitted is used to cover the payroll.

Several large RIAs took out the loans during the pandemic, including $ 12 billion Carson Group, $ 1.2 billion Robertson Stephens, $ 4.9 billion RegentAtlantic and $ 1.96 billion Wealth Consulting Group.

Based in Bellevue, Washington, Coldstream Wealth Management has four offices in the Pacific Northwest. The company specializes in advising institutions and high net worth individuals and has a minimum account of $ 2 million for private portfolio management.

Coldstream Wealth Management is led by managing shareholder Kevin Fitzwilson, a former varsity basketball player at the University of Santa Clara. Three-time NBA All-Star Detlef Schrempf (pictured), who spent six seasons playing for the Seattle SuperSonics in the 1990s, is the company’s director of business development.

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