Specialty finance is gaining importance as manufacturers and middle-market businesses look for capital beyond conventional bank lending. Loeb Term Solutions has secured a $25 million senior secured revolving credit facility from Pinnacle Bank, giving the equipment finance company additional capacity to fund machinery and equipment loans for borrowers that may not qualify under traditional bank credit models.

For manufacturers, distributors and other businesses, access to capital can depend as much on the assets they own as on their balance sheets. That distinction is becoming increasingly important as companies invest in equipment while conventional credit standards remain selective.

Loeb Term Solutions, a specialty equipment finance company, has closed a $25 million senior secured revolving line of credit with Pinnacle Bank, a subsidiary of Pinnacle Financial Partners. The facility is designed to expand Loeb’s ability to originate equipment term loans, particularly for businesses that fall outside traditional bank lending criteria.

The financing represents a partnership between a specialist lender focused on machinery and industrial assets and a larger financial institution providing additional funding capacity. For Loeb, the facility should allow it to scale a lending model that relies heavily on the underlying value of equipment rather than solely on a borrower’s conventional credit profile.

Loeb describes its approach as primarily covenant-free lending secured by machinery and equipment. That makes the company part of a broader specialty-finance ecosystem that sits between conventional commercial banking and more specialized forms of asset-based and private credit.

“Getting our clients the working capital they need without the hurdles traditional lending can put in their way” is how Loeb President Eric Schwartz characterized the significance of the new facility.

The distinction matters because equipment financing is not a niche corner of the U.S. credit market. The Equipment Leasing & Finance Association’s latest CapEx Finance Index projects $137.3 billion in equipment-finance new business volume for 2026, which would be a record and 14% above the previous high set in 2024. July alone generated $14.3 billion in seasonally adjusted new business volume, with AI-related investment contributing to the surge.

An asset-based alternative to conventional lending

Traditional commercial lending typically evaluates a company’s cash flow, profitability, leverage, credit history and other financial indicators. Asset-based finance adds another dimension: what can be recovered from identifiable collateral if a borrower cannot repay?

That can be particularly relevant to manufacturers and other asset-intensive companies whose machinery represents a substantial portion of their economic value.

Loeb has operated in equipment valuation, financing and liquidation for more than 140 years. Its model combines equipment appraisal and collateral expertise with lending, allowing the company to assess machinery not simply as a line item on a balance sheet but as an underlying source of repayment.

The new revolving facility gives Loeb more capital to deploy through that model.

For borrowers, the attraction is potentially greater flexibility. A company that has valuable machinery but does not fit a bank’s preferred credit profile may have another financing route without raising equity or restructuring its entire balance sheet.

That does not mean asset-based lending eliminates credit risk. Instead, the underwriting emphasis changes. Collateral valuation, liquidity, depreciation, resale markets and the lender’s ability to recover equipment become critical considerations.

Why banks are backing specialty finance

Pinnacle’s involvement also illustrates how specialty finance companies can complement rather than simply compete with banks.

Large financial institutions have scale and relatively low-cost funding, while specialist lenders can possess deeper expertise in particular asset classes and borrower segments. A credit facility can combine those strengths without requiring the bank to build the entire origination, valuation and servicing infrastructure itself.

Pinnacle Managing Director Steven Safirstein said the bank views Loeb as a disciplined specialty finance platform serving the middle market.

That model is becoming more relevant as asset-based finance expands within the broader private-credit ecosystem. PwC’s 2026 Global Private Credit Survey found that asset-based finance and specialty finance were among the segments credit portfolio managers considered most attractive, reflecting a wider expansion of private credit beyond traditional corporate direct lending.

For Loeb, the timing is notable. Equipment demand remains resilient despite uncertainty around interest rates, tariffs and economic growth. ELFA’s July data showed year-to-date equipment-finance volume up 16.8% from 2025 among surveyed members, while the industry’s full-year forecast reached a record $137.3 billion.

What the facility means for manufacturers

The immediate impact is straightforward: Loeb has more borrowing capacity to originate loans.

The strategic impact is broader. Manufacturers increasingly need financing for machinery upgrades, production expansion and replacement equipment, while lenders must balance those capital requirements against changing interest rates and credit conditions.

A lender that can evaluate specialized equipment efficiently can potentially serve companies that a generalized underwriting model may overlook.

For finance executives, however, the relevant question is not simply whether an equipment lender offers faster access to capital. Borrowers need to compare total financing costs, advance rates, collateral requirements, repayment structures, default provisions and the implications of granting security interests over critical production assets.

The same collateral that makes equipment finance accessible can become strategically important if the borrower encounters financial stress.

Loeb’s expanded facility therefore illustrates a broader shift in financial infrastructure: capital is increasingly being segmented according to the characteristics of the underlying asset and business model rather than distributed solely through standardized corporate credit products.

That trend should continue to create opportunities for specialist lenders, banks and alternative-credit platforms as businesses seek financing for increasingly expensive physical assets.

For Loeb, the $25 million facility provides additional room to grow. For the wider market, it is another example of how specialty finance is filling gaps between conventional bank lending and the increasingly diverse universe of asset-backed capital.

Market Landscape

The equipment finance market enters the second half of 2026 with unusually strong demand. ELFA’s July CapEx Finance Index recorded $14.3 billion in seasonally adjusted new business volume, 24.5% above the previous monthly record, while its full-year forecast reached $137.3 billion.

At the same time, credit markets are becoming more segmented. Banks remain important sources of capital, but specialty lenders and asset-based finance providers can address borrowers whose financial profiles, collateral or capital requirements do not fit standardized bank underwriting.

PwC’s 2026 private-credit research points to asset-backed and specialty finance as increasingly important areas for investors.

Loeb’s facility sits squarely within that trend: a bank supplies lending capacity while a specialist lender applies equipment-specific underwriting, valuation and recovery expertise.

The competitive landscape includes traditional bank equipment-finance divisions, independent equipment finance companies, manufacturer-affiliated captive lenders, leasing companies and private-credit investors. Borrowers therefore have more financing options, but those products can differ substantially in pricing, collateral structure and flexibility.

Top Insights

• Loeb secured $25 million from Pinnacle Bank, expanding equipment-finance capacity for manufacturers and businesses underserved by conventional commercial credit.
• Equipment finance demand remains strong, with ELFA forecasting a record $137.3 billion in 2026 new business volume across surveyed industry participants.
• Asset-based lending is gaining relevance as specialty finance attracts capital from banks and private-credit investors seeking differentiated middle-market opportunities.
• Manufacturers can benefit from collateral-focused underwriting, particularly when machinery values provide stronger financing support than conventional credit metrics alone.
• The partnership highlights banking’s evolving role, with financial institutions increasingly providing capital to specialized lenders rather than competing across every lending segment.

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