Carlyle, Pictet launch fine art finance service

Investment houses The Carlyle Group and Pictet Group announced a new unit Thursday that will offer loans against borrowers' fine art as collateral.

The US and Swiss companies said their new Athena Art Finance Corp. will begin offering loans against works of art in the upcoming auction and art-fair season.

Athena will begin with $280 million in equity capital -- just under the record price for one painting, $300 million reportedly paid for a work by Paul Gauguin earlier this year.

Athena will offer six-month to seven-year loans of at least $1 million and worth up to 50 percent of the lowest estimated value of artworks or collections that have "a deep and liquid market resulting in demonstrated value," the companies said.

"The $3 trillion-plus global art market is one of the least developed and least financially sophisticated markets of substantial size in the world," said Olivier Sarkozy, a Carlyle Group managing director.

"Athena's substantial resources and relevant expertise bring a professionalized financial services approach to this underserved market."

The art finance business has grown with the soaring value of fine works of art. The finance unit of auction house Sotheby's has made more than $4 billion in loans against fine art.