A spokesperson told Family Wealth Report that prior to this agreement, the firm had “no way of solving for certain ultra high net worth client requests” in cases where art was part of the collateral equation.

“UHNW clients consider art as another asset class, so forming a referral agreement was a thoughtful way of adding a solution,” the spokesperson said.

UBS's agreement with Emigrant involves a one-time referral fee. "But it's important to note that UBS is not using its balance sheet on this business - it is 100 per cent a referral agreement," the spokesperson added.

According to a Reuters report, only 22 per cent of private banks surveyed by Deloitte Luxembourg in 2011 said they advised clients to consider art-collateralized loans. Nevertheless, one-third of respondents said they were “giving thought” to adding art lending within two to three years.