Billionaire whose firm backed Trump’s US$175 million bond reveals how the deal came together

Don Hankey, the chairman and majority shareholder of Knight Specialty Insurance, told CNN on Tuesday that the deal to underwrite former President Donald Trump’s US$175 million bond in New York came together quickly and that Trump posted all cash as collateral.

“It’s what we do. I’m happy to do it. We would have done it for anybody else,” Hankey said in a phone interview. “It was an easy transaction. It was put together very quickly.”

Based in California, Knight Specialty Insurance is known for providing subprime auto loans to car buyers with weaker credit scores.

Hankey, who has supported Trump’s presidential campaigns, said initially he reached out to the Trump Organization last month when the former president was having trouble putting together a bond of US$464 million. Hankey has amassed a fortune that Forbes values at US$7.4 billion.

“We had a conversation about putting together a bond of that size,” Hankey told CNN.

After the amount of the bond was slashed to US$175 million by a New York appeals court, the Trump team eventually reached back out to Knight Specialty, according to Hankey.

At first, Trump planned to post a mix of investment-grade bonds and cash as collateral (80 per cent bonds and 20 per cent cash), Hankey said. Although Knight Specialty received the bonds and approved them, he said they were not posted in the end.

“Ultimately, he put up all cash,” Hankey said, adding that he does not know where the US$175 million in cash that Trump posted came from.

Hankey confirmed to CNN that he and his wife, as well as their two sons, have donated to Trump’s presidential campaigns in the past and plan to support him again in 2024.

Although Hankey said he has not heard directly from the president, he said Eric Trump did reach out Tuesday morning to thank him for the business.

It’s not the first time Hankey and Trump’s businesses were intertwined.

In 2022, Axos Bank, a California lender, loaned Trump US$100 million to refinance the mortgage on Trump Tower.

Although Hankey is a leading shareholder in Axos and was at the time of the 2022 loan, he said he was not aware of the Trump Tower loan at the time.