Investment banking firm Jefferies Group and Massachusetts Mutual Life Insurance have doubled their equity commitments to Jefferies Finance, the commercial finance joint venture the two firms founded in October 2004.

With an incremental $250m from each partner, the new total committed equity capitalization of the finance company is $1bn.

In addition, both the firms have entered into a $1bn secured revolving credit facility to be funded equally by the two firms to support large loan underwritings by Jefferies Finance.

Jefferies said that this enlarged capital basis, together with appropriate third-party leverage, will allow Jefferies Finance to grow its business of providing senior loans to companies, originated primarily through the investment banking efforts of Jefferies.

Babson Capital Management, a MassMutual affiliate, will continue to provide portfolio management services. Jefferies Finance has originated over $20bn in loans in the last five years.

Jefferies chairman and CEO of Richard Handler said that Jefferies’ partnership with MassMutual continues to flourish and provide added value for the respective platforms.

MassMutual executive vice president and chief investment officer and chairman and CEO of Babson Capital said this business continues to be a thriving joint venture for both organizations, as it expands the capabilities of Jefferies’ leading investment banking franchise while providing an additional source of earnings for MassMutual.

Jefferies’ commitments to Jefferies Finance will be funded from available cash as the business develops over the next few years.

Jefferies accounts for its 50% interest in Jefferies Finance on the equity method of accounting. In addition, origination and syndication fees earned by Jefferies from Jefferies Finance are included in Jefferies’ reported investment banking revenue.