Investec Asset Finance (AF) has appointed a
new head of sales to help drive “cautious opportunistic growth”
following a successful year for the company.
Wesley Harfield joins with 20 years experience
in the asset finance industry to help grow the business through
increased levels of origination within the broker, direct and
vendor channels and will report to head of asset finance at the
specialist bank, Mike Francis.
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Francis said: “Wesley’s appointment will help
us to grow both our already very successful small-ticket broker
business and our vendor business, based within our subsidiary Lease
Direct Finance, one of the largest asset finance brokers in the
UK.”
Harfield joins Investec from his previous role
as managing director of Lombard Specialist Finance at time of
steady growth for the Asset Finance business which has seen a
five-fold increase in profit since 2010.
Draft audited accounts for the year to 31
March 2011 show a £13.3m pre-tax profit up from £2.5m for the
previous year.
“I’ve known Mike and the business for a long
time – we have done business together before,” Harfield told
Leasing Life.
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By GlobalData“This is an exciting place to be. The recent
history has been quite prolific – we are in a good place.”
Harfield and Francis both identified growth in
the broker sector where the bank acts as funder as important to the
future of Investec AF and suggest they will expand to middle ticket
assets as well as new lending products.
“We are looking to expand in a controlled way,
said Harfield. “There are some niche product areas I’ve had
historical experience of that I think we could move into.”
Harfield mentioned invoice discounting as a
possibility, expansion of Investec’s block discounting operation,
which currently just a small part of business and contract hire.
Investec AF has got a taste for the latter thanks to the
acquisition of Masterlease with Leasedrive in late 2010.
Investec AF bought the Birmingham-based
vehicle leasing business from Ally Bank (formerly GMAC) and
Leasedrive operate and manage the company on its behalf and
Harfield believes this model could work again.
He said: “We make so secret of the success
we’ve had with Masterlease and Leasedrive – the asset type is very
liquid and offers a good level of security and by working with
other service providers you get to a type of credit quality you
might not ordinarily access. It makes sense for us to do that.”
Masterlease is not the only successful
acquisition made by Investec in recent years; Francis cites the
purchase of Universal Leasing and the 75% shareholding in broker
Leasing Direct Finance as vital to the growth the AF business has
seen since the start of 2010.
On top of the profit increase, Investec AF,
awarded SME Champion at the 2010 Leasing Life awards, reported
£250m in new business over the period.
New business to SMEs was £112m in the
first six months of 2011, up 20% from the same period last
year.
Francis expects this to continue through
lending to a diverse roster of customers, including more blue-chip
customers like those picked up in the Masterlease deal.
“We have come from the real S of SME to blue
chip customers and that is exactly what we want – a diversified
portfolio,” said Francis.
Francis is positive about the position of
Investec AF and its future and says the division is open for
business and seeking new partners in brokers and for vendor finance
programmes.
However, he identifies the Eurozone sovereign
debt crisis and the need for asset finance to increase its exposure
as two potential hurdles to growth.
The eurozone crisis he says, unlike the global
financial crisis of 2008 which was consumer and corporate led, is
country led and as yet is not coming down to corporate level but,
added Francis, Investec AF’s relatively short-term portfolio of
leases will dampen any impact should the crisis worsen and affect
business.
Of more definite concern to Francis and
Harfield is the need for asset finance industry to grow as a whole
and capture more of the lending market in the UK.
“Asset finance is a very viable product for
corporations and not nearly widely used enough. It is not
particularly well understood,” said Francis.
“It is very difficult because it isn’t seen as
a particularly…glamorous or exciting product and this is part of
the jigsaw puzzle.
“The industry needs to promote itself; the
funders need to get back out there. It is a form of term lending
and that is what the country needs to get things moving.
“If you can get five year money you are doing
well and this is an industry that offers that. Very few banks will
give you five year guaranteed overdraft facility.”
With his new head of sales looking at new
lending products and an increasing spread of customers Francis has
confidence in the future of business.
“We remain confident this year will be a good
year, next year will be a good year and onwards. We are in a strong
position,” he said.
“The strategy is cautious growth and to be
opportunistic – that is it.”
grant.collinson@vrlfinancialnews.com
