Carrick Asset Finance, a Glasgow-based lender and provider of asset finance for SMEs across the UK, started trading on 1 October 2018. The company finances business-critical assets across a wide variety of industry sectors and operates exclusively through a panel of brokers.
Martin Stewart, the managing director of Carrick, says after an 18-month spell working from home, the Glasgow team is gradually returning to its offices on the outskirts of the city to continue pursuing its remit of working with a small, targeted group of introducers and further develop its distinctive service-led, personalised approach to business. Here, Stewart outlines Carrick’s Covid journey so far.
Naturally optimistic though I am, I’d never have expected our business to be in the positive position it is as we approach the third anniversary of our launch. Whilst it’s not lost on me that the tail of the Covid pandemic could yet provide some bumps in the road ahead, over the last year or so we’ve managed to progress and develop the Carrick operation in ways I wouldn’t have thought possible given the general trading environment.
We’ve been very fortunate on the people side of things in particular, where we’ve managed to grow our team by 50 per cent since the start of the Covid-19 pandemic and have enhanced the organisation with some high-quality staff. Each of them has shown tremendous resilience in dealing with the challenge of joining a business and taking on a new role without having visited our offices or met any of their new colleagues.
Martin Stewart, MD of Carrick Asset Finance
Over recent weeks we’ve taken our first baby steps towards a return to normality by arranging for small groups of our staff to spend short blocks of socially distanced time in the new offices we took on a couple of months ago. Watching some of them meet in person for the first time after more than a year of Zoom calls has been interesting and seems to have whetted everyone’s appetite for a return to office life in some shape or form.
As well as marvelling at this resilience, I’ve been amazed at the team spirit and camaraderie that’s developed across the business. To say we’ve risen collectively to the numerous challenges we’ve faced is an understatement, and I couldn’t be more proud of the sense of unity we’ve been able to foster. I think this has been a major contributory factor to the exceptional levels of service we’ve sustained for our brokers and customers throughout the pandemic.
The national sentiment of ‘we’re all in this together’ has played out in our little world as well, and the team’s determination to ensure the challenges of working from home didn’t cause any aspect of our service to fall away has been gratifying to watch.
I firmly believe our service has improved significantly as a result of the Covid crisis. With credit-decisioning times averaging 5.5 hours; a document production service for brokers that consistently produces the goods in two hours or less, and an execution capability that sees us payout over 95 per cent of transactions same-day – we’ve materially enhanced every dimension of our offering.
I think we can lay a credible claim to having a service proposition that’s up there with the best in the market, with regular feedback from our brokers suggesting we’ve flourished in areas where many others seemed to have struggled.
It’s also been pleasing though to see how we’ve grown and performed in financial terms. We’ve increased our lending book by 75 per cent since the start of 2020 and our broker panel by 60 per cent since the beginning of Covid – no mean feat given the extent to which social restrictions have impacted business development and relationship management norms.
Our brokers have been hugely supportive over this time, and I can’t thank them enough for trusting us with their business, particularly when activity levels have been low and there’s been less to go around than normal.
Our view was we’d rather try to do two things well rather than risk doing three things badly, and our brokers seem to have responded well to that approach
We decided quite early on not to seek accreditation under the British Business Bank’s CBILS scheme. This left us able to focus on dealing with any customers requiring payment forbearance while simultaneously providing an uninterrupted and effective asset finance offering.
Our view was we’d rather try to do two things well rather than risk doing three things badly, and our brokers seem to have responded well to that approach. It meant there was an important strand of their business which we couldn’t service, but the portfolio growth we nevertheless managed to achieve shows there was still a good quantity of regular business available – which we were very happy to service.
A combination of consistent, reliable service and fair pricing has allowed us to develop a steadily increasing business flow over the last 18 months.
As our lending book has grown we’ve been able to demonstrate greater appetite for larger transactions, and in several recent months, more than a fifth of our total caseload has comprised cases involving balances beyond £100k – many of them significantly so.
Carrick’s company directors
Martin Stewart has worked in the industry since graduating in 2004 with an accountancy degree. He has been CIMA (Chartered Institute of Management Accountants) qualified since 2011 and has worked with several major lenders, including Macquarie Group, Lloyds Banking Group, BNP Paribas Fortis and Fortis Lease UK.
Iain Corbett has over 30 years’ experience in the asset finance industry, during which time he has held a variety of sales, credit and senior leadership roles with Haydock, Clydesdale & Yorkshire Bank, Fortis Lease UK, and Hitachi Capital Business Finance.
Gary Slavin joined the leasing sector in 2005 and has worked with several major funders including Macquarie Group, Santander UK, BNP Paribas Fortis and Fortis Lease UK.
Gordon MacGregor has worked in the sector for 25 years, holding a variety of senior management positions over that time. For more than half of his fifteen years at RBS Group, he managed Lombard’s activities in the east of Scotland, and has also held key roles at Close Brothers, Clydesdale Bank and Bank of Scotland.
Gerard Moon has over 30 years’ experience in asset finance and has both managed and established various asset finance businesses. He has worked at board level as finance director and chief executive of several lenders and is the former managing director of Macquarie Asset Leasing (UK) and is now Carrick’s Non-Executive Chairman.
Bruce Wood is Carrick’s other non-executive director and has been a partner with law firm Morton Fraser for over 40 years, specialising in asset finance, ABL and invoice finance transactions. The Legal 500 previously described Bruce as ’Mr Asset Finance, Scotland’.
Early signs suggest the commercial asset finance sector has weathered the Covid storm pretty well. That said, the true viability of many of its SME customers won’t be proven until the various government supports completely fall away, so I don’t think anyone with an existing lending portfolio can guarantee they’re out of the woods yet.
Aside from that potential ‘back book’ risk though, I think the leasing industry can take great credit for its performance through this difficult time. What we’ve observed, through our broker interactions, is a sector that enjoys deep, practically-orientated customer relationships, and a product range unrivalled in its relevance and value to the businesses that use it. Customers have known who to turn to when help was required with new or existing funding requirements, and in many cases, it hasn’t been their bank manager.
The transactional nature of asset finance demands agility from providers of those products, and generally drives a more ‘can-do’ mindset than often prevails in other areas of financial services. There’s no doubt having this as a key strand in our industry’s DNA has helped us and our competitors deal with many of the stresses encountered over recent times.
Intermediaries operating in the market have rightly expected funders, whatever other pressures they are dealing with, to still service the demands of the asset-supply led sales-cycle that underpins every new deal. When the customer lets everyone know they’re taking delivery of the asset tomorrow, both they and the broker expect us (pandemic or not) to facilitate that – rather than being the reason it can’t happen.
There’s zero room for complacency, but thankfully Carrick seems so far to have passed that test and, over and above everything else, the thing I’m most proud of is that we’ve never paused our lending activities for a single day throughout the crisis.
We’re tracking very favourably against the fairly aggressive 2021 budget we set for ourselves, while steadily building our market profile and our team
Whatever challenges lie ahead, we’re determined to keep growing and developing the Carrick business. We’re tracking very favourably against the fairly aggressive 2021 budget we set for ourselves, while steadily building our market profile and our team.
We’ve recently strengthened our credit and operations functions; will be recruiting further business development staff over the next few months, and our outlook and day-to-day actions across the business are all underpinned by a fundamental optimism about the future.
We are intent upon doing everything we can to capitalise upon the near and medium-term opportunities we think are on the cusp of unfolding in the UK asset finance space and are excited about the prospects that lie ahead.
Reasons to be cheerful? We’re knee-deep in them.