Independent lender Private and Commercial
Finance Group (P&C) has announced the end of a two-year period
of stagnation, unveiling a full-year pre-tax profit of £455,336 and
announcing a new funding facility.

“It’s been hard going, especially for
independents and for our competitors who have been driven out of
business, but we have moved from a period of stagnation to one of
growth,” said managing director Robert Murray.

Although P&C’s profits are 14% down on
2010’s full year result of £528,361, Murray puts this down to the
company’s inability, until recently, to secure new funding – 
a situation which led to a 13% reduction in P&C’s book

“Last year we spent a lot of time canvassing
banks and looking at alternative lending facilities and we finally
signed a new £7 million funding facility on 27 June,” he said.

“This is a positive step because the senior
debt market has been difficult in the past two years, but this has
thawed, especially from non-UK banks. The UK banks have had a
number of issues, so we have cast our net wider – and we hope [the
new funder] will look to growing their facilities with us in

CEO Scott Maybury added that the new facility
is provided by an overseas bank with UK representation in a new
relationship for the company, although the bank is not new to the
sector, and offsets the preoccupation of some of the traditional
lenders with the uncertainties around Basel III and a lack of new
facilities as a result. “It’s a case of finding banks who are new
to us and who see an opportunity in the sector,” he said. “A lot of
banks recognise this as an opportunity as they realise the
traditional lenders – including some of the Irish banks – are no
longer interested or involved in the sector. But you have to bring
[the new banks] around to the way it’s done and that it’s a secure
area to lend into as it’s a different sector to what they’re been
used to in the past.”  

The funding will allow P&C’s consumer
finance division, which sources business through motor finance
brokers, to provide more finance for car retail customers.
Meanwhile, its business finance division will increase provision of
hire purchase products for vehicle and plant assets. Murray says he
will make use of the facility during the current financial year
through to March 2012.

He expects P&C’s profit to grow to
£650,000 next year, although he will revise this figure if a
current attempt to acquire a £6 million portfolio of finance
receivables is completed later this month.

Murray also said that cost-cutting measures
taken during the last financial year had not yet manifested
themselves on the company’s balance sheet, thereby adversely
affecting profit. While P&C’s Croxley Green office in
Hertfordshire has been closed, it remains on lease until this
month, while a reduction in headcount from 65 to 52 had generated
redundancy costs.


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