pick-up
Turmoil in the credit market is permeating far and wide, even into
the niche SME lending sector. Specialist SME lessor, 1pm, posted an
annual loss of £330,907 for the first quarter of 2007 and exited
the sub-prime loans market in which it had been active since 1998
to concentrate on funding small-ticket leasing deals.
Go deeper with GlobalData
Access deeper industry intelligence
Experience unmatched clarity with a single platform that combines unique data, AI, and human expertise.
The Bath-based firm floated on AIM in August 2006, but in February
the company realised it needed extra borrowing to meet demand, and
forecasted lower revenues and profits for 2007. It also experienced
a large number of delinquencies, even before the market turmoil,
and has since started to fund smaller businesses with a proven
payment history.
Chairman of 1pm, Michael Johnson, said: “Following the flotation in
August 2006 the group found itself experiencing escalating levels
of delinquencies which demanded a detailed evaluation of the
underwriting and collection process together with the provisioning
policy and recovery potential.
“Through this process it became clear that the underwriting
criteria and the credit control procedures required an extensive
revision if the performance of the company was to improve. The
board has conducted a comprehensive case-by-case review.”
But 1pm’s luck is changing. Following a new underwriting policy
that was put in place to exclude any form of adverse credit, the
company also just recently installed a £250,000 block discounting
facility with a bank and has also recorded its highest ever value
in new proposals.
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalDataAfter withdrawal from the sub-prime market, 1pm also appointed 30
new brokers, two specialist legal collections lawyers, and a new
finance director.
Furthermore, between February and June the company secured
recoveries of more than £145,000 – with more than £170,000 expected
between June and October.
Johnson said: “I am delighted to report there is now the
opportunity for a new start based on the sound foundations we have
established that are now commencing to generate strong income
margins in their own right and the added advantage of the recent
restructuring already beginning to contribute positively to the
bottom line.”
