Former RateSetter-backed lender ‘transforms’ new owner’s guarantor loans business
THE ACQUISITION of RateSetter’s former wholesale lending partner George Banco has made Non-Standard Finance “the clear number two in the UK guarantor loans market”, the consumer finance group has said.
Non-Standard Finance bought the guarantor loan provider last August for £53.5m, which included a minority stake owned by RateSetter.
The London-listed firm said on Tuesday that the acquisition has “transformed” its guarantor loans business, helping that division’s loan book to grow by 35 per cent. It said the acquisition contributed to the group’s overall operating profit rising 497 per cent to £2.7m in its latest annual results.
“Having been held back by funding constraints prior to acquisition, George Banco quickly returned to its previous levels of lending,” Non-Standard Finance said.
Marc Howells, chief executive of George Banco, has been appointed managing director of Non-Standard Finance’s newly-named guarantor loans division. The new business unit, which includes George Banco, “now has a clearly defined management structure and in its first few months as a combined business has delivered strong growth in loan book, revenue and profit,” the firm said.
RateSetter took a minority stake in its former wholesale lending partner George Banco in May 2017 as part of its “interventions” in that segment of the business. It had initially intended to lend directly to George Banco borrowers after acquiring the stake but decided against this in June.
The peer-to-peer lender started winding down its wholesale lending business in December 2016. It subsequently emerged that the Financial Conduct Authority was uncomfortable with P2P platforms lending to other lenders and in February 2017, the regulator confirmed that the practice may be in breach of the rules.