Leading debt purchaser Arrow Global has seen a remarkable period of growth - of 181% - over the past 18 months since the company was bought out by its outstanding management team in 2009.
It has rapidly evolved into one of the biggest and strongest players in the UK and international debt purchase market, now owning or managing £2.95bn in receivables.
Just some of the deals done in the past year include a £100m face value purchase from a large telecoms provider; a five-year asset management contract for £1bn claims in 2010 plus £2bn in 2011 to 2015; a £100m face value purchase on a 12-month flow with a leading global credit card provider; a £58.6m face value purchase - one of the largest ever deals with a UK building society; a £493m face value purchase on an onward sale of Iberian assets by a large global creditor; and a £149m face value purchase as part of a warehouse sale from a leading UK retail bank (see Figure 1).
Indeed Arrow Global has now grown to such an extent that it is the largest debt collection agency placement client in the UK outside of the major high street banks. It has 75,000 rehabilitated customer paying accounts and 60,000 active litigation cases (see Table 1 and Table 2).
And this growth looks set to only continue into 2011 and beyond, with a further £1.6bn already contracted or awarded for the coming 12 months.
Such buying power is based on real financial strength, featuring almost £50m of net assets and absolutely no third party debt.
Managing such a substantial portfolio requires an exceptional senior management team, and Arrow has been aggressive in its recruitment strategy to seek out the very best.
Arrow Global executives currently hold seats on both the board of the Debt Buyers & Sellers Group and the board of the Credit Services Association.
Sir George Mathewson
Sir George was appointed chairman as the latest step in one of the most noted careers in the credit industry.
He brings with him a wealth of experience and contacts at the very highest level.
He is best known for transforming the Royal Bank of Scotland from a struggling regional player into a global powerhouse after the £20bn takeover of the much larger National Westminster Bank in February 2000. This is still considered by many in the industry to be one of the defining masterstrokes in UK banking history.
He is also the convener of Scotland's Council of Economic Advisers.
Andrew has been appointed chief investment officer, bringing unparalleled industry experience and understanding, with over 15 years experience in distressed asset investing.
Prior to joining Arrow Global, he spent ten years with CarVal Investors, where he served as a director with responsibility for managing investments in loan portfolios in the UK, Spain and Portugal.
Jack was the original founder of Arrow, which he served as president and chief executive officer from 1995 until its sale in 2009, with responsibility for leading the overall strategic direction of the company.
He has also served as head of Citibank's European treasury consulting group and established the international capital markets group at Drexel Burnham Lambert.
He has now returned to the firm as an investor and non-executive director, bringing with him the sound strategic thinking and experience that one would expect from a respected industry analyst and published author on the subject of business and entrepreneurialism.
Springboard into the future
It is fair to say that Arrow is a well-established business. It was founded, as Arrow Financial Services, back in 1961, and Arrow Global itself was launched in London in 2005.
However, since the management buyout in 2009, when Royal Bank of Scotland Equity Finance became the lead investor, things have really started to move quickly!
As with any business, true strength comes from building the right platform, which we have done, putting all the right analytics in place, and recruiting some of the most outstanding players in the industry.
We have established partnerships based on trust with some of the leading companies in the debt collection industry, and continue to innovate, introducing new, and better, ways of working.
I truly believe that the coming year will see debt purchase re-establish itself as one of the leading areas of the credit industry, bringing better collections rates and profitability as well as ever more ethical collections practices, focusing on rehabilitation and the appropriate treatment of each individual customer.
Debt sales are now starting to happen in greater numbers as creditors come to the market with a desire to sell and so, for the agencies which have a strong capital base, future prospects look bright.
The international market is showing some very interesting signs, as we have seen with our recent activities in Portugal.
With the best team in place, the right technology, and superior analytical capabilities, the future is indeed exciting for Arrow Global.