£200m securitisation facility for consumer credit provider

Listed consumer credit provider Non-Standard Finance (NSF) has entered into a new, six-year securitisation facility totalling £200m.

The Leeds-based company says the pricing is more favourable than its existing facility and is expected to result in a pre-tax saving of approximately £1m in the year ended 31 December 2020.

On satisfaction of certain conditions, the new facility will be available to fund continued loan book growth for the Group’s branch-based and guarantor loans divisions.

It will also be used to repay a proportion of the current outstanding debt under the company’s existing drawn credit facilities.

The new facility is provided by credit funds managed by Ares Management Corporation.

As of 31 December 2019 NSF had cash at bank of £14.2m (2018: £13.9m) and gross borrowings of £323.2m (2018: £272.8m).

Nick Teunon, NSF’s chief financial officer, said: “This new source of funding is an important milestone for the Group.

“Not only will the securitisation allow us to further diversify our funding sources, it also signals a clear recognition of the quality and confidence in the Group’s two largest and fastest-growing businesses.”

Lazard & Co acted as adviser to the Group for the new facility.

Jeffrey Kramer, partner in alternative credit for Ares Management, said: “We are pleased to support the growth of NSF with this securitisation facility, which will better position the company to execute on its strategic objectives.

“This transaction is another example of Ares’ ability to use flexible capital to provide tailored financing solutions across the alternative credit market.”