With no end in sight to its
programme of recruitment, portfolio acquisition and business
development, Aldermore is proving to be a lot more than just a
fresh name on the market. Fred
Crawley finds out just what this new lender is all
about.
Go deeper with GlobalData
As
Aldermore Bank approaches the final quarter of its first full year
in business, deputy CEO Mark Stephens wants to see the near future
put it “firmly on the map” of British banking, with asset finance
taking a central role in future developments.
Since its formation through the merger of Base
Commercial Mortgages and asset finance lender Ruffler bank by
private equity house AnaCap in June 2009, Aldermore has certainly
been busy.
September 2009 saw the addition of Absolute
Invoice Finance to the bank’s balance sheet, while steadily
increasing panels of brokers in both asset finance and commercial
property divisions have ensured growth despite an extremely quiet
winter for the industry as a whole.
Most recently, the purchase of Heritable Asset
Finance’s portfolio at the start of March saw around £35m (€39m)
added to the Aldermore pot, virtually doubling the bank’s lease
book to make up a quarter of its total assets.
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By GlobalData
Developing IT assets
All very impressive, given that
Aldermore’s IT infrastructure for asset finance is not yet
finished. Division head George Ashworth oversaw the completion of
its first phase last month, allowing back office support for the
bank’s current sales model.
This model is aimed at financing “hard” assets
with good resale potential in the event of a customer default, in
sectors such as construction, materials handling, agriculture and
manufacturing.
At the moment, deals with a value of £100,000
form the majority of Aldermore’s asset finance lending.
“However” says Ashworth, “with the next phase
of the IT build, we can start to bring down deal value, and support
a smaller-ticket business.”
This expansion into smaller-value,
higher-volume business will support Aldermore’s development of
broker-led business, a policy which Stephens says applies across
the bank, in invoice discounting and property lending as well as in
asset finance.
Currently, Aldermore uses a panel of 28 asset
finance brokers, and is in a position to consider further
introducers. In commercial property lending, for example, the bank
is adding four or five companies to its intermediary roster each
month.
Beyond broker business, the new IT system will
provide Aldermore with the means to make significant moves into the
vendor finance space. At the moment, Ashworth’s division manages a
handful of sales aid programmes, but it will soon be capable of
developing new ones and accepting schemes introduced by
brokers.
Offering comprehensive
coverage
While asset finance business has been
centralised at Aldermore’s head office in Peterborough until now, a
network of business development managers (BDMs) is being put in
place in order to give more comprehensive regional coverage.
These BDMs will work from the same locations as
Absolute Invoice Finance, which came into Aldermore’s possession
with a fully-fledged network of regional offices. This congruence,
says Stephens, will not just be physical. Cross-selling is central
to Aldermore’s strategy, as one would expect from a company formed
from lenders in three different fields of finance provision.
From here on, Aldermore’s strategy is
unambiguous.
“Our overall strategic objective is to be
recognised as a bank providing first class service,” says Stephens.
“We want to be one of the first names on any SME’s list when it
comes to acquiring equipment in an asset class we support, such as
materials handling.”
The way to achieve this, in the opinions of
both Stephens and Ashworth, is for Aldermore to identify further
markets of interest and make rapid progress in building a name in
them. For an example of this strategy, one need only look as far as
the move into the professions finance market through the purchase
of HAF.
For now, Aldermore’s greatest strengths are
the speed at which it can make decisions and the liquidity with
which it can back them up. If it can keep such tight lines of
communication as it takes on more staff and more business, its name
will be heard more and more often in UK leasing.
Aldermore buys into professions
market
