Lowell posts UK NPL purchases of £229m

Pan-European debt purchaser Lowell acquired a total of £307m of non-performing loans (NPL) in 2016, its annual results reveal.

Lowell posts UK NPL purchases of £229m

Lowell’s group cash EBITDA increased by 20 percent to £254m, from 2015 to 2016. The firm said this has been driven by a 23 percent increase in NPL cash collections and an 18 percent rise in third party collections income.

For the full year of 2016, it acquired £229m of NPLs in the UK and £78m in DACH countries. Of these acquisitions, 62 percent were spot sales and the remaining 38 percent were forward flow contracts.

Lowell signed 47 forward flow contracts in 2016, a rise from 37 contracts in 2015. Its committed spend and signed forward flow visibility is more than £310m on future purchases up until 2021.

Overall group figures in the results were boosted by Lowell’s acquisition of two third party collections firms last year, German firm Tesch Inkasso and Austria-based IS Inkasso.

And following a merger with <German-based GKFL> said: Lowell GFKL Group has been rebranded and has now settled on the name Lowell.

James Cornell, chief executive of Lowell, said: “2016 was an important year in our growth with a number of strategic acquisitions across Europe, and the completion of an additional bond issuance.”

The results also show that across the group, a total of 336 portfolios were acquired last year. Nearly half, 45 percent, were acquisitions in financial services, 32 percent from retail and 18 percent from communications clients.

The debt purchaser’s 120-month gross ERC hit £1.8bn in 2016, a year-on-year increase of 30 percent, with 39 percent of this to be received as cash collections in the first two years.

The company is still waiting on full authorisation from the Financial Conduct Authority (FCA), but said there is reason to believe it will be forthcoming shortly.