Subprime lender Advantage’s parent company S&U has confirmed its expansion into property lending by pledging its support for the development of its subsidiary, Aspen Bridging.
Aspen was launched as a pilot scheme in early 2017 and has since established a loan book of around £20m. The loan book is secured on property across England and Wales. Average loan size is £380,000 over terms of up to 12 months for customers who are generally smaller refurbishers and developers.
S&U anticipates increasing its total investment in bridging and property lending to £30m in 2019, and further funds will be dependent on the requirements and performance of Aspen after that.
Anthony Coombs, S&U chairman, said: “After launching Aspen last year, we have been impressed with the progress the business has made in the growing property bridging market. It’s small but growing team have established an excellent reputation within this field; the systems and reputation it has built provide an excellent platform for future growth. Aspen is already in profit and we expect an increasing contribution to S&U going forward.”
Ed Ahrens, Aspen managing director, and director Jack Coombs, issued a joint statement: “We are delighted that the hard work and ideas of the team at Aspen have been recognised by the S&U board in their decision to make further investment and move Aspen forward from the pilot phase. We are now in a great position to build the business and to take advantage of the substantial opportunities we are seeing in the property bridging market.”
In its results for the six months ending July 2018, S&U posted a record group revenue of £44.5m, up 23%. Motor finance arm of S&U, Advantage Finance, net receivables reached a record £263.5m, with a record profit of £16.3m. While loan applications increased 16%, customer numbers were at a record 58,000. Acceptance levels now stand at 25%, down from 31% in 2017.