In Focus Consumer Credit
Funding the future
Arrow Global has taken a major step with the development of an in-house fund-management business, which will allow investors to participate in a larger volume of purchases. CCRMagazine spoke to Andrew Grimditch, chief financial officer of AGG Capital Management, to find out more
What impact will the first close of the fund announced in December 2019 have on Arrow Global? The launch of the fund-management business is a major transformation of the business. The first impact is, clearly, that it allows us
to do a lot more of what we are very good at, that is to say investing in alternative asset portfolios. We will be able to do so on a much larger
scale, using our leading pan-European platform to help us originate and service assets across our five chosen markets and grow, and to offer investors the sort of returns we have historically achieved. We have announced that by the end of 2020 we target to have €2bn of funds under management. This is a major step for us: over the past
few years we have invested around £250m to £300m of our own balance sheet to buy portfolios of debt. Whereas we have traditionally done some
co-invest deals on a deal-by-deal basis, we will now be able, on a much larger scale,
to buy assets using committed external funding on a discretionary basis. This has an advantage over the more
ad hoc co-funding in that we are not negotiating at both ends. And it moves us very quickly towards our strategic goal of operating a more ‘capital light’ model, and we are boosting our asset management and servicing income as we become a fully integrated alternative asset manager.
Although you have a fund background you are relatively new to the credit industry, what are your first impressions? I come from a previous role where I was creating new structures to run a more established fund as we sought to bring all functions in house. As a result, my initial impression of Arrow
was of its huge ambition to build a fund of this scale in such a short space of time. This is a major project, impacting upon
all areas, and the business has approached this with confidence and diligence.
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www.CCRMagazine.com March 2020
We will be able to do so on a much larger scale, using our leading pan-European platform to help us originate and service assets across our five chosen markets and grow, and to offer investors the sort of returns we have historically achieved. This is a major step for us: over the past few years we have invested around £250m to £300m of our own balance sheet to buy portfolios of debt
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