Sub-prime lender, igroup has been acquired by US financial services giant GE Capital, marking its first move into the mortgage market.
GE Capital’s move, which will add £1.6bn of mortgage assets to the company’s portfolio, is more evidence that the sub-prime sector is at last coming of age.
Joe Dlutowski, chief executive of igroup, said: ‘Non-conforming lending is proving to be one of the fastest growing sectors of the UK mortgage market and our relationship with GE Capital will allow us to participate in this growth to the fullest extent.’
Ivan Royle, director of communications at GE Capital Group Europe, said that igroup would be a great asset to the company, adding that the move should in no way change the service provided to igroup customers.
‘We believe this acquisition gives us an exciting new product to complement our existing businesses. It is clearly a great market and we are looking forward to welcoming igroup into the GE Group family.
‘The company has grown an excellent client and distribution base so we have no plans to change anything about the business or the products it provides,’ added Royle.
Bill Cherry, managing director of rival sub-prime lender SPML, said that the acquisition would be positive for the market and proved that there is growing confidence in the non-conforming sector. ‘The financial sophistication of GE Capital is a vote of confidence in the sector. GE Capital is known for its diligence in acquisition, so this goes to show how the market is growing,’ he said.