Lowell Group Tops Charts in OC&C Credit Management and Debt Collection Index

Leeds-based debt buyer Lowell Group has come top of the charts for the second year running in the OC&C Credit Management and Debt Collection Index.

Lowell scored 63 points in the 2009 index, three less than last year, just beating hybrid Capquest, which rose from eighth to second with 62 points. The annual index, compiled by strategy consultancy OC&C and published exclusively in Credit Today, uses quantitative and qualitative measures to rank credit management and debt collection companies in the UK and Europe.

This year the index reflected a turbulent year in the industry, with dramatic alterations in many of the scores compared with 2008. However, one of the report’s author’s – OC&C managing partner David Hosein – said the credit crunch was no excuse for poor performance. “The writing was on the wall for people who had not improved their businesses before,” he said.

Last year OC&C predicted that Lowell’s clear strategy of focusing on low balance UK debts would be an advantage in a downturn and it has enjoyed “stellar growth and financial performance” since. The low balance focus means it has been less susceptible to declines in settlements and its arrangements are also holding up. This year it has also acquired trace business J2, allowing it to hold onto another strategic advantage.

Capquest, meanwhile, is the index’s rising star. Operationally excellent, it has mastered onshore and offshore capabilities with a South African call centre, and has a strong management team. It covers all elements of the loan lifecycle and has entered the mortgage collections market as well as being an early adopter of compliance and security standards. Its challenge is now to manage its diversity, said OC&C.

The Lewis Group, another debt buyer, came third in the index from thirteenth last year – praised for its range of techniques and size as well as top line growth. Parent company Cattles may have struggled but this means it is less likely to be dependent on the parent, said OC&C.

Following Cattles, Lindorff scored 49 points and moved up the index one place to fourth. The European giant’s strategy “goes beyond hybrid” said OC&C, with scale, size and a good management team. Operationally successful in many countries, it is a rarity in the purchase market. In fifth place is Cabot Financial, dropping from 61 points and fourth place to 49 points in 2009. OC&C said the size and scale of the debt purchaser has kept it in the top five but believes it to be on a downward trajectory and facing numerous challenges.

Also praised by the index authors as “rock steady ships” are debt collection agency BCW Group, bailiffs Equita and debt solutions provider Invocas. However, debt buyers 1st Credit and Aktiv Kapital suffered, plummeting from joint second positions last year. For the full index visit http://www.credittoday.co.uk/filestore/homePDF/CT_Oct09_occ2.pdf

The index is not intended to be used as an investment guide or as a way of identifying businesses that will fail.