Kings Hill, UK
Specialist credit card issuer
Early-stage business introduced as part of a consumer-credit thesis.
Palamon’s identified the UK as an attractive macro-environment for specialist credit card businesses as there was a large and unaddressed non-standard credit card market in the UK consists of an estimated 21% of the UK’s adult population (approximately 8 million people) who fail the standard underwriting rules of mainstream issuers.
SAV Credit, established in 2001, pioneered specialist credit card lending in the UK, catering for consumers often overlooked by mainstream financial service providers. Palamon backed the management team to develop the sophisticated under-writing techniques to operate profitably in this market and build out a market leading position.
As a result of strict underwriting and credit management discipline, SAV thrived throughout the financial crisis, experiencing virtually no deterioration in its charge-offs while seeing profits grow rapidly as a result of its increased scale. By 2011, SAV Credit was built into the UK’s leading non-standard credit card provider managing 500,000 credit card accounts with more than £600 million in credit card assets.
On 3 November 2011, Palamon sold SAV to Värde Partners, a US hedge fund. The sale valued SAV at an EV of £472 million.
"Palamon has been a great partner for SAV having invested in it from its start-up. With their strategic and analytical understanding of the consumer credit market, Palamon has been instrumental in building the company into a leading credit card issuer."
James Corcoran, Chief Executive Officer of SAV