Having already received preliminary indications from two of its previous investors, Arrow Financial is prepping its next distressed consumer debt securitization for June or July of this year. The transaction will be in the $25 million range, and will follow the acquisition and seasoning of one or two additional consumer loan portfolios.
The company acquires these distressed consumer portfolios, generally backed by assets such as delinquent utility/telecommunication bills, private-label credit cards, autos and other types of consumer contracts. The firm then securitizes and services the assets to maximize recoveries.
Arrow last appeared in ASR when it took part in a joint purchase of a distressed, unsecuritized Heilig-Meyers consumer loan portfolio, worth approximately $60 million (see ASR 10/15/01). Arrow, which is the exclusive servicer on those accounts, will not be including those loans in its pending deal.
The firm is staffed in part by the ex-investment banking team of ContiFinancial, which owned a stake in Arrow prior to the firm's management buyout in late 1999.