CCR recently asked European executives what types of receivables their companies purchase or work.
Juan Jose Garcia, CEO for Adarve Corporacion Juridica, in Madrid, Spain, says, "The main asset is the personal loan used by consumers to finance the purchase of cars, electrical appliances, travel and leisure and home remodeling; then there are mortgages, credit cards, mobile telephone bills, cable television, industrial and healthcare services."
Kari Kyllonen, debt purchasing leader for Intrum Justitia, based in Stockholm, Sweden, says his company collects on bank loans, mortgage deficiencies, bank account overdrafts, credit cards, telecom invoices, mail order and utility portfolios.
EOS Group, based in Hamburg, Germany, works mostly with banks to collect on personal loans and credit cards, followed by mail order and e-commerce, "which is due to our history with Otto Group," a retail catalogue company and EOS's parent, Managing Director Michael Weinreich says. "Roughly a quarter of our business volume consists of mail order and e-commerce. The last 25% consists of utility bills and telephone accounts." EOS also works mortgage loans, "but only in the past two years. It's a new business but very successful."
Tim Freeman, head of corporate development, mergers and acquisitions for Lindorff Group, based in Oslo, Norway, says the typical asset classes vary from country to country. "U.K. consumers use credit cards to buy groceries so there is a lot of card debt. In Germany there is very little card debt."
Generally, he says, Lindorff collects all types of unsecured consumer debt, followed by residential mortgages and business small-ticket leasing – including vehicles and equipment.
The biggest number of transactions in Poland "concerns consumer finance: credit cards, cash loans, installment loans and auto loans," says Piotr Krupa, president of Kruk S.A., based in Wroclaw, Poland. "Mortgage loans are gaining in importance but [this asset class] is only the early stages," he says.
Says Mark Onyett, CEO of TDX Group, a Nottingham, England-based debt broker and consultant, "Core debt sales include credit cards, installment loans and checking account overdrafts. You also have debt sales on secured finance, such as automobiles."
In continental Europe, point of sale, or retail, finance is larger than credit cards. "Retailers do their own financing or have finance companies manage the loans. Retailers typically sell off their older accounts," says Onyett. All across Europe, he says, "the common thread is mobile phone debt. Nearly all the countries from Eastern to Central to Western Europe and the U.K. are selling mobile phone debt. The penetration of mobile phone use has been very high. Some of the big trades have had more than 1 million accounts in one portfolio."