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Precise Mortgages parent plans to float

Precise Mortgages parent plans to float

Charter Court Financial Services, Precise Mortgages parent company, is planning an initial public offering on the London Stock Exchange.

The company, majority owned by investment firm Elliott Management, is aiming to achieve a free float of at least 40 per cent.

The IPO will comprise an issue of new shares and the sale of a portion of the existing ones held by its major shareholders, Elliott International and Elliott Associates, and certain members of the group’s management, Charter Court said.

The IPO and listing are intended to position the company for its next stage of development.

This will include further raising Charter Court’s profile, assisting in retaining and incentivising employees and providing it with a platform for future growth.

Established in 2008, Charter Court operates through three core brands - Charter Savings Bank, Precise Mortgages and Exact Mortgage Experts.

At 30 June 2017, it had a £4.4bn net mortgage loan book, which has grown at a compound annual growth rate of 92 per cent since December 2014.

The company generated mortgage originations of £1.3bn in the first six months of 2017, an increase of more than 10 per cent when compared with the same period in 2016.

Charter Court aims to maintain net loan growth of at least 20 per cent a year in the medium term, while delivering a cost/income ratio in the low 30 per cent over the same period.

The company is targeting a return on equity in the mid 20 per cent, having achieved 26.4 per cent (on an annualised basis) over the first six months of 2017.

Alan Cleary, managing director of Precise Mortgages, said the group is ready to grow in its specialist mortgage markets, as they continue to professionalise and increase in complexity.

He said: “We are well positioned to take advantage of this trend. We are now focused on the next phase of our development and I believe our IPO and listing will further enhance Charter Court’s profile and support our future growth.”

Precise Mortgages, which was launched in 2010 and now operates in the buy-to-let, residential, bridging and second charge markets, grew its lending by 54 per cent during 2016.

maria.espadinha@ft.com