Ann: Credit Corp Group FY13 Results Presentation , page-6

re: Ann: Credit Corp Group FY13 Results Prese... Unsecured lending to people who can't get loans elsewhere isn't impressive. They charge what 40% interest and take 25% provisions less cost of capital... They can probably make a return, and its sensible at the margin where they can consolidate a customers debts and save on a bit of admin duplication, but other than that its very risky business.

There is also the idea they are lending money to the same people they collect it back from as pdl collections, ie trying to clp the ticket both ways.

I don't mind a small loan book where it makes sense, but aggressively growing it is a recipe for future problems. Looks good in the short run, recipe for blow ups long term.

There is also regulatory risk. What if the govt forces a lower rate on these loans? How do u get them off your books.

I think they are reaching now to try and maintain earnings growth and roe and could be doing silly things. I'd rather see them use that capital to grow the US to be honest, or buy back stock. Stick to what you good at credit corp!!!