NMCL, page-2

I have concluded that the business of buying PDLs is well understood by the debt-buying sector, so apart from a disciplined mentality, there is no moat there. Much the same applies to the attitude towards collections, skip chasing and the like, with the rider that access to a deeper pool of inforation on delinquent debtors and honest debt payers helps. A significant differentioator is the ethics and mentality of management, so that puts CCP ahead of the pack, IMO.

There is another factor that is now more important than in earlier years, and that is recruitment, training and retention of collections staff. This is where CCP's wider spectrum of commercial activity centered on collections helps - that is, how the loans business and the agency collections complements the the core business of collecting on PDLs. If one has collectors working in the three arms of business, they can be switched from one arm to another, depending on need, and new recruits can cut their teeth in a lower quality of debt (non-bank PDLs).

The collections facility in the Philipppines was originally opened to allow CCP to acquire and process non-bank PDLs, but by now many of the collectors there would be on par with those based in ANZ and America, so they can be, and have been, switched to collect on higher quality PDLs, and new recruits can fill the vacuum created lower down the ladder.

We now have the situation where Management has investment-deployment options in ANZ bank PDLs, US bank PDLs, ANZ non-bank PDLs, US non-bank PDLs, ANZ loans and US loans. Within any location, staff can be redeployed between collectiong on bank PDLS, non-bank PDLs and loans, plus collecting on an agency basis. There is also leeway for collections centres to complement each other within a specific geography, and in the case of the Philippines, across geographies. This flexibility helps to hire, train, promote and retain staff.

I have mentioned before (Post 59290145) that Management has found restaurant and entertainment-venue employees a good source of recruits. From memory, Don McLay mentioned this in a Chairman's address in recent years (I think in reference to recruiting staff in the US).

In summary, all CCP's lines of business complement each other , and that is why we can expect collections as a service to remain as a useful cog in the mechanism.