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UK loan work out group recapitalised

Crown Mortgage Management has been given extra ability to co-invest in performing and non performing loans alongside investors such as opportunity funds.

The servicing operations of UK loan work-out group Crown Mortgage Management have been recapitalised by private equity real estate firm, Forum Partners.

A fund managed by Forum is providing equity enabling Crown to buy out its servicing and mortgage co-investment operations from Crown Westfalen Bank. It will allow the firm to co-invest more fully alongside those buying performing and distressed loan pools.

Crown has more than 100 employees in London and Ipswich, with affiliates in Germany, the Benelux and the US.  According to a statement, the company has experienced significant growth in recent years as mortgage lenders have chosen to outsource the ongoing management of their mortgage portfolios in order to achieve better performance and control costs.

The firm specialises in managing performing and non-performing commercial and residential mortgage loans and has more than £3 billion ($4.9 billion; €3.4 billion ) of loans under management.

Crown chief executive Steve Haggerty said the transaction would provide Crown with a “secure capital base” and a “regulatory framework” from which it can “take greatest advantage of the growing market for third party management of commercial and residential loans”.   

Russell Platt, chief executive of London—based Forum Partners, said in the statement that banks and other lenders face a growing need to utilize the services of loan servicing specialists. “Crown should benefit from greater independence and the ability to co-invest alongside its clients in performing and distressed loan pools.”    

Forum manages three European vehicles. The latest, Forum European Realty Income III, was established in 2007 and raised €442 million.