Cattles confident its loan business can thrive amid crisisSub-prime lender Cattles plans to raise more than £200m from shareholders to bolster This article is about the pillow called a bolster. For other meanings of the word "bolster", see bolster (disambiguation). A bolster (etymology: Middle English, derived from Old English, and before that the Germanic word bulgstraz its balance sheet so it can increase lending to people on low incomes. The specialist lender feels it can capitalise Verb 1. capitalise - supply with capital, as of a business by using a combination of capital used by investors and debt capital provided by lenders capitalize on the crisis in the banking industry. It said a lack of funds meant it was turning away a growing number of potential customers who wanted short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. loans to buy cars and pay bills. Unlike high street banks, which have steadily withdrawn from the market, Cattles believes it can expand its loan business while avoiding the predicted rise in defaults as the economy worsens over the coming year. The company will also use the rights issue, which will be deeply discounted, to bolster its application for a banking licence. The chief executive, David Postings, said a banking licence would allow the lender to take in deposits and become less reliant on wholesale funding. Cattles said it had raised £200m in new bank facilities this year and was confident of securing the additional £100m of debt funding it requires to finance its 2008 business targets. However, it was paying more than 8% interest on its own borrowings and could generate more cash from savers offering lower rates. Postings said: "It will diversify diversify To acquire a variety of assets that do not tend to change in value at the same time. To diversify a securities portfolio is to purchase different types of securities in different companies in unrelated industries. our funding sources and will enable us to raise funds at slightly cheaper rates than we are paying the banks. The latest tranche Tranche One of several related securities offered at the same time. Tranches from the same offering usually have different risk, reward, and/or maturity characteristics. tranche A class of bonds. of debt we are raising will be at a margin of 2.5 percentage points over Libor – no one is offering 8% at the moment in the retail savings market, so we are very confident we can offer a very attractive rate and still save money." He hopes to raise £1bn by the end of 2010. Analyst Kleinwort Benson Kleinwort Benson was a merchant bank based in London. Wasserstein described the timing of the move as "odd", but conceded con·cede v. con·ced·ed, con·ced·ing, con·cedes v.tr. 1. To acknowledge, often reluctantly, as being true, just, or proper; admit. See Synonyms at acknowledge. 2. that Cattles' record in the sub-prime sector was strong and it could reap higher returns whle the banks continued to nurse their credit crunch-inflicted wounds. It said: "The bank continues to raise wholesale money successfully, suggesting that this is not an emergency issue. Nevertheless, wholesale money markets remain restricted at a time when Cattles is receiving a very high flow of applications. With redemptions also coming down, it is understandable that Cattles would want to look at all available funding avenues. "The rights is the first step in applying for a bank licence that will enable it to take deposits and capture the increasing volume of business coming its way as larger institutions tighten their own criteria." The nine-for-20 rights issue is priced at 128p a share, well below the 227.25p it closed at this afternoon, up 7.75p on the day. Postings said the group was confident it had the funding "to see us through the whole of next year". Cattles said it had made a strong start to 2008 and was achieving higher margins on new lending. Impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. and arrears A sum of money that has not been paid or has only been paid in part at the time it is due. A person who is "in arrears" is behind in payments due and thus has outstanding debts or liabilities. ratios were stable, and it expected trading conditions to remain "extremely favourable". 
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