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Elephant Loans and Mortgages (ELEP) has reported its Interims this morning and from a first glance it looks like they are putting everything in place for future growth.

Elephant is a packager of Secured Loans and mortgages and following in the ever-growing trend is launching an IVA division called Debtsmashers.

Again, contrary to the problems reported by Compass, Elephant reports a 29% growth in commission income and a 75% increase in the number of agreements packaged for onward lenders.

Despite turnover going up, the group has made a substantial loss brought about by a dramatic increase in administration expenses (800k up to 1.5m). Elephant points out this is due to opening a further four branches, bringing its total number to seven, and recruiting additional staff.

Elephant feels that having direct to customer branches improves conversion rates and, to be honest, it will have to improve it significantly to cover the overheads and staff costs. It seems a strange strategy for Elephant to take on the big boys with a branch network and I guess only time will tell if they can pull it off.

Elephant says it has also signed up more affiliate partners and improved its commission rates with lenders. In October it raised nearly £1million with a share placing and says this will be spent on growing Debtsmashers.

Elephant was only admitted to Aim late last year and I’d rate it has a reasonably high risk share.

It’s difficult to know what to make of market speculation, but the story doing the rounds at the end of last week was that Barclays is a takeover target of the Bank of America.

If this is true then it seems very strange that the Barclays Chairman, Matt Barrett, sold £6.5 million worth of shares last week. People also speculate that the two organisations would be a good fit. Bank of America recently bought MBNA the credit card company and whilst there would be obvious synergies, I’m unsure if Barclaycard wants or needs a merger with another credit card outfit.

Another story doing the rounds in the Sunday newspapers is that Egg, the Internet bank, is the target of another American Financial Giant Citigroup. The Prudential has talked down the offer as speculative this morning and has said it wants to concentrate on fully integrating Egg into its own operations. Despite having 3.5 million customers and an impressive 6% share of the credit card market, Egg still makes large losses.

Going back to Barclays, one shock piece of news last week was that Jeremy Masding the Chief Executive of the Secured Loans wing Firstplus has stepped down.

A Barclays spokesperson said: “Jeremy Masding has decided to step down from his role at FirstPlus to pursue opportunities outside the Barclays Group. Jeremy has made a fantastic contribution to Barclays, Barclaycard and FirstPlus during his 22 years with us. We wish him all the best.”

Masding is oft reported to having been doing well with Firstplus and the group was voted the 12th best place to work in a Sunday Times opinion poll. For what its worth 83% of his staff said his was doing a good job in the same poll.

Compass Finance reported today and three things from its results strike me as odd or questionable.

The first thing is, it reported turnover down from £14.3million to £12.9million and said “The Secured Loans market saw a significant downturn as a combination of higher interest rates and nervousness surrounding house price inflation resulted in a stalling effect”.

Now this strikes me as strange because not one other listed Secured Loans Company has reported a downturn. If we look at their last reports, we see Debts.co.uk reporting an impressive increase in sales and, although they don’t isolate the Secured Loans segment, they also don’t report market problems. We see Debtmatters, although only recently gaining its Secured Loans presence through the acquisition of Loanmakers, reporting no problems and Elephant, who haven’t reported since June, but in October still had the market confidence to refer to themselves as a “fast growing packager of loans”.

The second thing that strikes me as concerning is that Compass says “Following the acquisition of Budsworth & Co, the strategic business model for the Group is now complete, a great step forward for the business. The addition of IVA as a debt solution to sit at the forefront of our product range”.

The striking word here is “forefront”. If we look at the segmental analysis we see that IVAs currently make up 2.5% of sales, so it strikes me as odd that, presumably, Compass will put more resource into growing its IVA business rather than trying to sort out its, what on the face of it looks like a failing, Secured Loans business. I get the feeling Compass is merely reacting to other organisations financial results and the market growth in IVAs and merrily, but maybe blindly, jumping on the bandwagon.

The third thing I find questionable is Compass is going to rename itself ‘The Debt Advisor Group’. Now Compass isn’t the only one I consider at fault for doing this, but I find it misleading to end customers when organisations call themselves names like this. A slight exaggeration, but perhaps its like calling yourself a Doctor just because you advise people on cuts and bruises and profit from them buying band-aids and bandages.