Warburg Pincus – Mariner Finance

From report “Private equity piles into payday lending and other subprime consumer lending”

(Written jointly by Private Equity Stakeholder Project and Americans for Financial Reform)

New York-based private equity firm Warburg Pincus acquired installment lender Mariner Finance in May 2013.[i]Mariner Finance has more than 450 branches in 22 states.[ii] Former Treasury Secretary Tim Geithner serves as President of Warburg Pincus.[iii]

Warburg Pincus Managing Directors Michael Martin[iv] and Arjun Thimmaya[v] and Principal Eric Friedman[vi] serve as directors at Mariner Finance.

Similar to OneMain and Lendmark, Mariner Finance makes larger loans and charges lower rates than payday lenders. Mariner Finance makes personal loans of $1,000 to $25,000, including online loans of up to $7,000.[vii]

Also like the two other installment lenders, Mariner Finance charges fees that can inflate the cost of its loans. In a recent disclosure in Delaware, for example, the lender reported than in addition to charging an interest rate of up to 36%, Mariner also charges a “Recording/ Satisfaction Fee” of up to $151. Depending on the circumstances, borrowers may also face variety of other fees including an “Internet Payment Fee”, a “Check by Phone Fee,” a “Loan by Mail Commitment Fee,” and a “Legal Fee”. Mariner also charges a significant ($150, in Mariner’s case, fee for refinancing loans – which could incentivize the lender to encourage borrowers to refinance.[viii]

In early 2017, Mariner joined OneMain and Lendmark in bundling the loans it makes into securities that it the sells to other investors. In February 2017, Mariner issued $275 million of Mariner Finance Issuance Trust 2017-A securities.[ix]

In addition to unsecured consumer loans, Mariner also offers car loans and home loans.[x]

[i]“Consumer Finance Industry Update,” Hyde Park Capital, May 2014.

[ii]https://www.marinerfinance.com/find-a-branch/, accessed Aug 3, 2017.

[iii]http://www.warburgpincus.com/people/timothy-f-geithner/, accessed Sept 12, 2017.

[iv]http://www.warburgpincus.com/people/michael-e-martin/, accessed Sept 16, 2017.

[v]http://www.warburgpincus.com/people/arjun-thimmaya/, accessed Sept 16, 2017.

[vi]http://www.warburgpincus.com/people/eric-friedman/, accessed Sept 16, 2017.

[vii]https://loans.marinerfinance.com/, accessed Sept 12, 2017.

[viii]Mariner Finance Delaware Fee Disclosure, June 2017.

[ix]https://finsight.com/issuer/467, accessed Sept 22,2017.

[x]https://loans.marinerfinance.com/, accessed Sept 12, 2017.