What’s New?

• German debt collection fees and recoverable costs legislation – current and forthcoming – and estimated impact on Lowell’s Cash EBITDA
• Scenario-by-scenario evaluation of Lowell SSNs and CDS outcomes with updated probabilities – orphaning vs restructuring vs bankruptcy credit events and deliverability

Questions Answered

• What can we surmise from solo financials for Lowell Financial Services GmbH as to how much of its revenue comes from debt collection fees in Germany and how much of those can we estimate come from debt collection fees charged to debt owners vs those to debtors, the latter being exposed to potential reduction under the new legislation
• What else suggests that Lowell will not see a material Cash EBITDA hit from the new German legislation?
• Why do we view an equity injection in return for SSNs maturity extension / coupon reduction as less likely than before, even as SSNs reportedly attempt to form a group?
• Why would any SSNs group, should it form, not be in a strong negotiating position and how does Permira hold the stronger hand if it wishes to remain in control of Lowell?