The Bermuda Commercial Bank (BCB) has bought up a London-based finance company.

BCB has acquired equity and convertible loan notes from its parent Somers Ltd in the Private and Commercial Finance Group (PCFG).

It is the intention of the bank to convert the loan notes to equity before the end of this month, giving it an approximately 75 per cent holding in PCFG, and resulting in the group becoming a consolidated subsidiary of the bank.

PCFG, set up in 1994, provides consumer finance in motor vehicles and business finance for vehicles, plant and equipment to small and medium-sized businesses in Britain, has more than 16,000 customers in that country.

BCB CEO Peter Horton said: “We are delighted to welcome PCFG to the BCB family.

“PCFG is an excellent business well known to us as a longstanding sister company within the Somers Group.

PCFG is a leader in its markets and has a talented and dedicated team.

“It offers a strong earnings history and recognised excellence in service and operations. We look forward to working with the PCFG team and to the benefits that this partnership will provide.”

He added: “PCFG has major scope for growth but will immediately contribute an attractive income stream which diversifies the bank’s revenues.

“This investment also represents a major step towards an efficient asset deployment strategy, which is essential because capital costs will increase once the Basel III regulatory framework is implemented.

“In summary, we see this transaction as a major step forward in our strategy, which is transforming BCB from top to bottom in preparation for take-off.”

PCFG CEO Scott Maybury said: “This transaction presents the company with significant synergies that will facilitate the continued growth and strong performance of PCFG.

“We are excited to conclude this transaction and look forward to building a close working relationship with BCB.”

BCB said the buyup would help the company to diversify its business and strengthen earnings, as well as improve capital efficiency ahead of Basel III implementation and reduce geographic concentration risks.

The deal was done through a Somers Ltd sale of 15.55 million ordinary shares and $5.83 million of six per cent convertible unsecured loan notes in PCFG.

In a second transaction, Somers has acquired 1.22 million common shares in West Hamilton Holdings Ltd, boosting its overall holding in the company to 1.65 million shares. This represents about 57 per cent of West Hamilton’s issued capital.

Somers chairman Warren McLeland said: “We are very pleased to complete these transactions as they represent a significant step for a number of our investments.

“The combination of BCB and PCFG has the potential to create a growing and dynamic asset financing company in a market with a number of exciting opportunities.

“Both management teams will be able to leverage off each other and we look forward to further profit and asset growth.”

He added that the acquisition of West Hamilton Holdings shares “consolidates the group’s share ownership in WHH under one roof.”

And Mr McLeland said: “We look forward to the development of WHH’s residential offering, due for completion in June 2016 and further progress in developing its Pitts Bay Road site.”