The CSM US Consumer Recovery Fund II is an open-ended “evergreen” fund, domiciled in the British Virgin Islands, that was set up to invest in discounted consumer debt, exclusively in the United States.
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Since inception in early 2020, our partners have originated and purchased over $400m worth of portfolios of consumer debt.
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This fund represents the next evolution of the overall strategy, having initially privately funded the purchase of consumer debt in May 2020, before formalising this investment via a securitisation vehicle that was set up in Luxembourg (e.g. the CSM “bonds”, a series of 4 tranches of different durations, two of which have since successfully redeemed).
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The aim of the strategy is to give investors the same exposure to consumer loans as an asset class but to offer returns to investors of 12-15% per annum, net of fees and operating expenses.
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This is achieved by originating and purchasing portfolios at a deep discount to their face value, with Greenhill Debt Management LLC acting as origination and manager responsible for identifying and employing specialist licensed debt buyers and collection agents to negotiate payment plans and settlements with underlying debtors in order to generate cash and grow the fund’s assets over time.
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The intention of the manager is to produce a “stable value” holding in a diversified portfolio and to have an accumulating Net Asset Value (“NAV”) which will deliver investors returns that are uncorrelated with traditional broader “core” asset classes and to do so with low volatility / downside standard deviation.