Midland-based bank Secure Trust has taken over a Cardiff-based lender after its coffers were boosted by a £20 million placement.

Solihull firm Secure Trust (STB) has taken over the V12 Group Finance group which offers retail point of sale unsecured loans to consumers who are predominantly as prime borrowers.

It has agreed to acquire the entire issued share capital of the V12 Group and the existing loan book which had balances of approximately £35 million last month.

The move comes less than a month after STB, which has profited from no exposure to bad debts in the credit crunch, raised a net £19.2 million by placing 1.48 million new shares on the stock exchange.

Paul Lynam, chief executive of STB, said the move was part of plans to strengthen operations in retail lending.

He said: "Over the last three years STB has developed its own retail finance business with lending balances as at the end of September 2012 standing at over £60 million.

"Despite this rapid growth, the market opportunity remains very significant. The 2012 Finance and Leasing Association data showed that over £237 million of in store finance volumes were written in the month of October alone.

"The acquisition of V12 gives us greater critical mass and ownership of a technology-based platform necessary to provide consumers with in store and online point of sale finance. Like many non-bank financial institutions, V12’s ambitions have been frustrated by the lack of wholesale funding in the recent past. STB’s funding will help to unlock V12’s potential."

The deal, funded from STB’s existing resources, will see STB take over Cardiff-based V12 Group Finance subsidiaries including V12 Personal Finance.

The business will continue to trade using the V12 brand and STB said the vendors are private investors including Jon Moulton – best known for leading Alchemy Partners’ bid to buy MG Rover from BMW in 2000, and the V12 management team, which will continue in the business.

It is a complicated deal with £3.5 million paid up front and upon acquisition STB will immediately provide funding so that V12 can redeem £7 million of subordinated debt principally held by Mr Moulton.

In addition STB, which is owned by the Arbuthnot Banking Group, will provide funds on completion to enable V12 to repay its existing bank finance from The Royal Bank of Scotland amounting to approximately £28.5 million.

V12 had a loan book of £33 million as at March 31 and made a pre-tax profit of about £300,00 in the last financial year.

V12 chief executive Nick Davies said: "We are delighted to become part of the STB team and look forward to playing a full part in their exciting future plans for growth. We believe that the benefits of being part of a bigger group will allow us to further enhance our current range of products and services which in turn will improve the service we can offer to our retailers and customers."