When you talk to Philip George, the enthusiasm in his voice is evident. He is excited and invigorated when discussing his latest challenge. And his confidence is infectious. You can't help but come away from meeting him and feeling that what he says makes sense.

His enthusiasm is all about his latest job as managing director of Commercial First, the new company set up by Martin Finegold and David Johnson, two of the greatest pioneers in the non-comforming mortgage market. Martin was the prime mover behind Kensington Mortgages while David was the instigator at igroup. Since the company formation a year ago, it has created what Philip describes as a "unique new opportunity".

No wonder he embraced the chance to join the revolution despite, he says, being offered top jobs at already-listed companies. In a way, the creation of Commercial First is a little like the Russian revolution at Chelsea in that both have created crack teams. But with one major difference. At Chelsea the new boss – Roman Abramovich – came in knowing little about the club and with no apparent depth of knowledge of English football. At Commercial First the people who run the business have proven knowledge and success.

Philip George is a good example of that expertise. The 52-year-old has more than 30 years' experience as a qualified banker. He rose to become managing director of First National and while he was in charge, the company grew eight times in size to a balance sheet of £8 billion and profits of £120 million a year.

Before joining Commercial First he headed up Abbey's team in the successful sale of the secured and unsecured businesses of First National to GE Capital, the world's largest company. In his current role as managing director of Commercial First, Philip bears the responsibility for the day-to-day running of the rapidly-growing new business.

It's a responsibility he appears to enjoy. "I needed no persuasion to join Commercial First because it was an incredible opportunity," he says. "They have such a good team, and such a good business proposition."

The company is relatively small at the moment with just 28 employees. But Philip is relishing the challenge of growing the business. "When I originally joined First National there were 250 staff. When I became managing director we had 1,000 which rose to 4,000 by the time I left. So I have seen a company grow and, while I'm used to running a big business, I can remember what it was like to work in a small business."

The experience, he feels, will stand him in good stead as Commercial First grows. He expects to contribute a major part to its future success and has strong beliefs about senior executives being visible throughout the company. "There's never an excuse for not being visible," he states. "In the past I've been used to rolling my sleeves up and getting involved in the business and I intend to do the same now. I spend time in the underwriting floor and with every employee in the organisation."

It's equally important to meet contacts outside the company, Philip believes. "It's very easy for a senior executive to hide behind an in-tray. But it's so important to meet intermediaries. I will try and meet all the major intermediaries at least two or three times a year."

Commercial First celebrates its first anniversary this month after having been set up in November 2002. Philip joined in July this year. "I think there's a huge potential in this marketplace. Originally I thought it was a large niche but now I feel we are creating a huge middle market," he says. He likens the process to that of David and Martin creating the non-comforming residential mortgage market with Kensington and igroup.

Mention of Commercial First's chief executive and executive director brings us back to Chelsea. "Claudio Ranieri will have difficulty with the chemistry of all the players," suggests Philip. "The great thing about Marty, David and myself is the chemistry we have. We all bring different areas of expertise to the business."

"Marty brings incredible expertise on the funding side while David is the most charismatic lender in the business." Where does Philip George fit into the mix? "I provide a bridge to both of them. People say that I am very personable and I have always been proactive in creating business. Together we can convince analysts, investors and banks of the validity of our business."

Commercial First is owned by the management team and a "significant number of outside investors". According to Philip George, it means "we are effectively lending our own money. It shows the confidence we have in the business."

It's confidence that seems to be backed up by results. Philip says the company's key target is to have paid out business of £100 million by the end of the year. "We're well on target to achieve that," he claims. But the next target shows he serious he is when he says "we hope to build this into a substantial business".
The company hopes to have a billion-pound's-worth of business by 2006.

How will they achieve that? "There are many residential brokers receiving commercial applications but feel that they can't place this business," he says. "That's where we come in. We're helping to create new income streams for them."

Philip feels that there is a vast untapped middle market for commercial lenders. "I have no problem with the major banks and building societies taking the slice of commercial business they want. But that tends to be low-rate, low-margin, low-risk, large commercial transactions," he points out.

At the other end of the scale he says that those borrowers with considerable adverse status can go to one of the many credit impaired lenders. It is the borrowers in between that interest Commercial First.

"In between there's the middle market of the disenfranchised customer who may not be able to produce fully-audited accounts, but may have their own property," Philip explains. "The marketplace is in the millions."

According to the company's blurb a typical customer will have the following characteristics: self-employed; small enterprise owner/manager; work and live from the same premises; lacking three years' statutory accounts; disenfranchised and disillusioned with banks and building societies; variable income verification; and good commercial security.

Philip George believes that Commercial First will help these customers by taking the whole mystique out of commercial lending. As a lender they will not necessarily require three years accounts. They will accept self-certification and, impressively, will give an answer to a loan application within three hours.

They can do this, he says, because they have a very experienced underwriting team. "The underwriting team adds that subjective personal assessment that the banks had thirty or forty years ago," he says.

Many banks now use technology to streamline their loan assessment process. In simple terms, loan decisions are referred to a central computer. Philip is dismissive of the system. "It's a sausage machine way of processing applications," he says. "We use the technology to cut out a lot of the grunt work giving us more time to take a human look at applications."

From his base in Brentwood, Philip George has many challenges to face. Commercial First has had a major impact on the industry in its first 12 months but it will take strong management to nurture that impact into a meaningful business. The company's next step is a series of roadshows during November where it will set out its stall for the
coming year.

Lenders and brokers will be watching with interest.