May's Final P2P Lending Platform News Round-up

Totals lent to date (30th May 2018)

*All data correct at the time this blog was compiled.

LOANS TO BUSINESSES

Assetz Capital - £517,700,000

Crowd2Fund - £17,120,000
Funding Circle - £3,400,000,000
FundingKnight - £31,485,000
FundingSecure - £246,359,280
Money & Co - £6 million approx
Rebuildingsociety - £12,400,000
ThinCats - £285,889,000
Invest and Fund - £3 million plus
LendingCrowd - £34,630,176
ArchOver - £68,616,000

PERSONAL P2P LENDING

Zopa - £3,330,000,000
RateSetter - £2,500,000,000

Lending Works - £109,889,103

…………..

LOANS TO BUSINESS

Assetz Capital

Lent to Date: £517,700,000 - £900k growth (0.17%) in the past fortnight.

This has been a very quiet period for throughput at Assetz Capital – the lowest for over a year – although the number of upcoming loans is higher than it has been for a while.

When this blog was compiled there were 77 loans in the pipeline with 3 imminently due to be drawndown.

Highlighted Loan: Today I invested in a loan to a developer for the construction of an 80 bed care home in the Midlands. This was the first <£1 million tranche of a £6.5 million facility. Assetz Capital had already provided the finance to purchase and clear the site. Progress is being overseen by a Monitoring Survey and the LTV would never be allowed to exceed 65%. Multiple security was provided including a First Charge over the site plus Corporate and Personal Guarantees. Investors were offered a return of 8% pa.

Managed Accounts: The following accounts automatically distribute funds on behalf of investors across different sections of the platform's portfolio and are covered by a discretionary Provision Fund (the target rates of return are in brackets):

Quick Access Account (4.1% pa)

30 Day Access Account (5.1% pa)

Property Secured Investment Account (5.5% pa)

Great British Business Account version 2 (6.25% pa)

Crowd2Fund

Lent to Date: £17.12 million – latest available figure.

Over the past 2 weeks, 6 auctions were listed on the site.

Highlighted Loan: A small chain of nursery schools in the Midlands required £80k to refurbish an existing site and open a new location. Both Annual Profits and Net Assets comfortably covered the amount being borrowed although, as is usually the case at Crowd2Fund, there were no details of the security being provided. Investors were offered a return of 10% pa.

Funding Circle

Lent to Date: £3,400,000,000

Funding Circle are unique amongst the major P2P platforms that lend to SMEs in not allowing investors to choose who they lend to. Instead two managed accounts are offered which distribute funds across differing risk profiles of loans within their portfolio. These options are projected to return 4.8% pa and 7.2% pa.

As an active rather than passive investor, I am no longer involved with Funding Circle however posters on forums who remain with this site express concerns over the apparent lack of due diligence that is undertaken.

FundingKnight

Lent to Date: £31,485,000 – no change.

There were 0 auctions ongoing when this blog was compiled – only 1 loan appeared on this site during 2017. The platform is planning a relaunch at some point in 2018 but there have been no signs of life so far.

FundingSecure

Lent to Date: £246,359,280 at end of April – figures are updated monthly.

Today 2 auctions were launched on the site.

Highlighted Loan: Last week a Property Developer required >£1.2 million to purchase a plot of land on the site of a former pub that had planning permission for 29 dwellings. The borrower hopes to get the permission upgraded to 20 larger homes as these will have a greater value. With the current planning permission in place, the LTV is 65%. Investors were offered a return of 12% pa.

Defaults: Not much news. There are an unbelievable number of delays in the various buying processes for items held as security against some of my bad loans. At least there have been no new defaults.

Wheeling & Dealing: Some of my loans have been slow to find buyers on the Secondary Market unlike a few weeks ago when they were quickly being taken of my hands.

Money & Co

Lent to Date: £6 million approx. (latest available figure)

When this blog was compiled there were 3 auctions taking place.

Highlighted Loan: The German Property Developers returned to Money & Co for the fourth time to raise a further £150k. Once again security is provided by that country's equivalent of a First Charge although no indication is given of the LTV. There is also no information on the "Financial Summary" tab for this loan. Those who fancied a total shot in the dark were offered a return of 9% pa.

rebuildingsociety

Lent to Date: £12,400,000 – most recent figure.

There was 1 auction taking place when this blog was compiled and this was the loan featured in the previous blog to the Property Developers who required <£256k of Working Capital to undertake maintenance on their rental portfolio. The auction has been extended twice but is nowhere near being filled as no answers have been given to the numerous questions investors posed relating to the financial information provided. Indeed, many have withdrawn their bids and the loan was only 21% filled compared to 30% when I reviewed it 2 weeks ago. Security was provided by 2 second charges and Personal Guarantees. The maximum bid rate was set at 16% pa.

ThinCats

Lent to Date: £285,889,000 – no change in this figure reported by the platform.

There was 1 auction taking place when this blog was compiled.

Highlighted Loan: Scottish builders required £780k to facilitate a management buyout. Security was provided by Company and Personal Guarantees although the latter was quite small in comparison to the amount being borrowed. Net Assets gave a LTV of 65% but their value may fall if the business gets into trouble and a fire sale is required. Such a scenario appears unlikely according to the information provided as there were many Blue Chip customers with the business not relying too heavily on any single one of these. Investors were offered a return of 8.5% pa.

Invest & Fund

Lent to Date: Over £3 million

There was 1 auction taking place when this blog was compiled.

Highlighted Loan: The conversion of a former Brewery into 6 apartments in the south Midlands continues on schedule with the borrower drawing down the fifth <£40k tranche of the £575k facility. The Monitoring Survey has not flagged up any significant issues on the work which is due to complete September. There were various securities listed including a First Charge over the development however the Loan to Cost was high at 74.5% and the Gross Development Value was little better at just under 60%. Investors were offered a return of 9% pa over the 6 month term.

LendingCrowd

Lent to Date: £34,630,176 – fortnightly increase of £1,397,580 – 4.21% growth.

3 auctions came to the site on the day this blog was compiled.

Highlighted Loan: I invested in a loan of £189k to a picture framing business that has quite a large online presence last weekend. The capital was required to help with the set up of a new factory. The sum seemed high for it to be covered by such low value items as picture frame however both Annual Profits and Net Assets comfortable covered the amount being raised. I bid at 9% pa.

ArchOver

Lent to Date: £68,616,000 – fortnightly increase of £2,440,000 – 3.69% growth.

There were 4 auctions taking place when this blog was compiled.

Highlighted Loan: Demolition consultants were looking to raise £250k of Working Capital to assist the rapid growth of their operations. Security was provided by a charge over Accounts Receivable but, unusually for this site, there is no insurance cover therefore I felt the return of 7.25% pa a little on the low side particularly with this being a relatively new company and there was a risk that their growth plans may not come to fruition.

Platform News: ArchOver have launched their IFISA – the last of the major platforms to do so. They are not able to accept the transfer of existing ISAs at the moment but hope to do so in a few weeks.

CapitalRise

Highlighted Loan: CapitalRise listed the latest in their occasional loans secured against high-end Property Developments when they looked to raise £1.2 million to provide a Bridging Loan for a luxury 4 bedroom dwelling in Central London which has recently been renovated. The funding is required to repay the Development Loan while the sale process takes place. Although the security is billed as a First Charge over the property, this did not appear to be the case as one of CapitalRise's partners will provide the initial £2.8 million and CapitalRise's retail investors will rank behind them. This smells and tastes like a Second Charge to me and I would have been far happier if they hadn't ducked and dived behind their terminology. For this reason, and the fact that the LTV will be a hefty 72% on completion, I felt the return of 10.5% pa was too low.

PERSONAL P2P LENDING

Zopa

Lent to Date:  £3.33 billion – an increase of £40 million over the past 2 weeks – 1.22% growth.

Returns: Zopa's 2 accounts offer returns of 4.0% and 4.6% pa with the latter allocating some funds to riskier loans that offer higher returns.

Zopa distribute investor's money mostly to unsecured consumer loans.

Ratesetter

Lent to Date: £2.5 billion.

Ratesetter pass the £2.5 billion Total Lent milestone. According to the company this has been distributed to more than 460,000 borrowers. – individuals who have received more than £1.55bn and businesses to whom almost £950m has been allocated.

Returns: Interest rates are set according to supply and demand. They currently range from 2.8% pa to 5.0% pa depending on the length of the investment. These numbers are unchanged from a couple of weeks ago.

Capital is covered by a Provision Fund. Ratesetter proudly boast that no investor has lost a penny since they launched in 2010.

Lending Works

Lent to Date: £109,889,103 – an increase of £1,909,749 over the past 2 weeks – 1.77% growth.

Lending Works have passed the £100 million lent mark.

Returns: 4.5% pa and 6.0% pa via an IFISA or standard account for 3 and 5 year investments respectively. These have not changed over the past 6 weeks.

As well as a Provision Fund to cover investor's risks, this site also insures borrowers against redundancy, fraud, illness and accidents making this a very fair site for all concerned.

****Disclaimer: This blog contains the views of the Secret Investor. Your capital is at risk when lending via all P2P Platforms. You're recommended to speak to a qualified Independent Financial Advisor.