P2P Lending Platform News Round-up (28th July 2016)

Totals lent to date (28th July 2016)

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

LOANS TO BUSINESSES

Assetz Capital – £129,241,275

Funding Circle - £1,383,232,620

FundingKnight - £30,955,000

FundingSecure - £49,559,218

Money & Co –  £6 million approx

Rebuildingsociety – £10,138,421

ThinCats - £185,858,000

Invest and Fund - £1 million plus

LendingCrowd - £4.5 million

ArchOver - £19,677,000

PERSONAL P2P LENDING

Zopa - £1,420,000,000

RateSetter - £1,320,238,221

Lending Works - £31,451,245

…………..

LOANS TO BUSINESS

Assetz Capital  

Lent to Date: £129,241,275 – fortnightly increase of £11,385,102 – 9.66% growth.

After what appears to have been a slow start, June has been the busiest month on record for Assetz Capital with £11 million worth of loans funded. When this blog was compiled, there were 53 upcoming loans with 7 imminently due for drawdown.

Highlighted Loan: A borrower from East Anglia is looking for a bridging loan against the pub he owns to pay off the bank and refurbishment the property in question. The pub is currently vacant which is why a conventional mortgage is out of the question – this is expected to be put in place at the end of bridging loan when the tenants that are currently about to move in have built up enough of a track record to make such a facility possible. Given that the pub has a riverside location and relies on Summer trade, I wonder how much time the new tenants will have to generate enough cash to see them through the winter. On a positive note, the LTV when based on a vacant property is only 47% and the borrower has a substantial property portfolio to cover his role as guarantor but I feel a return of 9% pa is a little on the low side, particular with regards to the uncertainty Brexit poses to property values.

Managed Accounts: The following accounts automatically distribute investor's funds across the platform's loans and are covered by Provision Funds:

Quick Access Account (3.75% pa return); 30 Day Access Account (4.25% pa return); Great British Business and Green Energy Income Accounts (both of these offer a return of 7% pa)

Funding Circle

Lent to Date: £1,383,232,620 – fortnightly increase of £21,119,180 – 1.6% growth.

The fortnightly average remains at £21 million. There were 26 auctions ongoing when this blog was compiled. Secret Investor's Activity: This remains the site which I have the most exposure to because they have the largest number of loans listed.

Below are highlights from my activity in the past fortnight:

Highlighted Loan Invested in:

Loan of < £79k to enable a farm to buy more cows (C risk rating, 11.9% pa return). Profitable business and borrower advises that the profit from the additional milk yield will cover the cost of the loan.

Highlighted Rejected Loan:

Growth loan of £51k to business consultants (C risk rating, 11.9% return): The request was very vague with lots of jargon. The loan appeared to be required for a marketing campaign to expand the business but the balance sheet seemed a little thin to support to the loan should the campaign be unsuccessful.

Defaulted Loans Update: Loan to solicitors was defaulted last week – I had £33 of exposure. One of the guarantors is entering an Individual Voluntary Agreement while the other is waiting for funds to be available from his pension so that he can repay his part of the obligation. Two more loans defaulted this week due to companies going bust. One of these, to a jeweller with whom I have £52 outstanding, dates back over 2 years and is a B rated loan on which I only earnt 9% pa – a rate I could obtain on a secured loan via Assetz Capital. For this reason, I only invest in C rated and above loans through FundingCircle nowadays. The other loan was C rated to a media business, before recoveries, my losses are only £14 on that one. I would still prefer no losses at all. It has not been a good fortnight for my Funding Circle investments.

Platform News: Borrowers on FundingCircle now accept their contract before the loan is listed on the site. This means the loan becomes active as soon as it is fully funded so the investors' capital is earning interest sooner than previously. This also avoids that situation where loans were rejected by borrowers after investors had provided funds which was happening in 15% of the cases.

FundingKnight

Lent to Date: £30,955,000 – average fortnightly increase of £0 – 0% growth.

There were 0 auctions ongoing when this blog was compiled.

FundingSecure

Lent to Date: £49,559,218 at the end of June. Monthly growth of £5,771,325 (13.18%).

Total lent to date is updated monthly.

There were 9 auctions ongoing when this blog was compiled.

Highlighted Loan: Recently listed was a bridging loan of £180k to enable a borrower to purchase a commercial property that is leased to a restaurant. As the borrower has an interest in the restaurant, FundingSecure wisely calculated the LTV ratio based on the value of an empty property. Even with that, the LTV was a very re-assuring 45%. With a conventional loan expected to be put in place at the end of the 6 month term, I was happy to invest at a rate of 12% pa.

Defaults: I have two unredeemed loans as FundingSecure call those loans which the borrowers have not repaid on maturity. On one of these, the carpets held as security have been sold but FundingSecure have been waiting a month to receive payments from the buyer much to the frustration of all. The other is one of FundingSecure's first bridging loans which had a boatyard offered as security. This has been something of an ongoing saga, the latest is that the borrower is trying to arrange a refinancing package.

Platform News: FundingSecure now start paying interest from the date bids are made in auctions. Even if a loan is cancelled before it is drawndown, interest will still be paid. This is great news for investors from one of my favourite sites.

Money & Co

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

When this blog was compiled there was 1 auction taking place which was to fund the takeover of the financial planning and advisory business that was featured in the previous 2 blogs. A second loan was listed to facilitate this transaction to replace funding that was previously to be provided by another institution and, as such, does not represent additional indebtedness supporting the overall transaction. However, one wonders why the other institution has withdrawn support.

Platform News: Money & Co themselves have received an injection of capital from a Chinese development company. This is to fund the growth of the platform.

rebuildingsociety

Lent to Date: £10,138,421 – fortnightly increase of £25,030 – 0.25% growth.

The second half of June was much quieter than the record breaking first half for ReBS. There was 1 active auction when this blog was compiled, this was featured in the previous blog and was to fund the takeover of a car parts business. The auction has been extended as ReBS are hoping to bring in individuals who can increase the capital available for investment on the site.

ThinCats

Lent to Date: £185,858,000 – fortnightly increase of £1,858,000 – 1.01% growth.

When this blog was compiled… the ThinCats site was undergoing essential maintenance and the auction listings were unavailable.

Platform News: ThinCats are planning to list loans to social enterprises. As well as helping community projects, UK based investors can receive tax relief.

Invest & Fund

Lent to Date: Over £1 million

There was 1 auction taking place when this blog was compiled – although it was on the brink of closing.

Highlighted Loan: The loan that closed today was an extension of existing funding that had been used to purchase a house that was to be demolished and replaced by a 3-storey blocks of flats. The purpose of the extension was to finance the development of the site. A return of 9% compares well with similar deals listed on Assetz Capital although a lack of throughput makes it difficult to diversify via Invest & Fund.

Platform News: Shortly after the last blog went to press, Invest & Fund reported that they had 6 loans in the pipeline.

LendingCrowd

Lent to Date: Over £4.5 million as of the end of January.

There were 3 auctions taking place when this blog was compiled. The number of attractive loans listed on this site continues to increase.

Highlighted Loan: Publican was looking to raise £47k to purchase a second pub. They expected to double their income through having a second premise. LendingCrowd gave a high risk rating of C+ possibly due to the borrower only just moving from being a sole trader to a limited company. I invested half my usual amount at a return of over 14% pa.

ArchOver

Lent to Date: £19,677,000 – fortnightly increase of £470,000 – 2.45% growth.

There were 0 auctions taking place when this blog was compiled.

INVESTUP PORTFOLIO

Despite listing loans from numerous platforms, there were only 9 auctions taking place today. Many were from sites covered elsewhere in this blog – reBuildingSociety, ThinCats and ArchOver.

PERSONAL P2P LENDING

Zopa

Lent to Date: £1.42 Billion – latest figure available.

Returns: Zopa's 3 accounts offer 3.5%, 4.3% and 6.7% pa depending on the levels of access and whether or not they are covered by the Provision Fund. Zopa distribute investor's money mostly to unsecured consumer loans.

Ratesetter

Lent to Date: £1,320,238,221 – fortnightly increase of £21,467,789 – 1.65% growth.

Returns: Interest rates are set according to supply and demand. They currently range from 3.0% to 5.7% depending on the length of the investment. These figures tend to fluctuate by no more than a few decimal places. Capital is covered by a Provision Fund. Ratesetter proudly boast that no investor has lost a penny since they launched in 2010.

Platform News: Ratesetter have announced that they expect future defaults to increase by 24%. They provided assurances that the Provision Fund will still prevent investors from incurring losses but only by changing the calculations to include expected future payments into the scheme.

Lending Works

Lent to Date: £31,451,245 – fortnightly increase of £633,760 – 2.06% growth.

Returns: 4.7% and 5.7% for 3 and 5 year investments respectively and are unchanged compared to a fortnight ago. As well as a Provision Fund to cover investor's finances, 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.