Retail investor money in p2p lending has been slowly eroding for the last few years, but the UK’s p2p lenders...
RateSetter's Provision Fund is a capital reserve that helps ensure investors get paid principal and interest even if loans default; currently the fund is valued at £22 million; with the company projecting future losses via default of £18 million, the "Provision Fund coverage" ratio is roughly 120%; now, the firm has begun publishing a "capital coverage ratio" that combines the reserve funds with the expected interest payments on the loans, then divides by expected losses; with £30 million in interest payments expected, added to the £22 million reserves, the capital coverage ratio is nearly 3x; RateSetter said the newly published ratio is more fair when comparing RateSetter's assurances against other online lenders that don't hold a reserve fund but that still calculate coverage of potential losses. Source
RateSetter has added additional detail to its annual performance statistics to provide greater transparency; the additional details provide data on loan originations by lending type with a breakdown of consumer and commercial loans; for commercial lending the firm will now also disclose loans to property developers, small and medium size enterprises, and wholesale lenders; the changes were prompted by a request from the Financial Conduct Authority for greater disclosure on wholesale lending across the industry; the update from RateSetter also included a report on a defaulted loan that RateSetter has taken onto its balance sheet to protect investors. Source
RateSetter has sold non-performing debt to debt purchaser 1st Credit; source says the sale was for 2.1 million British pounds ($2.6 million) of non-performing loans originated between 2010 and 2015; the sale goes beyond the company's standard plans for default collection and coverage which include support from one of the industry's most well-known provision funds; the RateSetter Provision Fund promises to cover defaults for borrowers and is valued at approximately 22 million British pounds ($27.2 million); with expected losses of approximately 19 million British pounds ($23.5 million) it currently has a coverage ratio of 118%. Source
Metro Bank is in talks to acquire one of the largest p2p lenders in the UK in RateSetter; according to...
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The round was led by Five V Capital, who reportedly invested $8.5 million; company plans to boost number of employees from 50 to 80 in the next year; RateSetter Australia has doubled is loan levels since 12 months ago; Daniel Foggo, RateSetter chief executive stated, “In August, we became the largest peer-to-peer lender in Australia — both in terms of the number of lenders, and the number and value of loans funded each month.” Source
According to the Liberum AltFi Volume Index, September 2016 originations for online lenders hit £364m in the UK. September was...
RateSetter has created a new committee to monitor and report on expected losses providing increased transparency for the firm; the committee will include RateSetter's CEO, CFO and various other directors of consumer and commercial credit risk; the committee will provide quarterly reporting on expected losses for the board of directors and also plans to publicly disclose data on its website; additionally the firm plans to enhance its performance reporting with more details on materialized and expected losses; overall, new initiatives around risk monitoring are an effort to more accurately analyze and manage risk following higher than expected losses from loans in 2014 and 2015. Source
Funding Circle lead originations for the month of September followed by Zopa and RateSetter; many other originators across Europe are included in the list. Source