End of the lock-down – Stable returns continue with 0.6% in June 2020

Figure 1 Performance of Note price and Long-Term Return Target

Update on crowdlending market situation

Volumes in crowdlending have been stabilising during June, but at much lower levels. The best loan originators have significantly reduced their offering of loans on the platforms coursed by two factors: Firstly, less demand from borrowers and secondly tightening of credit process.

This has resulted in lower interest rates on loans offered in the market. We expect this will continue until volumes again starts to increase.

Monthly comments

The interest payments received in June was in line with expectation and slightly higher than in May. The opportunities to buy in the secondary market at discounted rates has almost dried up during the month.

Current loans were at the end of June 76.9% of the value of the portfolio, an increase of 2.1%-points. At the same time loans more than 60+ days late increased just under 0.2%-point to under 3.5% of the value of the portfolio.

This month we have not taken any additional provision on loan originators since one of the two loan originators, where we previously has taken a provision, has restarted their payments. On property loans, we have taken a provision of 0.1% of the value of the portfolio.

However, we have able to reverse a previous provision on a property loan equal to 0.07% of the value of portfolio and additional 0.03% of the value of portfolio on consumer loans has also been reversed.

All in all, this gave a return of 0.60% for the month of June 2020.

Since inception, Quantrom P2P Lending has given a return of 29.44% and outperformed the long-term return target by 6.26%-points.

Portfolio

The portfolio at the end of June 2020 consisted of almost 8,500 loans. The weighted average interest rate on the portfolio is 11.25% with an average weighted maturity of 28.4 months.

The main exposure in value is still towards Car Loan which we increased to 58% of the value of the portfolio at the end of the month.

Exposure towards property loans is at 24% of the value of the portfolio. At the end of March, personal loans represented 17%, while business loans were at 1% of the value of the portfolio.

Figures 2-12 provide more details on the composition of the loan portfolio.

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Quantrom Limited, Limerick

July 2020

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