beagle
Investor in ratesetter, funding circle, lendy (lesson learnt) and AC
Posts: 670
Likes: 322
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Post by beagle on May 28, 2020 22:17:38 GMT
RateSetter are you going to update the data page on time? last month it was late and we all deserve to get up to date data if we are passing 50% interest to the fund. you do a great job and it's showing but do please make sure your data is on time. otherwise don't wonder why people get mad with you I'm not sure RS answers direct questions on here they usually only use this location to make statements regarding the PF and more recently the daily sales volumes etc. Sometime they may answer but you would be better asking this directly by eMail or better phone them. They have until Monday I guess but correct me if i'm wrong wasn't there an adjustment last month to factor in the rate changes that affected the PF percentages and it may have been delayed due to those decisions perhaps. yes indeed they did but it was late and was a important update so given the climate I hope they stay up to date
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Post by RateSetter on May 29, 2020 11:31:02 GMT
Good afternoon. We have completed the usual monthly update of data on the statistics page, and alongside we have published the first monthly commentary on the temporary interest reduction. This can be found in the RateSetter Notices section of your account and is copied below for reference:
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johnt
Investing in Ratesetter, Zopa and Assetz Capital since 2013
Posts: 127
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Post by johnt on May 29, 2020 12:26:17 GMT
Good afternoon. We have completed the usual monthly update of data on the statistics page, and alongside we have published the first monthly commentary on the temporary interest reduction. This can be found in the RateSetter Notices section of your account and is copied below for reference: That's actually a lot better than I thought it was going to be. I was expecting a lot worse news this month.
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beagle
Investor in ratesetter, funding circle, lendy (lesson learnt) and AC
Posts: 670
Likes: 322
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Post by beagle on May 29, 2020 12:41:39 GMT
Good afternoon. We have completed the usual monthly update of data on the statistics page, and alongside we have published the first monthly commentary on the temporary interest reduction. This can be found in the RateSetter Notices section of your account and is copied below for reference: this is a good result given the situation. i expected far worse. a long way to go but so far it seems that in spite of the noise they managed to release nearly 50 million and have pretty solid people working there. my key interest will be on how the 50% impact the fund next month
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wapping35
Member of DD Central
Posts: 385
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Post by wapping35 on May 29, 2020 16:51:37 GMT
So looking back what this means:
Cash PF balance per RS was £5.84m April 1, 2020
The Debt sale added £4.65m so a total cash of £ 10.49m
Now the cash balance per the RS May 1 update is £ 7.82m.
So they went through £ 2.67m in cash in April.
So yes it certainly could have been far worse given it was April.
It will be interesting to see how the cash balance increases (or falls) with the June update and the cash inflow from our 50% interest rate hair cut..
W35
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jane
Posts: 145
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Post by jane on May 29, 2020 19:48:27 GMT
Good afternoon. We have completed the usual monthly update of data on the statistics page, and alongside we have published the first monthly commentary on the temporary interest reduction. This can be found in the RateSetter Notices section of your account and is copied below for reference: Can someone decipher this piece of Ratesetter blurb please. The way i read it, they are saying that they have fiddled the figures by adjusting a discount that they have always applied in the past to make the Capital Coverage Ratio look better.
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Post by Deleted on May 29, 2020 19:56:06 GMT
The Capital Coverage Ratio rose from 166% to 169%. This is explained by an increase in expected future investor interest – the latest analysis suggests the discount we have always applied to this figure (in order to reflect that some loans will repay early) was too high. Can someone decipher this piece of Ratesetter blurb please. The way i read it, they are saying that they have fiddled the figures by adjusting a discount that they have always applied in the past to make the Capital Coverage Ratio look better. I think that's probably fairly accurate. I think they're now assuming more loans repay later or run full term so will contribute more to the PF. When there's a change in assumptions, I believe they should disclose the effect of that change but that will never happen.
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aju
Member of DD Central
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Post by aju on May 29, 2020 22:56:55 GMT
I forgot to take a copy of the PF figures for last month (I think it appeared late on 5/5/2020) , does anyone have those figures by chance?. I thought I had copied it but I can't find it. I usually print the statistics to a PDF although I'm only really interested in the raw PF figures to be fair.
(Interest Coverage Ratio) Apr 2020 May 2020 (see Note) Provision Fund Cash 5,840,708 7,818,337 Exp Future Provision Fund Inflows 23,029,518 22,407,061 Prov Fund Buffer 28,870,226 30,226,397 Expected Future losses 39,238,936 41,139,804 Int Rate Cover 74% 73%
(Capital Coverage Ratio) Apr 2020 May 2020 (See Note) Prov Fund Buffer 26,870,226 30,226,397 Expected future investor interest 36,083,898 39,469,780 Capital Buffer 64,954,124 69,696,178 Expected Future losses 39,238,936 41,139,804 Capital Coverage Ratio 166% 169%
RS Note: Each page is updated in the last week of each month with data correct as of the start of that month.
Edit: Thanks to @freddie123 for supplying a jpg copy of the relevant data for Apr2020. I've updated the fields above for the record including both periods.
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Post by shanghaiscouse on Jun 8, 2020 7:53:48 GMT
OK so from what I can understand the problem with the provision fund is that (i) it is not actually funded, i.e. only about a quarter of it is cash, three-quarters is cash expected to be received in future (how far into future I wonder?) and (ii) their target for it is 125%, its now at 73% but will increase as the 'temporary reduction' kicks in. The problem I can see here is that the expected future losses number has not been flexed to adjust for C19 losses. Once the various furlough, forbearance, grants and other forms of free money evaporate and taxes go up to pay for all this free money, then the expected future loss could go up dramatically. So I can only see upside risk to the losses, which have a multiplier impact on the future inflows to the provision fund, and downside risk to the fund, which in fact should be called a provision, not a fund at all, it's two different things.
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Post by shanghaiscouse on Jun 8, 2020 7:57:46 GMT
Also, is the calculation of capital coverage not double counting the interest element of the fund? Let's imagine you have a 5 year loan of originally 10k, paying 1k of interest a year, which goes bad half way through. So there would be a £5k capital loss and £2.5k of interest lost. So after taking the 2.5k out of the provision fund to cover the lost interest, the provision fund available to cover the capital loss should be 2.5k lower. But in these calculations the interest cover provision is also shown as being fully available for capital loss. Am I missing something here?
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elliotn
Member of DD Central
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Post by elliotn on Jun 9, 2020 2:19:09 GMT
Also, is the calculation of capital coverage not double counting the interest element of the fund? Let's imagine you have a 5 year loan of originally 10k, paying 1k of interest a year, which goes bad half way through. So there would be a £5k capital loss and £2.5k of interest lost. So after taking the 2.5k out of the provision fund to cover the lost interest, the provision fund available to cover the capital loss should be 2.5k lower. But in these calculations the interest cover provision is also shown as being fully available for capital loss. Am I missing something here? For a defaulted loan, a funded PF would cover the capital loss/unpaid interest to date (which should have been made whole monthly) but not missed future interest. Depending on your settings the repaid capital would be invested in new interest bearing loans, you wouldn’t double dip on interest from the redeployed capital (altho it would accrue to the PF from any sufficient recoveries).
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Post by shanghaiscouse on Jun 9, 2020 9:13:26 GMT
ah ok, thanks. So in my example, the interest was paid up to date so the provision fund would not be touched for the interest. If, say, £200 of interest had not been repaid (overdue) then that £200 would come out of provision fund, but the future interest would not be. So in the case of a capital default you lose both the capital and all the unaccrued interest, but should get the accrued interest less interest actually received from the provision fund.
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Post by peertopier on Jun 9, 2020 12:37:03 GMT
Also, is the calculation of capital coverage not double counting the interest element of the fund? Let's imagine you have a 5 year loan of originally 10k, paying 1k of interest a year, which goes bad half way through. So there would be a £5k capital loss and £2.5k of interest lost. So after taking the 2.5k out of the provision fund to cover the lost interest, the provision fund available to cover the capital loss should be 2.5k lower. But in these calculations the interest cover provision is also shown as being fully available for capital loss. Am I missing something here? Yes. Having look at how the scheme works and thought about it for a few days my conclusion is that the provision fund ratios are not the simple thing they claim to be. Capital and interest are entwined. That percentages are nothing more than the ratio of some predicted future numbers based on a various assumptions. If your money ends up in a loan that goes bad and the provision fund pays you something then you won't be bothered if the money is treated as interest or capital, you'll just want some money back.
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Post by james91 on Jun 29, 2020 15:46:36 GMT
Are we likely to get an update today?
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Post by Deleted on Jun 29, 2020 15:56:25 GMT
Should be today or tomorrow.
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