why the difference?

Hi hendragon,

The circumstances are quite different for these loans. In general terms when a loan becomes non-performing, we will look at the best way to resolve the situation and if necessary, recover lenders' funds. That sometimes means quick decisive action and the appointment of an administrator, such s for MTAS934. In that case it was our view that the borrower did not have the ability to resolve the situation and we needed to step in.

In the case of MTBA822, we believe the best route is to recovering funds is to let the borrower do what they planned to do. The end is in sight and there is a future income stream there; the building has been improved since the last valuation and the security remains strong. Once open, the loan profile improves dramatically. The borrower is heavily invested and committed to the project; we have seen evidence he has taken steps to access his other funds to service the interest. This is in progress now. However, we're keeping a very close eye on the situation and we won't hesitate to step in if a) the opening is subject to further delay or b) interest is not served shortly. 

Acting as agent always involves an element of judgement and a balance between lender and borrower interests. Overall, many lenders lend on our platform to support British businesses as well as earn interest. I think it's part of our role to understand the borrower's circumstances if their situation changes and try and support them if we can. No one likes the stories of lenders foreclosing on businesses at the 11th hour. That said, sometimes that is absolutely the right action to take. It's a judgement call and one that I think we get right most of the time.

One thing we don't do- and we've demonstrated this over the past months- is to push problems down the line. If we've extended the loan it is not to stick our heads into the sand, it's for a legitimate reason. 

Hope that helps. 

Kind regards

Sophie