kulerucket
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Post by kulerucket on Jun 22, 2018 6:26:29 GMT
One point that stuck in my mind which I was not aware of was the statement that all loans are due for repayment by November 2018 which of course is only 5 months away. According to the records I exported using a web scraper, there is at least one going beyond this date. Not too much longer though. E.g: BL00074-1 E** V****** at N***** K*******, D***w**** (1 of 4) ACC00120 - 12/12/2018 BL00081-1 O****** H***, O****** R**d (1 of 4) - ACC00148 - 11/01/2019
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JamesFrance
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Port Grimaud 1974
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Post by JamesFrance on Jun 22, 2018 6:38:05 GMT
Confirmation that investor's funds and loans are trust assets should mean that the P2P Lending industry has a future, which seemed to be doubtful after the original BDO plan to treat investors as creditors of the platform.
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IFISAcava
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Post by IFISAcava on Jun 22, 2018 6:43:13 GMT
Page 11 and 12 certainly makes me feel better this morning, and one big finger up to the data providers who said no cheese! I also note comments that the fca and col were in protracted discussions, contrary to what the fca were claiming that they knew nothing until after shop was shut from comments on other threads? Regardless, i am much more hopeful. Agree, I noticed this too - although would be better if this were quantified (weeks? months?).
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IFISAcava
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Post by IFISAcava on Jun 22, 2018 6:50:32 GMT
Good news that client monies and drawndown loans will be trust assets.
It's the undrawn/unfilled loans that will be most problematic without the full reconstituted electronic records, I think, and may lead to inequitable outcomes in the absence of records (e.g. that money may be lost first to administrator fees).
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IFISAcava
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Post by IFISAcava on Jun 22, 2018 6:51:57 GMT
Is cash held in client accounts treated as a trust claim or unsecured creditor claim? they are saying a trust claim
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rxdav
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Post by rxdav on Jun 22, 2018 6:57:19 GMT
Well this does look promising - but like many I suspect I've yet to fully absorb all the detailed implications of the report - but the fundamentals seem sound and a decent recovery now looks a genuine prospect - albeit no time soon (only to be expected).
As I suspected though - it looks increasingly like the FCA are not exactly going to be come out of this smelling of roses!?
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james21
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Post by james21 on Jun 22, 2018 7:06:09 GMT
Initial read indicates extremely positive progress. I'm satisfied that the administrator is doing the right thing. We should get much of our money back, but almost certainly not 100%. Looking at the administrator fees, I'm in the wrong business... * The mention and separation of investor and creditor. * That servers have been located and steps to securing the data are in play. * A pre-filled proof of debt expected to be sent out to "each investor" (or should that be "ready filled" :-) * £70k administrator charge for the 3 month period (!!). £533k total fee estimate * Contact details for investors is secure, and their total loan amounts and cash balances. Total cash balances, however, do not agree with the balance in the client account (~1MM). * Investor's specific loan information is not available, and this is what's being sought from the 3rd party servers. * Administrator are in contact with the previous directors (they aren't AWOL) * Are investors classed as creditors? - Pg 14. It appears that loans are protected via trust for the most part, and cash and shortfall to be classed as creditor. My take is that we should likely receive 70% (average LTV) +/- valuation fudge +/- non fire-sale price. Can someone else share their view on this?* Estimated outcome for investors. Pg 15. Unlikely to see return of full investment, due to the estimates creditor(sic) claims exceeding the asset book value* £17.0MM assets. £17.5MM liabilities. £500k estimated deficiency. -£500k costs = 94% liability coverage. (Appendix 2) registerme , feel free to merge into your post if preferred Yes a £500k deficiency and £500k costs but £17m loan book and assuming just 10% interest to be paid by the borrowers that gives £1.7m interest per annum to cover the deficiency and costs. So far I cant see any mention in the report of projected interest income
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ceejay
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Post by ceejay on Jun 22, 2018 7:26:29 GMT
... Yes a £500k deficiency and £500k costs but £17m loan book and assuming just 10% interest to be paid by the borrowers that gives £1.7m interest per annum to cover the deficiency and costs. So far I cant see any mention in the report of projected interest income £1.7M PER ANNUM - most of the loans have a lot less than a year to run. Expect a small contribution to the shortfall, but don't get carried away. And don't expect 100% loan recovery either - we weren't getting 12% interest for nothing!
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invester
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Post by invester on Jun 22, 2018 7:32:35 GMT
Having skimmed it I believe that they will email individual investors with an estimate of what they are owed, so there is no need to email them? Since it went down the tubes I have changed address, would i need to advise them on this?
Hopefully the data can be recovered - it seems quite concerning that the directors did not give a damn about preserving it - it would have been manifestly very easy to keep backup data elsewhere and I question their motives for not doing so.
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pikestaff
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Post by pikestaff on Jun 22, 2018 7:49:09 GMT
Is cash held in client accounts treated as a trust claim or unsecured creditor claim? The status of all claims is subject to confirmation. With that caveat:
Cash in client accounts is a trust claim. The report indicates that cash which should be in client accounts but isn't may also be a trust claim.
The position re specific loans is more interesting. The present view is they are trust assets, but they don't yet know if they will have enough data to reconstruct all claims. This is mainly because the data was deleted and they are resorting to forensic techniques to recover it. BDO say that "for investors to pursue trust claims they will need to be able to identify the specific loans (or loan tranches) into which they invested" [page 14, penultimate para].
The implication is that any trust assets that are unclaimed (because of lack of info) will fall into the unsecured creditor pot. I think this may also apply to cash in client accounts to the extent it cannot be identified to an individual lender. I think this is a key area where thinking is likely to develop over time and where input from the proposed creditors' committee will be important, including on - where to draw the line between the two pots in the face of imperfect/incomplete data (eg where lenders have partial records), and
- how much imperfection to accept, ie how much to spend on reconciliation and forensics before the cost exceeds the benefit?
I also think it's a bit too simplistic, probably because they've not yet fully thought it through. There's a comment that lenders with trust claims will also have a claim as creditors for any shortfall on their loans. Rightly so. But it would be unfair for the rights of those lenders who cannot prove their claims to be diluted by the shortfall claims of those lenders who can.
I think that even if BDO are unable to reconstruct the whole book they should (quite soon) be in a position to reconcile and agree lenders' claims in aggregate, analysed between loans (in total) and cash. I think those aggregate claims should be treated as trust claims, which will either be specific (where lenders' specific loans can be identified) or general (where they cannot). The problem with this is that, if I am right, only lenders with claims to "good" assets will be motivated to prove their claims. Other lenders will be happy to be in the general pot. Something else for the creditors' committee to think about...
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gc
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Post by gc on Jun 22, 2018 7:50:36 GMT
Having skimmed it I believe that they will email individual investors with an estimate of what they are owed, so there is no need to email them? Since it went down the tubes I have changed address, would i need to advise them on this? Hopefully the data can be recovered - it seems quite concerning that the directors did not give a damn about preserving it - it would have been manifestly very easy to keep backup data elsewhere and I question their motives for not doing so. Couldn't agree more. I wouldn't say that the directors don't give a damn about preserving the data and believe they do/did have backups. If they don't then it is too handy in this situation and would have been removed intentionally. I may sound paranoid but as I used to work as part of an IT team on a banking site and I can't imagine anyone not having a policy in place to back up data (making certain data disappear is another thing)
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james21
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Post by james21 on Jun 22, 2018 8:04:04 GMT
... Yes a £500k deficiency and £500k costs but £17m loan book and assuming just 10% interest to be paid by the borrowers that gives £1.7m interest per annum to cover the deficiency and costs. So far I cant see any mention in the report of projected interest income £1.7M PER ANNUM - most of the loans have a lot less than a year to run. Expect a small contribution to the shortfall, but don't get carried away. And don't expect 100% loan recovery either - we weren't getting 12% interest for nothing! Page 9 shows receipts into client accounts march and april were £87k (this is interest) on that basis over a year it gives £522k interest, this is a big shortfall on interest indicating not all borrowers are paying interest (as BDO indicated in the FAQ). I know not all of the loan book will run for a year. Borrowers have to pay back the loan and interest that is their legal obligation. Its not clear to me whether its in BDO scope to recover this back interest on loans (as well as capital) that are due to be repaid during the admin period. But in any event the loan book that has yet to expire will be passed to one or more platforms to manage to expirity. The interested platforms cant propose anything until they see the loan book and BDO have yet to piece it together. During the period of administration any loans that have been repaid will either be held on account and not paid back to investors that invested in them or paid back without interest, probably held. I am still seeing a full capital recovery over the lifetime of the loans plus over runs less defaults which all platforms get. I think lender interest will pay for the administration and creditors . All speculation and much information is yet to come to hand but so far I am happy with what BDO are doing
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11025
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Post by 11025 on Jun 22, 2018 8:04:17 GMT
I couldn't see anything relative to the £340K taken by the directors from February ,
Anybody know if this is this still an issue or was it misappropriated earlier ?
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archie
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Post by archie on Jun 22, 2018 8:23:05 GMT
Report is also now available on the website. |
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averageguy
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Post by averageguy on Jun 22, 2018 8:35:00 GMT
Who's going on the Creditors Committee?
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