boundah
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Post by boundah on Dec 7, 2018 16:04:16 GMT
"Defaulted" is just a word. There are loans which have been suspended because they're behind. There are loans where the borrower has been put into administration or bankruptcy by Lendy. There are loans where the security has been exercised. There are loans where the security has left a shortfall, and legal action is being taken. I'm not aware of any loans where that legal action has been abandoned... So where in that lot do YOU put the "default" line? (...)
The linked article makes the point even more clearly: the P2PFA have suggested 120 days, but platforms are not obliged to follow this. So for example: 'Lendy, formerly known as Saving Stream, is in default if the amount owed is not paid within 180 days, which the platform calls a tolerance period'. Without wanting to prolong the debate, I use the HMRC SAIM12000 offsettable losses definition: borrower in administration or receivership. This also makes it easier to fill in the tax return, as I just have.
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adrianc
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Post by adrianc on Dec 7, 2018 17:01:46 GMT
He's a busy boy, Liam.
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Balder
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Post by Balder on Dec 7, 2018 17:07:55 GMT
Now called a recovery programme as well
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star dust
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Post by star dust on Dec 7, 2018 17:09:13 GMT
Mod Hat On/ To be fair to Mr_N , I had moved their earlier post into the existing thread as I also thought it didn't warrant a separate one. I guess it's possible they didn't notice and so decided to start another thread all over again. However, I agree with other posters in this resurrected thread, and so will merge it into the existing one and rename slightly. Perhaps Mr_N could delete one or the other or both their posts. 
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invester
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Post by invester on Dec 7, 2018 17:28:44 GMT
So Robert Kelly (COO) and Kieran O'Connor (CFO) didn't last long did they? Why did they leave, did they jump, or were they pushed?
The intentions are noble but after an initial bout of enthusiasm I think they will go back to blanking everyone again. Some of the bad loans are just not that easy to sort out.
The interesting thing is that they said they had engaged specialist agencies to review the loan valuations. I hope they take this seriously and this is not window dressing. Get latest valuations, preferably from more than one firm, and be transparent and share the valuations even when they are adverse. I would think that some existing loans might get suspended off the back of it.
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Carter
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Post by Carter on Dec 7, 2018 17:31:31 GMT
I'm kind of a bit staggered that an organisation would actually write that. It is essentially an admission of serious leadership and management failure. Its one thing for people to think it, but its quite another for the target organisation to say it. Reads to me like they might have been forced to send it by the FCA.
No financial business would highlight the fact compliance needs improving without being forced to do so.
I think you're right reinvestor wrt fca influence on these series of communications and org restructuring steps. There appears to be plan to reset and recover the company with the ceo front and centre and demonstrating some leadership. Time will tell.
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Post by ajscotland on Dec 7, 2018 17:47:55 GMT
Irrecoverable Loans: Source www.gov.uk/hmrc-internal-manuals/savings-and-investment-manual/saim12050When does a peer to peer loan become irrecoverable? A peer to peer loan may be accepted as having become irrecoverable when there is no reasonable prospect of the recovery of the loan. When assessing recoverability, the funds available and potentially available to the borrower must be considered. A claim therefore cannot be established simply because the borrower has insufficient liquidity on the date the loan had been called in. Whether a loan has become irrecoverable should be judged on a case by case basis, however as the loan will be managed by a platform, the platform would usually be in a position to determine when a loan has become irrecoverable. The platform would then inform the lender that the loan had become irrecoverable. If the platform does not undertake this action, then the lender may still determine that the loan has become irrecoverable. However it will be the responsibility of the lender to show that there is no reasonable prospect of the recovery of the loan and it is NOT simply a case of late payment. When is a peer to peer loan treated as irrecoverable? Under the legislation for income tax relief for irrecoverable peer to peer loans in certain circumstances a loan may be treated as irrecoverable for the purposes of the relief even if there may be a prospect that the lender could recover some of the amount outstanding. This is the case for the following situations: - Loans with security : When loans are made against security, a loan may be treated as becoming irrecoverable as if the security did not exist. - Loans where legal recovery action is taken: When the borrower has entered legal recovery procedures such as liquidation, administration, receivership or bankruptcy the loan may be treated as becoming irrecoverable as if such action was not available. Subsequent Recoveries : If a loan has been treated as irrecoverable in either of the scenarios outlined above then the relief will be given at the point where the loan becomes irrecoverable other than for the specified recovery actions. If any value is then recovered, either through these actions or by any other means, then this recovery would then be taxed as additional interest received by the lender. This is the same treatment as any other subsequent recovery of a relieved irrecoverable loans (more detail in Subsequent recoveries). |
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nyneil
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Post by nyneil on Dec 7, 2018 17:50:50 GMT
So Robert Kelly (COO) and Kieran O'Connor (CFO) didn't last long did they? Why did they leave, did they jump, or were they pushed? The intentions are noble but after an initial bout of enthusiasm I think they will go back to blanking everyone again. Some of the bad loans are just not that easy to sort out. The interesting thing is that they said they had engaged specialist agencies to review the loan valuations. I hope they take this seriously and this is not window dressing. Get latest valuations, preferably from more than one firm, and be transparent and share the valuations even when they are adverse. I would think that some existing loans might get suspended off the back of it. "The interesting thing is that they said they had engaged specialist agencies to review the loan valuations." Maybe that means they will be having, shall we say, "discussions" with the original valuers, or their PI insurers.
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invester
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Post by invester on Dec 7, 2018 18:14:59 GMT
IMO it means feck all.
What I don't quite get is that simply appointing new people does not count as governance, not in a corporate sense anyway. A series of events from the past year has only led me to believe that governance is fairly poor at the company, and that comes from the top.
What happened to Nigel Boothroyd? He was supposedly a non-exec director that joined in August, but he is not featured in this new board. The merry-go-round of staff is slightly concerning, especially positions near the top which only stay filled for a matter of months.
IMO I think the problem is Liam. If he stepped aside, a new CEO could come in and do a 'kitchen sink' job, then you have one team dedicated to recovery and one team actually making new business to regain trust. Unfortunately I ain't so sure that Lendy could afford a the type of 'transformational' year that this demands.
It seems that even Lendy are starting to admit their failures through gritted teeth, calling it a recovery where in fact it has been a series of quite big f--- ups that have reduced investor confidence to nothing.
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adrianc
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Post by adrianc on Dec 7, 2018 18:22:36 GMT
Which is clearly a VERY long way from simply being 120 days past due.
Going back to the rogue's gallery that is the "Claims underway" tab, I'd go so far as to suggest that only PBLs74 and 147 appear close to that line, depending how much the TiB thinks can be raised in the future. And they're both 100%-capital-repaid.
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rocky1
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Post by rocky1 on Dec 7, 2018 18:54:23 GMT
all this just does not sound like liam()or lendy. i reckon there has been some intervention from somewhere.lets hope we start seeing some results now they have some big guns on board the lendy ship.never did like the look of that kelly fella anyway to smarmy and shifty.
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Post by brightspark on Dec 7, 2018 19:21:51 GMT
Yes. More waffle. Why have they been sitting on their backsides for the previous 18 months when all around them were saying extract digits? maybe the money is running out?
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Post by queenvictoria on Dec 7, 2018 20:04:46 GMT
I think we should give this a chance. Three updates in three days is good and the tone suggests that Lendy is proposing to turn a corner. The proof will, of course, be in the detail that does or does not come next both on a corporate and individual loan level.
I was pleased to see details of the new Board but surprised and disappointed that there no non-execs included. One or perhaps two independent, non-executive directors would surely strengthen the Board. I hope this is to follow in time.
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sussexlender
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Post by sussexlender on Dec 7, 2018 22:34:10 GMT
Reality check 07.12.2018 for the CEO of Lendy.
Zero (0) Pipeline loans
33 Live loans with £279 m asset value and £88m provided to borrowers (5 partially repaid)
35 Admitted Non performing loans - mainly at 12 % with between 2.22 - 2.96 % bonus interest (not guaranteed).
204 days = shortest failure to make repayment of capital and any interest.
814 days = longest failure to make any repayment of capital and any interest.
£159m - Claimed asset values of the Non performing loans, based on the Lendy valuations accepted by them and then used to promote these 35 loans to investors.
£82,949,441 Amount currently admitted as outstanding / over 120 days failure by the borrower to make any repayments on these 35 loans.
£9,953,932 At 12% pa = the amount due to investors by way of interest payable on a full 12 month loan period (not including Capital repayments).
£829,494. Assuming 12% pa = average monthly amount of the interest due on these 35 loans that Lendy has failed to collect and pay to investors just this month alone.
The recent easy to write "apology" e mail fails to mention any figures. If it is an attempt to make investors feel sorry for the CEO and his "highly experienced" team at Lendy it has failed.
Active investors using this platform will recall that Funding Circle claimed to have a "highly experience property team" dealing with numerous defaults just before they killed them off (and their inhouse forum) and stopped taking property loans entirely.
Some might think the apology e mail it is a classic example of "blue sky thinking". It falls short of admitting the obvious incompetence by Lendy over a very long period of time to protect investors cash and / or to oversee these 35 projects, whilst also ignoring the fact that they have received substantial fees from the borrower in each case.
The new 5 core issues specified by Lendy's current CEO fail to accept the obvious failures over a substantial period of time to carry out full DD on borrowers and / or their assets.
The apology introduces 3 variations of the activity of repayment whilst omitting the important words failure to repay i.e. "slow pace of repayments"; "delays on repayments" & the all new "deferred repayments".
Have any investors been consulted in connection with accepting "deferred repayments"?
Investors do not want or need an apology, they want action to get their Capital back at the very least.
Meanwhile, the shambles that is the management team at Lendy continue to accept any old stalling tactic / excuse from many of these borrowers.
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Mr_N
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Post by Mr_N on Dec 7, 2018 23:46:48 GMT
Not sure what your point is? They called for a common definition but it hasnt really been adopted outside of their limited membership. However, one non-member has adopted it ... Lendy! Collections & Recoveries Policy
IMHO a loan is in default if it is outside its agreed terms ie one or more of overdue interest (7 days), past term, breach of covenant, in recovery and has been defaulted if the platform has formally issued demand for repayment but that is more strict than the P2PFA definition. Whether a platform defaults a loan is discretionary and based on circumstance.
I also dont like the fact that Lendy doesnt use the HMRC bad debt 'treatable' definition, sticking to the 'become' one. That will be one point I will be raising in response to Liam's email. (Not the first time, some of us of been poking Lendy for a while now)
read it this time.
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