alibaba
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Post by alibaba on Nov 18, 2019 21:35:24 GMT
Where in my post does it say that
I don't think that they should be closed to new investors.
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bg
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Post by bg on Nov 18, 2019 22:33:31 GMT
Where in my post does it say that I don't think that they should be closed to new investors. Oh sorry, it's just a thread about the accounts being shut to new investors and you seemed to be taking objection to it with comments like:- If you agree that it's a good move to shut the accounts then great but it does leave me wondering what exactly you're objecting to and what you think is being erased.
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JamesFrance
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Port Grimaud 1974
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Post by JamesFrance on Nov 19, 2019 9:51:18 GMT
Maybe wrongly I invested in GBBA2 assuming that large allocations of some loans would be reduced as new loans were added and more investors arrived, hopefully before they had time to become a problem. Presumably this will not be happening now and we will be stuck with large amounts of loans for which there is no demand, so diversification is being destroyed by this closure.
This is not what I expected when I invested in this account and I feel I have been misled.
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zlb
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Post by zlb on Nov 19, 2019 13:26:31 GMT
Maybe wrongly I invested in GBBA2 assuming that large allocations of some loans would be reduced as new loans were added and more investors arrived, hopefully before they had time to become a problem. Presumably this will not be happening now and we will be stuck with large amounts of loans for which there is no demand, so diversification is being destroyed by this closure.
This is not what I expected when I invested in this account and I feel I have been misled. Thinking out loud, do you think there is room for a change in regulations over this kind of thing? Can you see a way where investors in this product could be integrated into another AC product? There have been changes on other platforms where terms and conditions were changed with no option of lender escape. Perhaps platforms should only offer products which could be dismantled or rolled into a different vehicle if it 'goes wrong', rather than leave the sort of risk that you describe?
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bg
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Post by bg on Nov 19, 2019 13:40:33 GMT
Maybe wrongly I invested in GBBA2 assuming that large allocations of some loans would be reduced as new loans were added and more investors arrived, hopefully before they had time to become a problem. Presumably this will not be happening now and we will be stuck with large amounts of loans for which there is no demand, so diversification is being destroyed by this closure.
This is not what I expected when I invested in this account and I feel I have been misled. Thinking out loud, do you think there is room for a change in regulations over this kind of thing? Can you see a way where investors in this product could be integrated into another AC product? There have been changes on other platforms where terms and conditions were changed with no option of lender escape. Perhaps platforms should only offer products which could be dismantled or rolled into a different vehicle if it 'goes wrong', rather than leave the sort of risk that you describe? The terms and conditions haven't been changed. All that has happened is the product has been shut to new investment. This does not mean that loans can not be sold, they can be sold exactly as before. The issue is some of the loans are in low demand so can only be sold by discounting - something that has never been possible with these accounts. As has been mentioned earlier in this thread, AC are looking at allowing investors who wish to switch their holdings into their MLIA where they can discount as much as they wish.
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Post by brightspark on Nov 19, 2019 15:01:41 GMT
Discounting is available only if it the loan is not suspended. Moving black box loans to another account type simply moves a suspended loan from one account type to another. Unless bad payers are pursued promptly and with relentless vigour confidence in AC will melt away. Following the Lendy and Funding Secure horrors the small investor community will not hang about. Any sign of crony capitalism/old boy network loans will not go down at all well.
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sl75
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Post by sl75 on Nov 19, 2019 15:08:58 GMT
As has been mentioned earlier in this thread, AC are looking at allowing investors who wish to switch their holdings into their MLIA where they can discount as much as they wish. In order for this to be fair, it should probably at least inform investors of what they're giving away - i.e. the net contribution to the provision fund of the loans being transferred. It should also certainly avoid transferring loans that will not be able to be sold in the MLA (many of which are likely to be net beneficiaries of the PF at the end of the recovery process), as this provides no benefit whatsoever to the investor.
I understand that AC have already taken some of this "excess cash" as profit for themselves (at least part of which is understood to have been passed on to a different set of investors under a separate confidential agreement), so directly refunding the investor's fair share of the PF would probably not be possible.
In addition to looking at the possibility of enabling transfers to MLA, I would repeat that it would seem a good idea to look at how these accounts and their associated provision funds might be able to be absorbed into the Access Accounts (either on an opt-in basis when explicitly activated by an individual investor, or as a bulk transfer for "all" investors [potentially with an opt-out for investors who reject that change], and either into one of the existing access accounts, or into 2 special new exclusive accounts that directly replace the GBBA2 and PSA respectively - a bit like how there were separate QAA and 30DAA accounts for investors who signed up via certain promotions...).
It's possible that the provision funds on the GBBA2 and PSA are not sufficient to allow the necessary amount to be ringfenced in order to allow the loan units to trade within the access accounts. That's information that only AC would have access to. In that case, it's possible that AC might charge a "transfer fee" to allow all of an investor's GBBA2/PSA loans to be transferred to the 90/30/QAA on an opt-in basis; the fee serving the dual purpose of helping to top up the PF shortfall and discouraging frivolous use.
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andy5
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Post by andy5 on Nov 19, 2019 22:32:39 GMT
andy5 As explained, if a loan falls outside the account's parameters then the system will sell any holdings in that loan. If loads do not then they will be held to term unless you request a withdrawal. So I would not expect that 'depletion' to continue unless other loans also fall outside the account's investment criteria, but that's not something I can readily predict. Can we please come back to this point. If that is the case, then why are three parts of the same loan being sold 18 or 100 hours apart, on three separate days? Will there be 4th and more sales of the same holding, given that some remains?
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Post by chris on Nov 19, 2019 22:35:40 GMT
andy5 As explained, if a loan falls outside the account's parameters then the system will sell any holdings in that loan. If loads do not then they will be held to term unless you request a withdrawal. So I would not expect that 'depletion' to continue unless other loans also fall outside the account's investment criteria, but that's not something I can readily predict. Can we please come back to this point. If that is the case, then why are three parts of the same loan being sold 18 or 100 hours apart, on three separate days? At a guess, without having any specifics to investigate, different runs of the marketplace with different buyers as they become available.
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sl75
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Post by sl75 on Nov 20, 2019 8:00:22 GMT
If that is the case, then why are three parts of the same loan being sold 18 or 100 hours apart, on three separate days? Will there be 4th and more sales of the same holding, given that some remains? To further add to chris's more informed reply, if a particular loan is outside the account's parameters, then it's not just you trying to sell it, but also every investor who holds that loan in that account.
As and when potential buyers come along, they'll have A LOT of loan units available, and AC's systems use a selling pool rather than a queue, so each time there are sellers and buyers to match, the system is intended to equalise the amounts sold by each seller (unless their total sale is less than the clearing amount) and to equalise the amounts received by each buyer (unless their total buying instruction is less than the clearing amount).
Where a substantial amount remains unsold, it's simply due to there not being enough willing buyers with available funds at the moment the loan was processed. "18 or 100 hours" later, more buyers will have emerged, or previous buyers will have more available funds with which they can purchase further loan units.
The matching algorithms have various issues where the implementation doesn't match the design intent, so even in cases where there are sufficient buyers, a small unsold amount often remains, most of which gets matched next time the loan is processed, etc., but that's a whole different subject. I'm fairly sure it's part of the reason that AC throttle the matching algorithm so as only to process sales on each loan about 1 or 2 times per day.
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jlend
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Post by jlend on Nov 21, 2019 9:09:08 GMT
The irony is that I thought I understand how the GBBA worked from this post from stuartassetzcapital in September 2015 which IMHO is quite different to the FAQs that were added years later following the first delayed interest payments. " if interest is due to be paid on a certain date and is missed then the Provision Fund (PF) is there to help pay that to help monthly interest on the account remain at 7%. If capital repayment is due and is late/ a default happens then interest continues to accrue on an interest-accrued loan and would continue to accrue (and would not be paid by the PF) until recovery had been completed and then the total accrued interest would be paid out including the default period. If the loan had monthly interest then this would be eligible for payment by the PF at that time of missed payment on a discretionary basis until full recovery had been completed. Due to interest accruing (or being paid in the case of monthly payment loans) and prior to any capital loss having been crystalised, no payout of any capital would occur from the PF until the recovery and any possible loss was crystalised, at which point if all capital and also accrued interest had been paid then no PF payment would be required. If there was a shortfall then the PF would be asked to pay. Given the Great British Business Account (GBBA) account is designed for income investment then this approach is fair as an extended period of default interest accruing for the investor is aligned with the core objective of the account, income. "
They have developers working on projects all the time, so it's highly likely that over four years the a/c's M.O. would be somewhat different, in fact I'd be annoyed if it wasn't different. , chris did the developers change the code from the original description of the GBBA1 account PF supplied by stuartassetzcapital? Thanks
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oxdoc
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Post by oxdoc on Dec 1, 2019 18:16:59 GMT
No advance warning and not even a notification. I just happened to look at my account to find recent funds removed from GBBA2. Not impressed so looking for alternatives for UK funds. I also didn't get any communication from AC about this - this seems like poor customer service.
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Post by stuartassetzcapital on Dec 4, 2019 6:54:19 GMT
No advance warning and not even a notification. I just happened to look at my account to find recent funds removed from GBBA2. Not impressed so looking for alternatives for UK funds. I also didn't get any communication from AC about this - this seems like poor customer service. Advance notice could lead to customer detriment so we do not provide it in cases where that is judged a risk.
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sl75
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Post by sl75 on Dec 4, 2019 8:55:08 GMT
I also didn't get any communication from AC about this - this seems like poor customer service. Advance notice could lead to customer detriment so we do not provide it in cases where that is judged a risk. I'm only seeing customer detriment from LACK of advance notice in this case - customers who, in good faith, added funds to the platform with the intent to invest in those accounts (or indeed who had already added the money to the account without it having actually purchased loans) having their time wasted and money not earning any interest.
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JamesFrance
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Post by JamesFrance on Dec 5, 2019 10:05:15 GMT
Advance notice could lead to customer detriment so we do not provide it in cases where that is judged a risk. I'm only seeing customer detriment from LACK of advance notice in this case - customers who, in good faith, added funds to the platform with the intent to invest in those accounts (or indeed who had already added the money to the account without it having actually purchased loans) having their time wasted and money not earning any interest. Well I finally had an email announcing this, it seems the original was sent as part of "marketing" which I had turned off because of the regular pestering. So far I have managed to get over half of our money out of GBBA2 and now earning an even less acceptable rate of interest for the risk involved. Why do some platforms think they don't need to keep their side of the deal offered to their customers?
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