alender
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Post by alender on Jun 24, 2020 7:16:20 GMT
This good news for AC but bad news for AA holders.
There should be no new lending of any retail money until normal withdraws froms AAs can be made so therefore no need for an AA SM. Any money lent out via MLA is money that could have been used to to buy into the AAs through the SM so therefore increase the discount, the time stuck in lockdown and the misery to AA holders. However it does give AC more fess, these fees should be used to remove the lenders fees and the restore the AA's interest rate, then at least existing lenders will get some benefit from this.
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dave2
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Post by dave2 on Jun 24, 2020 7:46:00 GMT
This good news for AC but bad news for AA holders.
There should be no new lending of any retail money until normal withdraws froms AAs can be made so therefore no need for an AA SM. Any money lent out via MLA is money that could have been used to to buy into the AAs through the SM so therefore increase the discount, the time stuck in lockdown and the misery to AA holders. However it does give AC more fess, these fees should be used to remove the lenders fees and the restore the AA's interest rate, then at least existing lenders will get some benefit from this.
Why should new lending activity be frozen and Assetz Capital liquidated and wound down just to satisfy a few miserable AA holders? New lending is good news for everybody, my money is lined up and waiting to invest.
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blender
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Post by blender on Jun 24, 2020 7:48:53 GMT
What this shows is the very urgent need for the Access SM. No-one knows the real size of the AA holders' requirement or wish to take cash out, how much discount they are prepared to give for liquidity, and how long it would take for the 'safety valve' of the SM to run its course - as the MLA has. At present we have to list a great deal for withdrawal to get out a little. Personally I have done this, but I have no immediate requirement to use the cash. I just cannot afford to have it locked up as it is at present (which was my mistake). The main benefit of the SM will be its existence, not its use, imo. Whether the MLA supports new lending is secondary, for me.
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alender
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Post by alender on Jun 24, 2020 7:59:06 GMT
This good news for AC but bad news for AA holders.
There should be no new lending of any retail money until normal withdraws froms AAs can be made so therefore no need for an AA SM. Any money lent out via MLA is money that could have been used to to buy into the AAs through the SM so therefore increase the discount, the time stuck in lockdown and the misery to AA holders. However it does give AC more fess, these fees should be used to remove the lenders fees and the restore the AA's interest rate, then at least existing lenders will get some benefit from this.
Why should new lending activity be frozen and Assetz Capital liquidated and wound down just to satisfy a few miserable AA holders? New lending is good news for everybody, my money is lined up and waiting to invest. Good news for people waiting for large AA discounts so they can prey on the misery of others.
I think you will find it is more than just a few who are stuck in AAs against their wishes and suffering from the reduction in interest rates.
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p2ploser
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Post by p2ploser on Jun 24, 2020 8:01:36 GMT
This good news for AC but bad news for AA holders.
There should be no new lending of any retail money until normal withdraws froms AAs can be made so therefore no need for an AA SM. Any money lent out via MLA is money that could have been used to to buy into the AAs through the SM so therefore increase the discount, the time stuck in lockdown and the misery to AA holders. However it does give AC more fess, these fees should be used to remove the lenders fees and the restore the AA's interest rate, then at least existing lenders will get some benefit from this.
Im not sure if I follow this as I won’t be investing in the aa or aa’s at a discount but will be adding to the mla when new loans start again so don’t think it’s true that new loans in the mla will take cash from aa’s.....unless im missing something?
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dead-money
Rocket to the Moon
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Post by dead-money on Jun 24, 2020 8:22:08 GMT
The linked article also states the following: “We just want to get our investors back to sensible liquidity again. When that’s happening, I’d expect to go back to lending in our access accounts.” So the question is: what does normal liquidity mean in that context? I think most of those wishing to exit access accounts would define it as being able to leave at par as applied until early march, or at the very least have all capital redemptions in their access loan book returned to them as it is repaid rather than being retained as at present for future tranches. However Assetz may claim the new secondary market provides exit liquidity to investors and therefore that access funds can be used to restart further loans shortly after this market commences. There would be no way then of ever having capital returned from access accounts unless accepting whatever (possibly large) discount that needs to be offered, assuming that the demand from other investors even exists. It was stated in a previous update from Assetz that they are looking at an IPO and it is no doubt helpful to that cause to have a pool of circa £200 million of retail money that can be held indefinitely under the accounts' terms of reference. Maybe this is being cynical but with what has gone on so far I would welcome a clear commitment that new loans will not be made with access money until the pre March 12th conditions are restored and if that liquidity has to be suspended again at any point thereafter then new loan lending would also immediately stop (from access). This would make the AAs pay down over 0-5 years at best. Did there used to be an option to have principal returned from AAs to Cash? I'm not certain that was the case actually. No, it's a mythical beast that some are forlornly clinging to as their saviour /s
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jlend
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Post by jlend on Jun 24, 2020 8:36:50 GMT
Chief executive Stuart Law (pictured) told Peer2Peer Finance News that the platform is likely to restart lending in the manual lending product in July and will subsequently restart lending in its access accounts when liquidity returns. Law said the loans will have lower loan-to-values and higher interest rates. “We always knew when the next cycle came our retail lending would restart in the manual lending account,” he said. “We’re going to put the first few loans to investors in the next couple of weeks. We’ve taken time to assess where we’re at, update our guidelines and work on our coronavirus business interruption loan scheme (CBILS) lending. “And we’re now ready to offer new loans to retail investors under the new guidelines in our manual loans, but not under CBILS because that requires institutional funding.” Any interplay between new AA investment and new MLA investment is unknown but it is known that the investors in the two accounts can be quite different so interplay probably limited. Thanks. Have you considered trying to fund some of the existing tranche drawdowns via manual lenders rather than the access accounts? This might benefit manual and access account holders?
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blender
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Post by blender on Jun 24, 2020 10:04:33 GMT
Why should new lending activity be frozen and Assetz Capital liquidated and wound down just to satisfy a few miserable AA holders? New lending is good news for everybody, my money is lined up and waiting to invest. Good news for people waiting for large AA discounts so they can prey on the misery of others.
I think you will find it is more than just a few who are stuck in AAs against their wishes and suffering from the reduction in interest rates. It is true that interest rates have reduced and fees have been introduced, but it is not necessarily the case that the holders are suffering from lower comparable returns than they could get elsewhere. The prime issue is liquidity, and those who think they can do better elsewhere, in current circumstances, should be able to go elsewhere. However, the current return on the Access Accounts will appear better in the context of improved liquidity, after the initial shakeout. If some people are prepared to offer a large discount to get out they should be permitted to do so - let the market rate be found. The steam will soon go out of it, imo.
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iRobot
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Post by iRobot on Jun 24, 2020 10:32:49 GMT
That was all there was. It was part of a verbal call. Ah. OK. I interpreted your " Coverage of our past statement" comment differently. Thanks for clarifying.
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Post by Harland Kearney on Jun 24, 2020 10:41:17 GMT
Good news for people waiting for large AA discounts so they can prey on the misery of others.
I think you will find it is more than just a few who are stuck in AAs against their wishes and suffering from the reduction in interest rates. It is true that interest rates have reduced and fees have been introduced, but it is not necessarily the case that the holders are suffering from lower comparable returns than they could get elsewhere. The prime issue is liquidity, and those who think they can do better elsewhere, in current circumstances, should be able to go elsewhere. However, the current return on the Access Accounts will appear better in the context of improved liquidity, after the initial shakeout. If some people are prepared to offer a large discount to get out they should be permitted to do so - let the market rate be found. The steam will soon go out of it, imo.
Could not agree more, assuming the AC market rate is true to its word with no additional exit fees I couldn't support it anymore. It will be a long time currently for AC to find liquidity without a real market rate being found by real buyers/sellers, not the Godly hand of rata repayments as we are seeing currently. My instinct is that the inital opening will be some steep discounts from panic sellers or those needing to get out now for any extremely pressing reason. After that, think the rate will normalise after weeks/month to a acceptable rate. I don' think it be going to par though anytime soon. However, I'm more happy to be with AC right now than some other platforms sorry state of affairs on this board.
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Post by honda2ner on Jun 24, 2020 11:42:28 GMT
Why should new lending activity be frozen and Assetz Capital liquidated and wound down just to satisfy a few miserable AA holders? New lending is good news for everybody, my money is lined up and waiting to invest. Good news for people waiting for large AA discounts so they can prey on the misery of others.
I think you will find it is more than just a few who are stuck in AAs against their wishes and suffering from the reduction in interest rates. It's called capitalism, if you don't like it then you could always try starving in North Korea. AA holders are free to decide any discount so if you don't want to lose money then it's a risk you are fully entitled to take. I once bought a cheap car at an auction, it turned out to be a complete turd but I didn't complain or bleat that others must immediately help me out at great cost. No, I took a punt and lost, better luck next time. AC needs to be seen to be doing the right thing, that is a clearly articulated plan to have the AA SM up and running before MLA lending restarts. That's all.
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Post by honda2ner on Jun 24, 2020 11:58:26 GMT
Chief executive Stuart Law (pictured) told Peer2Peer Finance News that the platform is likely to restart lending in the manual lending product in July and will subsequently restart lending in its access accounts when liquidity returns. Law said the loans will have lower loan-to-values and higher interest rates. “We always knew when the next cycle came our retail lending would restart in the manual lending account,” he said. “We’re going to put the first few loans to investors in the next couple of weeks. We’ve taken time to assess where we’re at, update our guidelines and work on our coronavirus business interruption loan scheme (CBILS) lending. “And we’re now ready to offer new loans to retail investors under the new guidelines in our manual loans, but not under CBILS because that requires institutional funding.” Any interplay between new AA investment and new MLA investment is unknown but it is known that the investors in the two accounts can be quite different so interplay probably limited. Thanks. Have you considered trying to fund some of the existing tranche drawdowns via manual lenders rather than the access accounts? This might benefit manual and access account holders? It would be nice but probably just wishful thinking, the AAs are very heavy in low interest rate loans which just wouldn't move in the MLA unless sweetened. Unfortunately the existing tranche drawdowns are contractually fixed so the borrower isn't likely to pay more interest (even if they could) and AC can't (nothing to do with them anyway, they are just the middlemen and don't have that sort of money if they are to survive). The contract is between lender and borrower so the sweetener would need to come from one or both of them.
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Post by elf on Jun 24, 2020 15:00:56 GMT
This good news for AC but bad news for AA holders.
There should be no new lending of any retail money until normal withdraws froms AAs can be made so therefore no need for an AA SM. Any money lent out via MLA is money that could have been used to to buy into the AAs through the SM so therefore increase the discount, the time stuck in lockdown and the misery to AA holders. However it does give AC more fess, these fees should be used to remove the lenders fees and the restore the AA's interest rate, then at least existing lenders will get some benefit from this.
Why should new lending activity be frozen and Assetz Capital liquidated and wound down just to satisfy a few miserable AA holders? New lending is good news for everybody, my money is lined up and waiting to invest. No one is objecting to new retail lending via MLA as that obviously must be via investor consent. However redeemed capital from loans in AA accounts should not be invested in new loans whilst there is insufficient capital in the liquidity pool so people cannot exit at par. In other words no new loans from AA money until pre 12th March exit conditions apply. It will be interesting to see if Stuart will confirm that. If he won't it suggests the purpose of the SM is to claim AA liquidity has returned so they can start using the AA capital repayments for new loans. In that case exit at par may never appear again.
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Post by elf on Jun 24, 2020 15:37:35 GMT
Thanks. Have you considered trying to fund some of the existing tranche drawdowns via manual lenders rather than the access accounts? This might benefit manual and access account holders? It would be nice but probably just wishful thinking, the AAs are very heavy in low interest rate loans which just wouldn't move in the MLA unless sweetened. Unfortunately the existing tranche drawdowns are contractually fixed so the borrower isn't likely to pay more interest (even if they could) and AC can't (nothing to do with them anyway, they are just the middlemen and don't have that sort of money if they are to survive). The contract is between lender and borrower so the sweetener would need to come from one or both of them. The loans with tranches are mainly development loans which all appear to have a higher rate of interest and so are invested in by both MLA and AA; presumably there is institutional money in some of them too. Unfortunately the terms of reference of the AAs allow Assetz to withhold capital repayments in case other sources of funding cannot be found for the future tranches. So basically access account holders have to carry the can to service the other categories of investor. Its actually quite a common thing I've noticed in investments that a strategy/scheme that is lower-than-average risk under normal market conditions actually switches to becoming a worst-than-average outcome when things go bad. So access was the apparently lower risk option but MLA is now better since each loan can either be sold at discount or you can wait to redemption whereas "Access" currently has neither option and selling-at-discount is presumably the only future possibility.
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Post by honda2ner on Jun 24, 2020 16:17:14 GMT
It would be nice but probably just wishful thinking, the AAs are very heavy in low interest rate loans which just wouldn't move in the MLA unless sweetened. Unfortunately the existing tranche drawdowns are contractually fixed so the borrower isn't likely to pay more interest (even if they could) and AC can't (nothing to do with them anyway, they are just the middlemen and don't have that sort of money if they are to survive). The contract is between lender and borrower so the sweetener would need to come from one or both of them. The loans with tranches are mainly development loans which all appear to have a higher rate of interest and so are invested in by both MLA and AA; presumably there is institutional money in some of them too. Unfortunately the terms of reference of the AAs allow Assetz to withhold capital repayments in case other sources of funding cannot be found for the future tranches. So basically access account holders have to carry the can to service the other categories of investor. Its actually quite a common thing I've noticed in investments that a strategy/scheme that is lower-than-average risk under normal market conditions actually switches to becoming a worst-than-average outcome when things go bad. So access was the apparently lower risk option but MLA is now better since each loan can either be sold at discount or you can wait to redemption whereas "Access" currently has neither option and selling-at-discount is presumably the only future possibility. The development loans in the MLA already have huge amounts for sale, some at a discount so transferring any AA holding of those loans at par will not sell a penny. I fail to see why AA holders don't have the option of waiting for redemption, are you suggesting that all the loans are bad and all the collateral is worthless? The MLA (which gives a truer picture of actual asset value) certainly doesn't reflect that, most discounts are in the 0-2% range so its nearly bottomed out at par. After the initial frenzy on the AA SM I expect the AAs to be similar or closer to par as they are lower risk than the same loan in the MLA. I agree that AA investors are having a rough ride but it was obvious there was no emergency exit and it was a horrible black box inside of which only AC knows the risks. I suspect that all P2P platforms are choosing to hurt the investors that are easiest to replace, from a purely pragmatic point of view it's the only sensible thing to do as the least worst option for them. I'm still completely confident that in a few months the Access Accounts will be flooded with money from investors fascinated by this new and exciting P2P thingy and the whole merry go round starts again. I hope I'm wrong as the AAs have been forcing MLA rates down for years and I would like nothing better than to see the AAs gone forever but I'm not that naive.
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