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Post by fundingsecure on Feb 17, 2015 17:09:58 GMT
Loan StatisticsWe have added additional data on our investors page which can be found here: www.fundingsecure.com/investors/statisticsNOTE: - Above link has been changed - as the statistics now have their own pageDespite our first capital loss (Totalling £512) we believe the overall performance remains positive. We remain a relatively new platform - having only been operating for 19 months. For this reason the predicted rates, at the bottom of the page, are lower than our current levels. This data will be updated monthly. Regards FundingSecure
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Post by mrclondon on Feb 18, 2015 18:05:09 GMT
fundingsecure , its been mentioned on this forum before, but I don't believe you commented on the fact that the banner ad which appears from time to time on this forum states 13% return p.a There is no "upto". Sooner or later this will be the subject of a complaint to FCA who are already investigating misleading promotions by p2p companies. Are you hoping you'll just get a telling off and not a punitive fine ?
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mikes1531
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Post by mikes1531 on Feb 18, 2015 22:11:16 GMT
fundingsecure@fundingsecure: Thank you for providing this useful and informative data. However... I believe that the 0.01% shown on the line labelled "Capital lost though defaults*" -- where the note says "*Calculated based on completed loans" is incorrect because the £512 of capital lost appears to have been divided by the £4,244,253 shown as 'Total amount Lent to Date' rather than the £1,352,615 of completed loans. I believe the correct number ought to be 0.04%. fundingsecure, its been mentioned on this forum before, but I don't believe you commented on the fact that the banner ad which appears from time to time on this forum states 13% return p.a There is no "upto". Sooner or later this will be the subject of a complaint to FCA who are already investigating misleading promotions by p2p companies. Are you hoping you'll just get a telling off and not a punitive fine ? In addition to what mrclondon observed, I would add that the adverts are inconsistent with the bottom line of the Statistics page, which says the "Estimated net return" is "11.2% per annum". Perhaps if the 13% mentioned in the adverts had a footnote to the effect that it "Does not include the effect of defaults" -- or something similar -- it might defuse potential complaints.
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coop
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Post by coop on Feb 20, 2015 14:49:04 GMT
"Predicted Rates
Estimated future rates of return are as follows:
Gross interest payable: 12.7% per annum
% of Loans Defaulting 7.0%
Estimated net return 11.2% per annu"
7% seems pretty high; but presumably you're recovering much of the capital lent through sale of the asset. Difference between gross payable and est net return is 1.5%; is that then the estimated % of capital lost through defaults?
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bugs4me
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Post by bugs4me on Feb 20, 2015 15:02:33 GMT
"Predicted Rates Estimated future rates of return are as follows: Gross interest payable: 12.7% per annum % of Loans Defaulting 7.0% Estimated net return 11.2% per annu" 7% seems pretty high; but presumably you're recovering much of the capital lent through sale of the asset. Difference between gross payable and est net return is 1.5%; is that then the estimated % of capital lost through defaults? Maybe got this wrong so stand to be corrected. Appears as though there is a 7% default in terms of loans listed and an expected 13% capital loss.
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Post by mrclondon on Feb 20, 2015 18:44:03 GMT
fundingsecure , its been mentioned on this forum before, but I don't believe you commented on the fact that the banner ad which appears from time to time on this forum states 13% return p.a There is no "upto". Sooner or later this will be the subject of a complaint to FCA who are already investigating misleading promotions by p2p companies. Are you hoping you'll just get a telling off and not a punitive fine ? Just spotted the new banner ad with the clearly stated "up to 13% return p.a.". A sensible, quick move by fundingsecure. Theres also a disclaimer "please note: your capital is at risk" although the contrast of this text on my monitor isn't great.
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Post by fundingsecure on Feb 20, 2015 19:17:15 GMT
Just to clarify as there appears to be some confusion here:
Average gross Interest - weighted average interest per annum. This is the interest rate offered on each loan when listed.
Currently the average gross interest that was offered on loans that have paid out is approximately 12.7% pa. We expect this average to continue.
Defaulted Loans - this is based on the value of the loans that default, not the amount lost. (In most cases, we have recovered both capital and interest)
Currently our actual default rate is 3.3%. Adding in overdue loans (which may default) gives a total of 5.3% of loans potentially defaulting.
We are being cautious in estimating that future defaults will be higher - around 7%.
Estimated net return - this is the anticipated net interest, based on a fully diverse portfolio, taking into account all loans, including any monies lost through defaults.
For all loans completed to date (including defaults) our actual net return was 12.5% pa. We are again being cautious and estimating that the future net return will drop to 11.7% pa
Example - based on a fully diverse investment (across all loans)
The average rate offered on the loans that have completed was 12.7% pa
On loans completed you would have received 12.5% pa interest in addition to all of your capital.
Future loans we estimate will return 11.7% pa interest in addition to all of your capital.
Of course for any individual loan the figures can be markedly different - including potential lost capital as well as reduced or no interest. We continue to set valuations and LTV's which we believe will ensure full return in the event of a default. However there have been, and there will be, cases where the funds recovered are insufficient. For this reason we strongly recommend spreading investments across as wide a range of loans as possible, to minimise the effect of any single loan underperfoming.
PS - Apologies for the delay in posting the amended ad - finally got the correct one listed.
PPS - Apologies for the small error in posting - capital lost represents 0.04% of completed loans, not 0.01%. Figures have been amended accordingly
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mikes1531
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Post by mikes1531 on Feb 20, 2015 22:21:20 GMT
Difference between gross payable and est net return is 1.5%; is that then the estimated % of capital lost through defaults? Just because there is no loss of capital doesn't mean there will be no impact on a lender's 'net' return. This difference between the gross and net returns also should include any defaults where the recovery might be enough to return all capital but not enough to pay all the accrued interest. For example, the Yamaha Thundercat motorbike sale returned all lenders' capital but no interest. For that loan the return would have been 0%, and when that return is included in the calculation of a lender's overall return would result in a reduced return (via dilution) even though no capital was lost. Maybe got this wrong so stand to be corrected. Appears as though there is a 7% default in terms of loans listed and an expected 13% capital loss. : Where did the 13% number come from?
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bugs4me
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Post by bugs4me on Feb 20, 2015 22:31:54 GMT
Difference between gross payable and est net return is 1.5%; is that then the estimated % of capital lost through defaults? Just because there is no loss of capital doesn't mean there will be no impact on a lender's 'net' return. This difference between the gross and net returns also should include any defaults where the recovery might be enough to return all capital but not enough to pay all the accrued interest. For example, the Yamaha Thundercat motorbike sale returned all lenders' capital but no interest. For that loan the return would have been 0%, and when that return is included in the calculation of a lender's overall return would result in a reduced return (via dilution) even though no capital was lost. Maybe got this wrong so stand to be corrected. Appears as though there is a 7% default in terms of loans listed and an expected 13% capital loss. : Where did the 13% number come from? I took the percentage of loans defaulting at 7% which is the number not a value. Gross interest payable: 12.7% per annum - Estimated net return 11.2% per annum. So that by my calculations equates to a c13% loss of interest and capital. Maybe my figures are wrong as it was on the back of a fag packet. But these figures have subsequently been clarified by a later FS post.
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mikes1531
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Post by mikes1531 on Feb 21, 2015 4:29:33 GMT
bugs4me: Where did the 13% number come from? I took the percentage of loans defaulting at 7% which is the number not a value. Gross interest payable: 12.7% per annum - Estimated net return 11.2% per annum. So that by my calculations equates to a c13% loss of interest and capital. Maybe my figures are wrong as it was on the back of a fag packet. : Perhaps I'm just being thick, but I still don't see how you get 13% out of the other numbers. Can you give any further info regarding your calculation process? How did you combine the given numbers?
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bugs4me
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Post by bugs4me on Feb 21, 2015 9:02:23 GMT
I took the percentage of loans defaulting at 7% which is the number not a value. Gross interest payable: 12.7% per annum - Estimated net return 11.2% per annum. So that by my calculations equates to a c13% loss of interest and capital. Maybe my figures are wrong as it was on the back of a fag packet. : Perhaps I'm just being thick, but I still don't see how you get 13% out of the other numbers. Can you give any further info regarding your calculation process? How did you combine the given numbers? - nope, not you being thick but I think I am especially as I cannot find my original scribblings. I was referring to the interest rate return and not capital as I originally posted so apologies for that.
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