star dust
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Post by star dust on Jul 8, 2015 14:14:47 GMT
I have just received an email from AH saying these developments are being worked on, and promising a solution by 31 July and further update by 17 July. This would be a welcome change, I just hope this promise is delivered on time - or should I say this time!
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jonah
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Post by jonah on Jul 8, 2015 17:18:43 GMT
Personally, with my naivety etc, I don't quite see the massive desire for discounted / premium parts, but I would agree that there does seem to be quite a high percentage of 'locked loans' so I viewed the email as a positive one.
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bigfoot12
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Post by bigfoot12 on Jul 8, 2015 20:08:32 GMT
Personally, with my naivety etc, I don't quite see the massive desire for discounted / premium parts, but I would agree that there does seem to be quite a high percentage of 'locked loans' so I viewed the email as a positive one. I don't expect that you will be able to sell much of your locked in loans if you don't offer a discount.
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jonah
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Post by jonah on Jul 8, 2015 21:11:50 GMT
Personally, with my naivety etc, I don't quite see the massive desire for discounted / premium parts, but I would agree that there does seem to be quite a high percentage of 'locked loans' so I viewed the email as a positive one. I don't expect that you will be able to sell much of your locked in loans if you don't offer a discount. Fair point. I had mentally seperated the two parts, ie premium / discount and potentially impaired loans. Based on my wording though you comment is fair.
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Post by Ton ⓉⓞⓃ on Jul 9, 2015 18:50:25 GMT
I don't expect that you will be able to sell much of your locked in loans if you don't offer a discount. Fair point. I had mentally seperated the two parts, ie premium / discount and potentially impaired loans. Based on my wording though you comment is fair. I notice you say "premium / discount" I'm not convinced we will be able to put a premia on loan parts. I think when AC first started I think you could then, but that stopped a long time ago. The email only talked about a discount. Some think you should be able to put a premium on loans, my feeling is it can encourage short-termism. Perhaps when AC gets larger it might be appropriate within limits. I can see that it might help u/writers shift loans onto others who then try to sell using the premium to make a profit.
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niceguy37
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Post by niceguy37 on Jul 9, 2015 19:46:52 GMT
Fair point. I had mentally seperated the two parts, ie premium / discount and potentially impaired loans. Based on my wording though you comment is fair. I notice you say "premium / discount" I'm not convinced we will be able to put a premia on loan parts. I think when AC first started I think you could then, but that stopped a long time ago. The email only talked about a discount. Some think you should be able to put a premium on loans, my feeling is it can encourage short-termism. Perhaps when AC gets larger it might be appropriate within limits. I can see that it might help u/writers shift loans onto others who then try to sell using the premium to make a profit. Selling at a discount can really help liquidity, but I'm against being able to charge a premium. I think would would suck a lot of the value out of the market, and give the underwriters an unfair advantage. I don't think AC will introduce selling at a premium.
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bigfoot12
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Post by bigfoot12 on Jul 9, 2015 20:20:32 GMT
I notice you say "premium / discount" I'm not convinced we will be able to put a premia on loan parts. I think when AC first started I think you could then, but that stopped a long time ago. The email only talked about a discount. Some think you should be able to put a premium on loans, my feeling is it can encourage short-termism. Perhaps when AC gets larger it might be appropriate within limits. I can see that it might help u/writers shift loans onto others who then try to sell using the premium to make a profit. Selling at a discount can really help liquidity, but I'm against being able to charge a premium. I think would would suck a lot of the value out of the market, and give the underwriters an unfair advantage. I don't think AC will introduce selling at a premium. I am also against selling at a premium with two caveats. If I buy a loan at a discount I would like to be able to resell it at less of a discount, this would be important for me before I would buy loans with adverse credit. Secondly in the far far future when interest rates have risen and then fallen I would like to be able to sell loans at a premium and without this I think liquidity will dry up, but I think this is years away.
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jjc
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Post by jjc on Jul 11, 2015 12:05:28 GMT
If I buy a loan at a discount I would like to be able to resell it at less of a discount, this would be important for me before I would buy loans with adverse credit.Interesting point bigfoot12 (which I agree with). If AC loosen the trading restrictions on distressed loans (I think they should & perhaps must – the current gridlock is excessive.. 36% of AC’s loanbook at my last count… & serves no-one’s interests) it seems one way they could do this more safely would be in a separate market (accessible only to manual lenders) – kind of a Discount Sales Corner. One question in this case would be if I buy something on the DSC & then wish to sell it at par (or less of a discount) as would appear reasonable, are the units sellable only on the DSC or also on the main market (in which case I’ve effectively washed the units of their DSC-only sales limitation & made a little profit from doing so)? Perhaps restricting onward sales of suspended loans to the DSC, but allowing them on the main market for non-suspended loans would be a way around this? That way lenders can exit loans not in trouble more quickly if they wish to by paying a fee for this facility, but can’t offload units of distressed loans on to others.
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bigfoot12
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Post by bigfoot12 on Jul 12, 2015 12:06:49 GMT
One question in this case would be if I buy something on the DSC & then wish to sell it at par (or less of a discount) as would appear reasonable, are the units sellable only on the DSC or also on the main market (in which case I’ve effectively washed the units of their DSC-only sales limitation & made a little profit from doing so)? Perhaps restricting onward sales of suspended loans to the DSC, but allowing them on the main market for non-suspended loans would be a way around this? That way lenders can exit loans not in trouble more quickly if they wish to by paying a fee for this facility, but can’t offload units of distressed loans on to others. I think that the condition for inclusion in the main market would be no current credit problems. So if a loan has repayment problems because a tenant has defaulted it goes on the DSC, perhaps with default interest. If a new tenant is found and the arrears are made good it can be returned to the main market.
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Post by reeknralf on Jul 12, 2015 12:33:13 GMT
Some think you should be able to put a premium on loans, my feeling is it can encourage short-termism. Why is short termism a bad thing in a p2p secondary market?
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Post by Deleted on Jul 12, 2015 13:38:03 GMT
Trouble is the energy that AC should be putting into avoiding these problems and working on the problems they already have has now been focused instead on letting us tinker with the broken elements of their business model. I like AC and I think they have a great place in the market, but over the last 9 months I have seen them on many occasions take on too much, make promises and then fail to deliver. I suspect there is someone on the board who cannot stop inventing yet more things to distract the management team. Let's call him "Bright & Energetic". You need people like B&E but he should not be in charge and there should be people who can/do/will rein him back. Right now they are not and AC manages to over-invent, overstretch and underachieve and I suspect the Board don't see anything wrong with this. Looks like the board/management team also lacks a "completer-finisher" for those who know their Belbin. Hopefully our usual contacts are having a Sunday off in the sun (BTW 18 hour days are not the way to solve business problems they are the way to make business problems). They need to be less busy and more.... what is that word..... begins with a C.......  |
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