Article in The Times August 8th

Thanks jonboy,I spotted it after I posted this :-)

In an article in The Times, dated 8th August 2016, some comments were made about Saving Stream, and certain loans written through the platform.

We feel that this article omitted a number of salient points which would enable investors to make a proper judgment about the issues involved.

It is important to us to be clear with our investors over the loans and the properties they are investing in. It is not our policy to comment on individual borrowers, but all borrowers are, of course, subject to due diligence.

In bridging finance, the value of the asset upon which the loan is secured is necessarily the single most important of the criteria upon which we make the commercial decision over whether or not to lend. The other main criteria include the due diligence on the borrower, and the interest rate and other terms of the loan.

In case of default on a bridging loan, the lender’s recourse is to repossess the asset and use the proceeds of a sale to ensure that it recovers as much of the loan as possible. In the first of the two cases of default from the 125 loans written by Saving Stream, we achieved 100% recovery. We also expect close to 100% recovery in the second case.

We also maintain a discretionary provision fund equal to 2% of the value of current loans. It stands at £2.5 million at present. This fund may, at the discretion of the directors, be used to make up any shortfall in case recovery does not reach 100% of the loan value.

The Times article states, in reference to PBL064, “One of the loans, worth £2 million, is secured against a tenanted office block that Saving Stream said was worth £2.9 million. The building had been purchased for £900,000 in 2014.”

The valuation of this property was undertaken by a large commercial property valuation agency with specialist expertise in this area. All property valuations in relation to Saving Stream loans are undertaken by independent valuers. Should the valuation of any property be negligent, Saving Stream would have recourse to the valuer’s professional indemnity insurance. 

We agree with Andrew Tyrie’s warning in the article that “poorly informed investors may be left with a false sense of security about the balance of risks versus return” by some P2P platforms. That is why our website has a detailed risk statement, explaining the risks to investors of making investments through Saving Stream. That risk assessment is linked at the top of our homepage to ensure all investors read and understand it before making an investment. We welcome the FCA’s review of the P2P industry, and comply fully with all requirements placed upon us by the regulator.

Extract from 'Risk Assessment';

Before we allow each Borrower to receive their loan, we make identity, fraud and credit checks. We also use the Borrower’s credit reference, and certain additional Information that we verify, to assess the affordability of the loan. If we find that the information was inaccurate or deficient the loan will not proceed.


I take it these checks were carried out on the borrower in the case of PBL's 064 and 056?