andy2001
Member of DD Central
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Post by andy2001 on Apr 22, 2014 17:12:46 GMT
If AC read this forum, should we read something into the deafening silence that has come from them today. Everyone has been back in the office a full working day now and absolutely no response to the tirade of issues raised here and on the q&a page on AC site....I appreciate they must be feeling pretty sheepish about trying to fly this dead duck over Easter, but as someone who knows a little about Easter Resurrection....this one stands no chance in 3 days.... Well some of the Q&As have been answered, all be it not in a way that would make me want to be on this loan.
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Post by yorkshireman on Apr 22, 2014 18:22:50 GMT
So, what has suddenly changed to convince AC to offer such a loan?! Wheels within wheels or the old boys network perhaps? 
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Post by mrclondon on Apr 22, 2014 19:06:41 GMT
Well some of the Q&As have been answered, all be it not in a way that would make me want to be on this loan. Agreed. All my questions have been answered, but I'm far from impressed with the answers. I think AC would have a hard time defending two of those answers against a formal complaint to the FCA. Or is it just Andrew checking up on his staff to see how they perform without him. No man in Andrews position would dare to be out of touch with what is going on. Even on holiday IPhones and the like still work! I'd been thinking exactly the same thing, but then decided that if this is indeed a management training exercise, the introducer would have been anonymised as this reflect badly on Ludgate as much as AC. Irrespective, I think the events of the last few days will provide AC with a wake up call of how adequate holiday cover can be ensured for the key directors. I had expected the listing to be pulled today. The fact that it hasn't only reinforces my view that AC is running rudderless during this holiday period.
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mikes1531
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Post by mikes1531 on Apr 22, 2014 19:13:57 GMT
I had expected the listing to be pulled today. The fact that it hasn't only reinforces my view that AC is running rudderless during this holiday period. This whole episode is an embarrassment to AC, the introducer, and the borrower. Less than £500 has been bid on the auction so far today. The sooner it disappears the better off they'll all be.
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Post by jevans4949 on Apr 22, 2014 19:35:26 GMT
9% interest I could cope with, but a PG from somebody who, for all I know, has his other businesses in the same rocky condition, is not worth much. Presumably this guy has some bricks & mortar somewhere we could get a charge against - or is that already charged to somebody else?
Business-wise, the plan just seems to be to expand on what he's been doing for the past 10 years without success. If the product doesn't sell well enough to make a profit online and in London, what's so magic about New York?
As far as Assetz is concerned, maybe they just didn't want to go into the long weekend with nothing on offer?
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mikes1531
Member of DD Central
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Post by mikes1531 on Apr 22, 2014 19:41:00 GMT
As far as Assetz is concerned, maybe they just didn't want to go into the long weekend with nothing on offer? Perhaps, but they haven't exactly started this week with a flood of new loans to preview, either.
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Post by cyrilmadrid on Apr 22, 2014 20:01:27 GMT
I see people bidding 26 and 27 GBP on this loan. Do Assetz loans no longer trade in multiples of 20 GBP ?
Will they get fractions of loan parts ? Or loan parts will be of 1 GBP ? A nightmare for people who bid in thousands.
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spockie
Member of DD Central
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Post by spockie on Apr 22, 2014 20:05:58 GMT
I see people bidding 26 and 27 GBP on this loan. Do Assetz loans no longer trade in multiples of 20 GBP ? Will they get fractions of loan parts ? Or loan parts will be of 1 GBP ? A nightmare for people who bid in thousands. It was changed a couple of months ago. Bids just need to be above £20 now and not a multiple of £20. The loan part will be whatever they have bid.
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andy2001
Member of DD Central
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Post by andy2001 on Apr 22, 2014 20:07:07 GMT
I see people bidding 26 and 27 GBP on this loan. Do Assetz loans no longer trade in multiples of 20 GBP ? Will they get fractions of loan parts ? Or loan parts will be of 1 GBP ? A nightmare for people who bid in thousands. £20 is still the min, but it's no loner limited to multiples of £20.
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Post by andrewholgate on Apr 22, 2014 20:07:07 GMT
Emotions running high, so I will forgive some of the more acerbic comments. I will say I am a promoter of a free, independent forum but that does not mean abuse or derogatory comments can be made about my staff or anyone connected with this deal.
Firstly, David Ricketts ran the credit in my absence BUT I WAS INVOLVED THROUGHOUT despite being on holiday. It was on my say so that this deal went on the system. If you want someone to shoot at, shoot at me.
In banking terms this is a pure cash flow loan. The business is cash generative (see EBITDA as a proxy for cash) by about £1m a year. As a rule of thumb, you would want full amortisation over 3-5 years, debt no higher than 2.5x EBITDA, and reliance on cash flow.
Losses are caused by non cash items of depreciation and amortisation. This is an accounting correction of the goodwill on the balance sheet. Stripped out, this business is profitable.
In this case we have debt at 0.5x EBITDA and full amortisation over 3 years with strong cash flow in the business. This is a true cash flow loan.
There is asset security in the debenture with high levels of stock. Stock is listed at cost price, not retail. Even at 50% cost price there is enough stock to clear our loan and the other loan.
With my banking hat on, this is a good deal and is priced in lined with traditional banking hat on.
As a business, we are widening the types of deals we offer. In some ways we have spoilt you with lots of property, but a lack of it doesn't make it a bad deal.
I stand by my decision to list this auction. I can not ask you to lend nor can I make a recommendation, however these types of deals fill on other sites and AC is widening its appeal by offering further diversification.
I'll not make any further comment.
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merlin
Minor shareholder in Assetz and many other companies.
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Post by merlin on Apr 22, 2014 20:34:16 GMT
It crossed my mind over the holiday that may be this loan is typical of the type of loan that may be on offer on AC in the future. Initially when AC set up just over a year ago there was not the competition in the P2P market that there is now, and this IMHO can only increase with time. The drift away from bricks and mortar type guarantees by AC may also be an indication of the market hotting up and this of course was the main USP of AC that attracted many of us away from "director guarantees" type products. Additionally there is certainly some indication that this loan has already been shopped around other P2P lenders before arriving at AC.
As I have said before I wish AC well but in the meantime I shall be watching from the sidelines. Andrew you have virtually confirmed my above earlier assumptions. However this is not what I for one bought into back last year.
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Post by Ton ⓉⓞⓃ on Apr 22, 2014 20:36:41 GMT
9% interest I could cope with, but a PG from somebody who, for all I know, has his other businesses in the same rocky condition, is not worth much. Presumably this guy has some bricks & mortar somewhere we could get a charge against - or is that already charged to somebody else? Business-wise, the plan just seems to be to expand on what he's been doing for the past 10 years without success. If the product doesn't sell well enough to make a profit online and in London, what's so magic about New York? As far as Assetz is concerned, maybe they just didn't want to go into the long weekend with nothing on offer? But to be fair in 2011 the business was a success, as far as I can remember it was in profit in that year. No doubt there will be many to correct me if I'm wrong.
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Post by mrclondon on Apr 22, 2014 21:56:39 GMT
Whilst I'm not sure of the degree of relevance of Mulberry's financial woes ( 4 profit warnings in 2 years, 2 in 2014 - Telegraph last week) on our borrower, they must be a competitor to some degree, and experience similiar sorts of market issues.
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Post by mrclondon on Apr 22, 2014 22:30:59 GMT
With my banking hat on, this is a good deal and is priced in lined with traditional banking hat on. Perhaps those of us who have lost money on shares in "traditional banks" aren't interested in supporting "traditional banking" deals. There is asset security in the debenture with high levels of stock. Stock is listed at cost price, not retail. Even at 50% cost price there is enough stock to clear our loan and the other loan. Possibly today, but I note there is no covenant proposed to cover minimum stock+debtor value. however these types of deals fill on other sites But perhaps not as easily as they did 12 months ago. FWIW I don't support many auctions on TC precisely because the security is generally weak. I do support debenture backed loans, but only on a 1st charge , and only where there is an appropriate supporting covenant. And not at 9%. Clearly AC has to grow, and market testing various deal types along the way is to be expected. However I think we are in danger of losing sight that this thread is about more than just level of security this loan offers. The credit report, in my view, contains a number of fundamental accounting errors; and regretably the answers provided on the Q&A today are so far off the mark as to raise serious concerns in my mind about the rigour with which AC are sense checking what they are doing against what the regulator would reasonably expect them to be doing. Is this credit report really of a quality suitable for a retail investor audience ? I think not.
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bugs4me
Member of DD Central
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Post by bugs4me on Apr 22, 2014 22:47:09 GMT
Emotions running high, so I will forgive some of the more acerbic comments. I will say I am a promoter of a free, independent forum but that does not mean abuse or derogatory comments can be made about my staff or anyone connected with this deal. Firstly, David Ricketts ran the credit in my absence BUT I WAS INVOLVED THROUGHOUT despite being on holiday. It was on my say so that this deal went on the system. If you want someone to shoot at, shoot at me. In banking terms this is a pure cash flow loan. The business is cash generative (see EBITDA as a proxy for cash) by about £1m a year. As a rule of thumb, you would want full amortisation over 3-5 years, debt no higher than 2.5x EBITDA, and reliance on cash flow. Losses are caused by non cash items of depreciation and amortisation. This is an accounting correction of the goodwill on the balance sheet. Stripped out, this business is profitable. In this case we have debt at 0.5x EBITDA and full amortisation over 3 years with strong cash flow in the business. This is a true cash flow loan. There is asset security in the debenture with high levels of stock. Stock is listed at cost price, not retail. Even at 50% cost price there is enough stock to clear our loan and the other loan. With my banking hat on, this is a good deal and is priced in lined with traditional banking hat on. As a business, we are widening the types of deals we offer. In some ways we have spoilt you with lots of property, but a lack of it doesn't make it a bad deal. I stand by my decision to list this auction. I can not ask you to lend nor can I make a recommendation, however these types of deals fill on other sites and AC is widening its appeal by offering further diversification. I'll not make any further comment. I do not believe anyone is being either abusive or derogatory towards AC staff Andrew. Yes there may have been some light hearted throw away comments but that's all they are. The problem IMO with this loan is that it is outside of the normal trading terms for AC and therefore it follows there will be more questions asked and above normal discussions regarding it's merits or lack of them. Many contributors, myself included, have been burnt by so called personal guarantees on other platforms. So when a loan is offered, with a PG attached you'll understand my apprehension when there is not full disclosure as to what substance is behind the PG. It is of little help when this information, whilst being available to AC, the borrower wishes for it to remain confidential. I have no objection to AC widening the types of deals on offer as it is after all not my business so that is entirely the prerogative of the company. Whether pure PG type loans are for me I very much doubt it.
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