mason
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Post by mason on Apr 7, 2017 17:22:13 GMT
Everyone seems to have missed the three words at the end of the statement that paul made. "However, at the current time our policy states that ''the Fund will aim to have a minimum balance of 2% of the total live loan amount at any time,” and it will." Implying that Lendy will maintain the balance. Perhaps you missed the word aim. So the fund will aim to have a minimum balance of 2% - meaning it could be empty as long as the aim is for 2%. The FCA would likely not allow Lendy to guarantee the PF will always be maintained at 2% or above.
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Post by portlandbill on Apr 7, 2017 17:25:15 GMT
Everyone seems to have missed the three words at the end of the statement that paul made. "However, at the current time our policy states that ''the Fund will aim to have a minimum balance of 2% of the total live loan amount at any time,” and it will." Implying that Lendy will maintain the balance. Perhaps you missed the word aim. So the fund will aim to have a minimum balance of 2% - meaning it could be empty as long as the aim is for 2%. The FCA would likely not allow Lendy to guarantee the PF will always be maintained at 2% or above. That was the point I was making
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mason
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Post by mason on Apr 7, 2017 17:32:28 GMT
Perhaps you missed the word aim. So the fund will aim to have a minimum balance of 2% - meaning it could be empty as long as the aim is for 2%. The FCA would likely not allow Lendy to guarantee the PF will always be maintained at 2% or above. That was the point I was making Indeed, although I don't think there is any doubt over what the statement actually means. The exchange with Paul regarding the PF brings back memories of this: youtu.be/Uwlsd8RAoqI?t=175
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twoheads
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Programming
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Post by twoheads on Apr 7, 2017 17:35:49 GMT
Very pleased with Lendy's recent update particularly around provision funds. As we know the FCA are not at all happy with the way some platforms use provision funds and I am glad that Lendy are making their position clear. Investors should not be lending on the basis of the existence of a provision fund and therefore as I have said before I am more than happy not to know how much is in it. Does this imply that you would be less than happy if you knew how much is in it?
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registerme
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Post by registerme on Apr 7, 2017 17:46:22 GMT
That's a surprising statement. And - not surprisingly - it's been dropped from the general update released today, in favour of a more toned down 'see a PFA'. So the forum is good for something. 'Soft launch' comms here, see which bits cause consternation and then modify accordingly. Well yes, regardless of who made the statement initially no platform should ever say anything so daft  .
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Post by meledor on Apr 7, 2017 17:48:25 GMT
Very pleased with Lendy's recent update particularly around provision funds. As we know the FCA are not at all happy with the way some platforms use provision funds and I am glad that Lendy are making their position clear. Investors should not be lending on the basis of the existence of a provision fund and therefore as I have said before I am more than happy not to know how much is in it. Does this imply that you would be less than happy if you knew how much is in it? This might be useful for the use of the expression "more than happy"!
english.stackexchange.com/questions/275808/is-i-am-more-than-happy-to-help-you-grammatically-correct
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Post by meledor on Apr 7, 2017 18:08:56 GMT
And - not surprisingly - it's been dropped from the general update released today, in favour of a more toned down 'see a PFA'. So the forum is good for something. 'Soft launch' comms here, see which bits cause consternation and then modify accordingly. Well yes, regardless of who made the statement initially no platform should ever say anything so daft .
I had no problems with the original - it was spot on. As well as negativity this board seems to be fond of pedantry. I trust that as 'concerns' have been expressed about Lendy loans then most posters are now talking to their financial advisers!
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stub8535
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personal opinions only. Not qualified to advise on investment products.
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Post by stub8535 on Apr 7, 2017 18:26:03 GMT
Maybe the best solution to lenders not understanding the term "discretionary" is to abolish the provision fund. Gripes over!
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registerme
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Post by registerme on Apr 7, 2017 18:33:45 GMT
I disagree meledor. There is no such thing as a zero risk financial proposition. Even if you kept all your assets in index linked government bonds you'd be open to the risk of opportunity costs. So for a platform to make a statement saying " don't invest if you have any concerns" (abridged, but the same emphasis as used on the original) simply means "don't invest, full stop". That struck me as a silly, not to mention incorrect, position for a platform to take. |
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Post by meledor on Apr 7, 2017 18:52:15 GMT
I disagree meledor . There is no such thing as a zero risk financial proposition. Even if you kept all your assets in index linked government bonds you'd be open to the risk of opportunity costs. So for a platform to make a statement saying " don't invest if you have any concerns" (abridged, but the same emphasis as used on the original) simply means "don't invest, full stop". That struck me as a silly, not to mention incorrect, position for a platform to take. I see nothing in the statement that equates 'concern' with risk levels. I look at lots of investment opportunities on a daily basis and if I have any concerns then I do not invest. That seems all very straightforward and logical. You are entitled to your view but I think you are looking for problems that are not there.
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mason
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Post by mason on Apr 7, 2017 18:55:24 GMT
I disagree meledor . There is no such thing as a zero risk financial proposition. Even if you kept all your assets in index linked government bonds you'd be open to the risk of opportunity costs. So for a platform to make a statement saying " don't invest if you have any concerns" (abridged, but the same emphasis as used on the original) simply means "don't invest, full stop". That struck me as a silly, not to mention incorrect, position for a platform to take. I see nothing in the statement that equates 'concern' with risk levels. I look at lots of investment opportunities on a daily basis and if I have any concerns then I do not invest. That seems all very straightforward and logical. You are entitled to your view but I think you are looking for problems that are not there. I have concerns about investing in several asset classes, yet I continue to do so because the alternatives are even worse (including the guaranteed loss of spending power of my capital if I don't invest at all).
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Post by meledor on Apr 7, 2017 19:07:48 GMT
I see nothing in the statement that equates 'concern' with risk levels. I look at lots of investment opportunities on a daily basis and if I have any concerns then I do not invest. That seems all very straightforward and logical. You are entitled to your view but I think you are looking for problems that are not there. I have concerns about investing in several asset classes, yet I continue to do so because the alternatives are even worse (including the guaranteed loss of spending power of my capital if I don't invest at all).
All very well but you are talking about asset classes. The statement was referring to a particular loan or investment opportunity. I invest when I have dealt with any concerns. I invest with conviction, if I have doubts I pass; there are plenty of other opportunities. Of course I can be wrong, my research can be faulty etc but that is another matter.
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mason
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Post by mason on Apr 7, 2017 19:19:59 GMT
I have concerns about investing in several asset classes, yet I continue to do so because the alternatives are even worse (including the guaranteed loss of spending power of my capital if I don't invest at all).
All very well but you are talking about asset classes. The statement was referring to a particular loan or investment opportunity. I invest when I have dealt with any concerns. I invest with conviction, if I have doubts I pass; there are plenty of other opportunities. Of course I can be wrong, my research can be faulty etc but that is another matter.
If I have concerns over the asset class, then that naturally cascades into every investment opportunity within that asset class. I guess " any concerns" means different things to different people. To me it includes macroeconomic concerns as well as those specifically mentioned in a financial promotion. Some way up the thread I commented that any statement about concerns about an investment opportunity should apply equally to platform and loan. I believe that quite strongly, which is why at the beginning of the year I sold quite a few loans I would have been more than happy to hold had they been on a different platform. In this case, unlike the case of asset classes, there are alternatives where I believe the same risks do not exist, so like you, I went with my convictions.
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GeorgeT
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Post by GeorgeT on Apr 7, 2017 20:54:45 GMT
My issue with the provision fund is that it probably give investors a false sense of security and may encourage people to invest money in dodgy loans because they think they are covered and protected from losses.
My personal view is that if a provision fund exists then lenders should be told how much is in it. However it is clear we are not going to be told now that it has been substantially depleted following the recent default of the garden centre.
If we are not going to be told how much is in it then I would question the point of having it in the first place. Clearly a provision fund with £10,000 in it is worthless.
If Lendy are going to continue to keep the amount in the Provision Fund a secret then I would suggest they would be better off announcing they have scrapped it altogether and perhaps add 0.5% interest to future loans to compensate investors for any very slight additional risk.
If there was a very substantial amount in the provision fund in the millions then Lendy would be crowing about it from the rooftops. They aren't, in fact they are doing the opposite of that. That tells me all I need to know and I totally disregard it in my investment decisions on this platform. I suggest others should do likewise. The garden centre should in no way be regarded as a precedent because it was the first substantial default and for reputation management purposes it was deemed necessary for Lendy to ensure there were no losses. That was a one-off.
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vmail
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Post by vmail on Apr 7, 2017 21:17:50 GMT
Another £2m to be added to the defaults pot this month.
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