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Post by stevefindlay on Apr 10, 2017 16:24:44 GMT
All clients will receive an email shortly with an update to our T&Cs. The key changes are: Revised account and transaction limits
- Minimum account balance: £5,000
- Minimum deposit amount: £250
- Minimum withdrawal amount: £20
As discussed elsewhere on this forum, we've identified that clients with bigger balances have less volatile returns and are more likely to achieve investment performance in line with the target return. We want all of our clients to have a fantastic investment experience through BondMason, and for this reason we are increasing the minimum account balance to £5,000. Existing clients with balances of less than £5,000 will have until 31 July to decide to: - Option 1: Increase their balance to the minimum of £5,000
- Option 2: Liquidate
- Option 3: Run-off
Further details are set out in the email sent to clients. Revised fee structure
- 1.5% p.a. on investment amounts up to £25,000
- 1.25% p.a. on investment amounts from £25,001 to £100,000
- 1.0% p.a. on all invested amounts over £100,000
This will enable us to continue to deliver first-class customer service, and allow our dedicated investment team to remain focused on sourcing the best quality loans, increasingly form non-P2P lending partners which requires bespoke legal agreements and operational investment. We will be updating our marketing literature over the coming days to reflect the gross target of 8.0% p.a. (before fees) Thank you for your continued support.
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pauls
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Post by pauls on Apr 10, 2017 16:42:59 GMT
Thats disappointing. However I do understand the reasoning. As an investor in the less than £5k bracket I will have to think carefully regarding my options. Would I be better off somewhere else is the question I am asking myself. If I do withdraw or selloff I will miss BM and the inputs from stevefindlay. Good luck all. |
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Post by khampson on Apr 10, 2017 16:44:10 GMT
Changes to the BondMason Terms & Conditions
We have been delighted with the support we have received from our clients over the last two years and we would like to thank you for your custom. We are making a few changes to our Terms and Conditions to enable our clients to continue to access attractive returns from a diverse and exclusive range of lending partners.
As we aim to be transparent, we are providing advance notice of the changes, prior to these being effective from 31 May 2017:
Revised account and transaction limits
Minimum account balance: £5,000
Minimum deposit amount: £250
Minimum withdrawal amount: £20
Revised fee structure
1.5% p.a. on investment amounts up to £25,000
1.25% p.a. on investment amounts from £25,001 to £100,000
1.0% p.a. on all invested amounts over £100,000
Accessing exclusive lending opportunities
These changes are essential for us to continue to deliver first-class customer service, and allow our dedicated investment team to remain focused on sourcing the best quality loans.
We now source over 40% of our loans from outside of P2P Lending platforms due to the attractive opportunities available from proven lending companies. This involves building new and exclusive relationships with specialist lenders. These relationships require bespoke legal agreements, and a dedicated operational infrastructure.
Our revised fee structure will enable us to focus on developing more of these relationships, which will benefit all our clients by providing access to attractive risk-adjusted returns from loans that would not otherwise be available.
Targeting gross returns of 8% p.a.
We remain committed to enabling clients to achieve gross returns of 8.0%+ pa. Since starting in 2015, our clients have achieved an average gross return in excess of 8.0% p.a. in each of 2015, 2016 and 2017 to date.
We’ve identified that clients with larger balances have less volatile returns and are more likely to achieve investment performance in line with the target return. We want all of our clients to have a fantastic investment experience through BondMason, and for this reason we are increasing the minimum account balance to £5,000.
The revised fee structure means that the return target after fees will be close to the original net target of 7.0% p.a.:
Client balance Gross target Net target
Old New Old New
£10,000 8.0% 8.0% 7.0% 6.5%
£25,000 8.0% 8.0% 7.0% 6.5%
£50,000 8.0% 8.0% 7.0% 6.6%
£100,000 8.0% 8.0% 7.0% 6.7%
£250,000 8.0% 8.0% 7.0% 6.9%
Your options if your account balance is less than £5,000
We value your custom and hope that you will remain with BondMason. Here’s an overview of the options available to you.
Option 1: Increase your balance: If you would like to retain your account with us, you are invited to deposit further funds to bring your balance up to £5,000. The deadline for increasing your balance to the new minimum amount is Monday 31st July 2017
Option 2: Liquidate: if you would prefer to liquidate your positions and withdraw your funds, then we can arrange this for you. You can do this any time up to 31 July 2017. Please contact us at invest@bondmason, or use the normal withdrawal process from your dashboard.
Option 3: Run-off: Clients with balances below £5,000 can also choose to put their accounts into run-off after 31 July 2017. This means funds will no longer be reinvested, and monies will be paid to you on a monthly basis, as underlying positions are repaid. This option will be chosen for clients with account balances below £5,000 on 31 July 2017.
If you have any questions, please contact us at invest@bondmason.com.
Thank you for your continued support and we look forward to enabling you to continue to achieve attractive risk-adjusted returns from Direct Lending in 2017 and beyond.
Yours sincerely,
Steve
Stephen Findlay
CEO
BondMason
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nush
Member of DD Central
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Post by nush on Apr 10, 2017 17:05:13 GMT
delighted enough to lower the returns and up the risk, nice one
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adrianc
Member of DD Central
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Post by adrianc on Apr 10, 2017 17:12:54 GMT
That's a fairly beefy fee hike - 50% increase for <£25k balances, 25% for £25k-100k...
Reading between the lines, it looks like more investors than loans, so trying to lose the (presumably larger number) of small-hitters.
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Post by Deleted on Apr 10, 2017 17:24:09 GMT
That's a fairly beefy fee hike - 50% increase for <£25k balances, 25% for £25k-100k... Reading between the lines, it looks like more investors than loans, so trying to lose the (presumably larger number) of small-hitters. To be honest, if that's all that it is, along with the expense of sourcing and securing the loans, then that would be ok. Something which concerns me: Lots of accounts will be liquidated I expect. So the receivables from those accounts will be put into accounts which don't liquidate. Some of those receivables are already in default - what will happen to those ones? What will happen to the receivables from the less reliable invoice discounting firms which are no doubt in some of these BM accounts? Will we who stay be lumped with them?
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adrianc
Member of DD Central
Posts: 10,071
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Post by adrianc on Apr 10, 2017 17:45:23 GMT
Something which concerns me: Lots of accounts will be liquidated I expect. So the receivables from those accounts will be put into accounts which don't liquidate. Some of those receivables are already in default - what will happen to those ones? What will happen to the receivables from the less reliable invoice discounting firms which are no doubt in some of these BM accounts? Will we who stay be lumped with them? Anybody with a larger account will already be exposed to invoice discounting reasonably heavily. By the time these changes come in, the reduction in ID exposure will already be in place (we hope!), and ID is by nature short-term, so I don't think it's going to be too big a problem. Any re-distribution of pre-defaulted loan parts would bring a bloody serious sense-of-humour failure on the part of the FCA, I would imagine. Given that the exposure is already flagged to a customer, I'd have thought it'd stay with them, because the only way is up via recoveries - which would then be allocated to those liquidated customers. Distribution from that would, I assume, occur in the form of a nice little surprise for the ex-customer...
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Post by stevefindlay on Apr 10, 2017 18:08:03 GMT
Receivables relating to underlying loans which are in default, and not able to be sold or bought across BondMason. They are locked to current investor who holds them.
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Post by Deleted on Apr 10, 2017 18:09:40 GMT
An inevitable development having read a few of Steve's comments recently. I've been trialling Bondmason with 1k and have very much liked what I've seen, provides me with some diversification and portfolio management while I concentrate on a few other platforms. Having said that I've been hanging on for an IFISA launch before depositing further. Unfortunately I think I'll be leaving in the meantime with a view to returning if this becomes a reality. stevefindlay is the IFISA still being pursued or are you concentrating solely on SIPPs for the moment? |
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nd
Member of DD Central
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Post by nd on Apr 10, 2017 18:20:15 GMT
The introduction of the minimum is no surprise and it's fully understandable that BM want a minimum income per investor. The increase from 1% - 1.5% at my level of funds is disappointing but if this T&C change means BM can keep me consistently around 100% invested due to fewer investors sharing the same pot of loans (rather than the 90% mark I've had recently) then the increase should be covered by higher returns.
I like the approach of BM and the openness of communication so I'm happy to give it a go on this new basis and hope that BM can demonstrate that the 1.5% fee is worthwhile.
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ben
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Post by ben on Apr 10, 2017 18:32:45 GMT
This does not effect me and I understand where bondmason are coming and can see the reasons behind this.
However I am pretty disappointed with this decision, and may actually remove my account as well because of this. A lot of forum members on here may well be under the limit and many of whom have given Bondmason valuable feedback and helped to promote them, to then be told sorry we are bigger now and we no longer need you is not really an acceptable business practice.
I can understand you having this set for new members but to kick out members that have already invested is not really fair and there is no real need to.
I actually also find it quite amusing that bondmason advrertise there link to Kiva and then go and do this, hardly within the spirit of that.
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ben
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Post by ben on Apr 10, 2017 18:48:41 GMT
Forgive me ben but how does this not effect you? Everyone pays an extra 0.5% for their first £25k. I should have mentioned that I was stating about the 5K min investment, I aslo misread that but thanks for pointing it out
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Greenwood2
Member of DD Central
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Post by Greenwood2 on Apr 10, 2017 19:27:11 GMT
I was thinking of suggesting an increase of fees to cover defaults, not a provision fund as such but an amount of fees used to cover defaults or be returned to lenders. Seems like BM have a different agenda. Is the target return still 7% for all lenders? (I assume not) Or some complicated mix of 6.5%, 6.75% and 7% depending on investment amount making it even more difficult to decide if you get the target rate.
That together with the 1%-2% diversification may make it not worthwhile for me, unless defaults are brought much more under control. £100,000 with 2% diversification giving a potential loss of £2000 on a single loan is a bit much for me. And the increased fees below this level are unattractive.
Edit: Just starting to wind my investment up, now a rethink required.
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ben
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Post by ben on Apr 10, 2017 19:33:06 GMT
I was thinking of suggesting an increase of fees to cover defaults, not a provision fund as such but an amount of fees used to cover defaults or be returned to lenders. Seems like BM have a different agenda. Is the target return still 7% for all lenders? (I assume not) Or some complicated mix of 6.5%, 6.75% and 7% depending on investment amount making it even more difficult to decide if you get the target rate. That together with the 1%-2% diversification may make it not worthwhile for me, unless defaults are brought much more under control. £100,000 with 2% diversification giving a potential loss of £2000 on a single loan is a bit much for me. And the increased fees below this level are unattractive. If they could set it so you payed tax on your actual returns rather then including the fees would make it more attractive.
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Greenwood2
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Post by Greenwood2 on Apr 10, 2017 19:38:13 GMT
BM say it's not possible, but other platforms have changed it to a 'Platform Operation Cost' or something and deducted it before it is paid to lenders, so we would not have to pay tax on it, over to BM.
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