Post by bikeman on Aug 12, 2017 16:48:07 GMT
There is also the possibility that less desirable loans are not invested in by MLIA investors and get picked up by the funds leading to them becoming disproportionately full of bad loans.
The AC disrcretionary provision fund certainly pays out later than both the RS and Growthstreet funds for example. I don't think we'll find many lenders that like that but it is what it is based on how AC works which I accept. AC refuses to give any advanced guidance on whether a specific loan will be covered by the provision fund, for example when lenders have asked the question when being asked to vote on a problem loan. It may be many months/years before we see the provision fund pay out on a loan so we can see how much of a loss it will cover.
As for your second point. Yep there are certainly some less desirable loans in the GBBA for example based on some lenders experience of trying to withdraw their GBBA money which has taken some time. That is a feature of AC again.