RateSetter pushes back legacy wholesale lending repayment date
RATESETTER’S exposure to its discontinued wholesale lending portfolio will take longer to be repaid than first anticipated, the peer-to-peer lender has revealed.
The platform discontinued wholesale lending at the end of 2016 and acquired three companies associated with a former partner – Vehicle Credit Limited (VCL), Vehicle Stocking Limited (VSL) and Adpod Limited – to protect customers from any losses from the loans.
This added a £51.4m debt to Ratesetter’s balance sheet, which it had intended to have repaid through proceeds from the loans and future lending by August 2022.
The debt balance has been reduced to £25.9m but RateSetter has now moved the final repayment date to August 2024 due to slower growth in lending by the companies.
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“We have reviewed the repayment profile in place for the loans,” RateSetter said in an update to investors.
“Proceeds from the loans have been in line with expectations, but future lending slowed during the process of integrating the companies into RateSetter.
“Because of the slower growth in this area, we have decided to move the final repayment date for the balance of the debt to August 2024 with repayments of capital and interest continuing to be made monthly from the proceeds of the loans, profits from future lending and support from RateSetter.”
The legacy wholesale portfolio represents just three per cent of its overall loanbook.
Read more: FCA urges P2P platforms to take action over wholesale lending