THE HONEYCOMB investment trust started the year with its net asset value (NAV) up 0.66 per cent.
The January performance figure is down from 0.79 per cent in December 2017 but is the first that includes new IFRS 9 rules that take account of any expected credit losses when valuing loans.
“The strong NAV return performance was driven by the combination of strong underlying income yield on the portfolio and low bad debts,” Honeycomb said in a January update announced on the stock exchange on Wednesday.
New accountancy disclosures are being introduced for companies whose financial year began on or after 1 January 2018 and the alternative lending-focused investment trust is among the first to report how it will be affected.
Honeycomb has 65 per cent of its portfolio dedicated to consumer loans, 31 per cent to property and four per cent to small business lending.
“The portfolio continues to be weighted towards assets which either have downside protection or seasoning which the manager believe will provide lower volatility in a more challenging economic environment,” Honeycomb said.
“The pipeline remains strong across the three sectors with than £750m of opportunities at various stages of development.”
The fund has also declared an interim dividend of 20p per ordinary share for the three-month period to the end of December 2017.
Honeycomb’s investment manager, Pollen Street Capital, completed its acquisition of a controlling stake in MW Eaglewood last September, creating one of Europe’s biggest alternative finance-focused investment managers.
MW Eaglewood, which manages P2P Global Investments, has been renamed PSC Eaglewood.