PEER-TO-PEER investor BondMason is planning to issue a series of bonds with one to three-year maturities after raising £1.85m in equity funding, the company’s chief executive told Peer2Peer Finance News.
Stephen Findlay (pictured), said BondMason plans on offering bonds with one, two, and three-year maturities backed by a set of “curated loans” that will be similar in creditworthiness, regardless of the maturity of the bond.
“The key distinction (between the bonds) will be their length,” said Findlay.
“In terms of their risk position we are very much taking a conservative approach.”
BondMason only had one of its loan investments fail last ear, according to Findlay, which indicates that the company invests in loans that have a high likelihood of repayments.
BondMason is planning on issuing bonds on a quarterly basis at first, with the potential of monthly issuance “depending on demand,” said Findlay.
The company is still talking to advisors and analysts about the interest rates, though as with most bonds, longer maturities will offer higher returns.
BondMason already offers returns of eight per cent and higher in its existing product line.
“We’re targeting June for the bonds,” said Findlay. “The advisors and lawyers have been appointed.”
BondMason announced last month that it had raised £1.85m in equity funding from private investors, as well as venture capital from Par Equity and investment managers Seneca Partners.
As well as funding the new bond launches, BondMason plans to use the proceeds to improve its service by launching an Innovative Finance ISA, improve its platform interface and develop a pension service.
Findlay said BondMason is in a strong position to provide pension investments because the company’s investment criteria automatically diversifies clients’ holdings , meaning their pension products will not run afoul of regulations that prevent pension investors from being able to access money early.
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This feature appeared in the April issue of Peer2Peer Finance News, now available to read online.