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Peer2Peer Finance News | September 18, 2019

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Woodford offloads stakes in P2PGI and VPC

Woodford offloads stakes in P2PGI and VPC
Kathryn Gaw

FUND MANAGER Neil Woodford has fully divested from peer-to-peer investment trusts P2P Global Investments (P2PGI) and VPC Specialty Lending (VPC).

Woodford’s investment management firm had previously held a 13 per cent stake in P2PGI and a 16.6 per cent share in VPC, and manager Neil Woodford was widely considered to be one of the key champions of P2P investing.

He was was one of P2PGI’s earliest and largest investors when it was launched in January 2015. However, P2PGI has suffered from volatility in its share price and net asset value (NAV) in recent months.

Earlier this month, P2PGI said that it expected more volatility in the year ahead thanks to its UK consumer portfolio “where the overall net yield is significantly below target and has displayed monthly volatility throughout the year.”

In 2017, P2PGI switched its focus from consumer loans to asset-backed lending, but it is still in the process of running down its legacy portfolio.

In its most recent investment update, P2PGI blamed its Zopa legacy portfolio for a declining NAV, but added that it had reduced its run-off portfolio to just 13 per cent of its overall exposure.

The investment trust is currently trading at a discount to NAV of 14.4 per cent. In the months following its launch 2015, P2PGI was trading at a 15 per cent premium to NAV.

Meanwhile, VPC has reported capital losses over the past few months, as it has pursued a share buy-back programme in an effort to narrow its 15.8 per cent discount to NAV.

At the time of writing, Woodford still owned a 21 per cent stake in P2P investment trust Honeycomb.

His Woodford Patient Capital investment trust also has a share in RateSetter.

Read more: Consumer P2P loans weigh on P2PGI fund returns