Assetz Capital said investor trading on its manual lending account secondary market is returning to typical levels, after a spike in sales at the start of the pandemic.
The peer-to-peer business lender’s secondary market allows investors in its manual lending product to apply a discount to their loan parts if they are keen to sell.
Assetz said that trading activity up to the first full week of March was broadly unchanged, with most sales made at a zero discount.
However, as the pandemic took hold from mid-March, investors looked to sell quickly. This discounted trading activity peaked in April, reaching an average of 6.8 per cent discount between willing buyers and sellers.
However, this discount level fell back to just 1.7 per cent this week and is still falling, Assetz said.
Some discounted offers were taken up by buyers, while some sellers had changed their minds about selling and cancelled their offers.
Investors are already back to buying 100 per cent of their typical previous value of loans on the aftermarket per week, Assetz said.
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“This is encouraging data and it shows that there was minimal investor panic as the worst of the uncertainty around the pandemic hit investor and economic confidence,” said Stuart Law (pictured), chief executive of Assetz Capital.
“What is more, the worst moment in this market was brief, just a few weeks, and modest discounts quickly attracted bargain hunters to enable those who wanted to exit the manual lending account to do so.
“Given the 40 per cent fall in the value of the FTSE 100 and the failure for that to substantially recover so quickly we take this as a sign of strong confidence in our property secured lending.”
Law said Assetz is planning to offer a similar trading facility for its auto-invest accounts to provide greater liquidity for those investors.
Last month Assetz announced that withdrawal requests from its access accounts have returned to normal levels.