Administrators of collapsed peer-to-peer lenders have clocked up more than £5m in fees so far from the sector’s largest closures but are struggling to recover more than a third of the loanbooks.
Analysis by Peer2Peer Finance News has shown that the administration costs for Lendy, FundingSecure, Collateral, MoneyThing and The House Crowd are mounting up, while many investors are still unclear on how much they will be repaid.
Administrators can charge for anything from managing loanbooks to dealing with recoveries and answering press queries.
Collateral was one of the first P2P lenders to enter administration in February 2018.
It has already moved into liquidation and its administrator BDO has earned £677,163.
The firm has recovered £2.2m from a property loanbook worth £14.8m, equivalent to 14.8 per cent, but is still working on recoveries for Collateral’s pawnbroking assets.
RSM has been paid £3.7m since taking on the administration of Lendy when it collapsed in 2019.
During this period, it has recovered £46m of the £117m development finance loanbook and £12.8m of the £32.9m lent to bridging borrowers.
That means 39.2 per cent of the loanbook has been recovered.
There are still 16 live development loans with a value of £83.1m but 11 of these have entered insolvency proceedings, RSM said.
Of the 31 live bridging loans with an outstanding value of £34.6m, 28 have entered insolvency.
RSM has said it is still not possible to say when the administration, which has already been extended by three years, will end.
In contrast, CG&Co, which was named administrator of FundingSecure when it collapsed in October 2019, has been paid costs of £593,575 so far.
The loanbook was valued at around £80m at the time of the administration but CG&Co has already written off several bad loans that took the value to £56.6m.
It has recovered 41.5 per cent of this figure at £23.5m and said there are still 95 remaining defaulted loans to recover with £47.7m invested but there is no indication of when this will complete.
The FundingSecure administration has also been extended by three years.
The House Crowd, which only went into administration in February 2021, has already generated time costs of £283,525 for its administrator Quantuma.
Meanwhile, Moorfields Advisory, which was appointed administrator of MoneyThing when it closed in December 2020, had incurred costs of £126,665 up to February 2021 and has estimated the total administration’s fees will be £358,872.
Administration fees have become a hot topic of late.
It was revealed in March that the administration costs of collapsed mini-bond provider London Capital & Finance are expected to total £7.7m by next January.
The latest progress report from joint administrators Smith & Williamson revealed that fees have already reached £5.6m.