Lend & Borrow Trust to surrender FCA licence and liquidate
Lend & Borrow Trust is set to surrender its regulatory permissions before going into liquidation.
The precious metals-backed peer-to-peer lending platform was authorised by the Financial Conduct Authority (FCA), but it intends to return its licence by the end of the month.
According to the company’s most recent statement of accounts, during its final year of trading it saw its losses widen from £1,650,244 in 2020 to £1,815,616 in 2021.
Canadian investment firm Goldmoney acquired Lend & Borrow Trust in 2019 for an undisclosed amount.
Lend & Borrow Trust allowed investors to fund loans secured by physical precious metals such as gold and silver. According to Goldmoney, by August 2019 Lend & Borrow Trust had financed £16.5m of fully reserved precious metal loans with a minimum interest rate of 3.75 per cent.
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The platform’s final financial statement appeared to show that the cost of storing precious metals had risen dramatically for the firm, from £17,053 in 2020 to £72,801 in 2021, with the 2021 storage fees covered by Goldmoney. However, a spokesperson for Lend & Borrow Trust told Peer2Peer Finance News that the difference in storage costs “simply results from a change of internal arrangements between Lend & Borrow Trust and its parent company GMI, which took place towards the end of the financial year 2020 and therefore shows a partial amount for 2020.”
The company’s directors said that they expect the IT platform to be written off with “no future economic benefit anticipated”.
“The company has ceased trading and will be surrendering its FCA licence at the end of January 2022,” the directors wrote.
“The directors intend to liquidate the company as soon as the licence has been surrendered, therefore on this basis, the company is no longer considered a going concern.”
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