In May, Estateguru’s crowdfunding platform saw €8,2M worth of new loans. Our sales team is concentrating on the Baltics and Finland: in Estonia the volume was €4,0M, in Lithuania €1,4M, in Latvia €1,9M and in Finland €0,8M. We are seeing an increase in investment from institutional investors, to further support growth.
During the recent months the return of repayments has been around 9,0%. The repayment amount is stable, with an average monthly volume of €7,5M over the last 3 months.
In May we recovered one of the long-term defaults in Latvia. The auction in this case was successful, but the funds (€0,1M) were initially held up due to a legal dispute. After settlement with the borrower, the funds were recovered. The main focus of the risk and legal department during 2023 has been and continues to be the recoveries in Germany, Finland and Lithuania. However, we are also improving our credit quality by taking the following steps:
1) A new credit policy including lower concentration risk limits, higher valuation standards, more emphasis on repayment ability and borrower background etc. 2) A new loan application (credit memo) project with a focus on the needs of institutional investors, which will also benefit retail investors. 3) Integration of Moody’s ratings. 4) Risk based interest rate calculation project. 5) A middle office and document management upgrade regarding loan documents. 6) A shift in the Operations team’s focus to more proactive late loan management.
We will keep you informed about the credit portfolio quality monthly.
