Monthly origination summary for September 2017

Loans issued in September reached €3,058,844 surpassing the performance of every month in 2017 except January. In fact, September was so strong that originations exceeded the running average for 2017 by €180,131. The growth supports the good news seen in our September 25th post announcing that we successfully funded over €100 million in loans. This momentum comes from more than 28,850 investors who have placed their trust in our platform. Our user base now spans 85 countries and we believe our September origination performance reinforces the value of a transparent marketplace that empowers lenders and borrowers alike.

Loan origination by country

Estonia provided the largest share of originations at 59.61% with Finland following at 27.09%, then Spain at 13.30%. These figures are only in slight contrast to last month where Spain held a mildly larger portion at the expense of Finland. September marks the second month where Estonia’s share dropped below 60%. However, it seems that this decrease has likely abated and that we’ve reached an equilibrium where the proportions across the three countries will probably not change dramatically. For example, relative to the start of the year the largest shift in proportions came from Estonia which held 62.89% of the total, a mere difference of 3.28 percentage points. In fact Spain only moved half of one percentage point in September relative to January.

Share by country – September 2017
Country Interest Amount Share
ESTONIA 21.50% 1823315 59.61%
SPAIN 117.09% 406867 13.30%
FINLAND 52.41% 828662 27.09%

Loan origination by rating

Once again, the concentration is highest within “C” rated loans at 17.83% offering the blend of higher returns with a reasonable level of risk. Limited offerings in the “AA” and “A” rated loans keep them at the lowest portions, 5.68% and 5.28% respectively.

  • “Investors had little consensus regarding risk as the “B” through “HR” loans showed a roughly equal amount of proportionality with only 6.44 percentage points separating the highest portion (“C” rated) from the lowest (“F”).
  • Nearly half (49.16%) of all originations fall within the “C,” “D,” and “HR” ratings signalling a more cavalier attitude towards risk. This pursuit of higher returns may indicate that marketplace lenders are competing with the recent strong performance of the stock market.
  • Despite a higher interest rate, the “F” rated loans are relatively small in proportionality at just 11.39% due, in part, by the availability in only Spain and Finland.
  • Spain’s total interest of 117.09% may stem from the outsized demand for riskier but more profitable “HR” loans.
  • The greatest country/rating share is Estonia’s “C” rated loans at 16.26% of the total. This may be partially due to the fact that, historically, recovery rates have been slightly higher in Estonia giving investors more confidence.
Share by country and rating – September 2017
Rating Interest Amount Share Interest Amount Share Interest Amount Share
AA 10.05% 151551 4.95% 9.48% 22319 0.73%
A 11.82% 147508 4.82% 12.11% 14051 0.46%
B 15.09% 397247 12.99% 14.56% 61132 2.00%
C 20.91% 497451 16.26% 24.15% 6335 0.21% 22.03% 41586 1.36%
D 28.81% 379306 12.40% 27.58% 14104 0.46% 28.42% 88009 2.88%
E 34.39% 250252 8.18% 38.17% 40352 1.32% 38.60% 122109 3.99%
F 57.83% 77403 2.53% 53.13% 271115 8.86%
HR 152.91% 268673 8.78% 94.19% 208341 6.81%
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