Funding Circle returns decline in Germany but stable across other markets

PROJECTED returns after fees and bad debts have fallen in Funding Circle’s German business but remain stable across the peer-to-peer lender’s other locations.

A fourth-quarter loan performance update from the London-listed platform revealed projected annualised returns for loans granted after fees and bad debts in Germany last year was 4.7 to 6.7 per cent.

This was down from estimates of five to seven per cent in quarter three of 2019.

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Projections for its UK business remained the same at five to seven per cent for loans approved in 2019, while investors are expected to earn 5.7 per cent to 7.8 per cent in the US and six to eight per cent in the Netherlands.

The highest gross yield among Funding Circle’s platforms is in the US at 13 per cent for loans in 2019, followed by 11.2 per cent in the Netherlands, 10.6 per cent in Germany and 9.9 per cent  in the UK., at 11.2 per cent for loans in 2019.

The level of projected bad debts remained broadly the same across each country Funding Circle operates in, at 2.1 per cent to four per cent of the loanbook in the UK, 4.8 per cent to 6.8 per cent in the US, 3.1 per cent to 4.9 per cent in Germany and 2.5 per cent to 4.3 per cent in the Netherlands.

Funding Circle’s share price opened up 4.3 per cent this morning (16 January) at 93.5p.

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