RateSetter reached profitability last year
RateSetter reached profitability in 2021, during its first full year as a Metro Bank brand.
The former peer-to-peer lending platform earned a profit before tax of £4.1m during the 12 months to 31 December 2021, which represents the first time RateSetter has entered the black.
During the previous year, the company made a loss of £22.1m.
According to the latest strategic report from the consumer lender, this year-on-year movement was driven by dividends received from subsidiaries of £12.5m.
Read more: RateSetter’s losses deepen in final year as P2P lender
RateSetter’s income decreased slightly to £10.3m last year, versus £11.6m in 2020. This income is received from a combination of loan origination fees, loan management fees, and release fees.
RateSetter said that the majority of the 2021 income came from origination fees paid by Metro Bank. These fees are equal to 1.1 per cent of the total loan amount.
Elsewhere in the financial statement, it was confirmed that Retail Money Market – the listed name of RateSetter – will be wound up within the next 12 months.
Metro Bank completed its acquisition of RateSetter in September 2020. In February 2021, the bank acquired the remaining loans that were being held on the RateSetter platform, and all retail investors were reimbursed soon after.
Read more: RateSetter helps Metro Bank’s consumer lending business grow by 256pc
In June 2021, Metro Bank bought RateSetter’s car dealing business. Then in October 2021, RateSetter sold the brand and intellectual property associated with the consumer lending platform to Metro Bank. Following this sale, the trading activities of the former P2P lending platform ceased.
Read more: Metro Bank narrows losses as RateSetter loans breach £1bn