Lending Works reports stable returns and loss rates in Q1 update
Former peer-to-peer lending platform Lending Works has released a first-quarter update which showed expected annual returns and loss rates remained broadly stable compared to the previous quarter.
Expected annual losses were updated based on the latest quarter and the latest economic forecast, which an independent third party provides.
The firm, now rebranded as embedded finance platform Fluro, said overall expected annual losses on the active portfolio remained relatively steady at 3.7 per cent, and the loss rate ranges narrow as each cohort reaches maturity.
The company said it will continue to monitor this closely due to the external economic environment and factors, such as the cost-of-living crisis, that may have had an impact on active loan customers.
They will also continue to enhance processes and procedures to support borrower customers who may face changes in their financial circumstances, and will continue to pay at the target interest rate level for all cohorts.
Expected annual returns have also remained relatively stable and broadly aligned with the previous portfolio performance.
The average returns on past cohorts (2014-2019) are 4.4 per cent per annum for investments into its ‘Growth’ account and 3.8 per cent per annum for ‘Flexible’; this continues to be maintained from the previous update.
The 2020 and 2021 cohorts’ average returns are 2.5 per cent per annum and 4.5 per cent for Growth, and 1.8 per cent and four per cent for Flexible, respectively, maintained from the previous update.
Finally, the company will continue to pay at the target interest rate level for all cohorts.
The next update will be in July 2023.
Read more: Lending Works’ history in P2P