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  1. #271
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    Swung back today > Borrowers this afternoon now waiting for Investors Funds!!


    Capture.jpg
    Last edited by Saamee; 30-03-2017 at 02:55 PM.

  2. #272
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    Quote Originally Posted by Saamee View Post
    Swung back today > Borrowers this afternoon now waiting for Investors Funds!!
    great news, in that case I'd better deposit some more money

  3. #273
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    Just noticed the Reserve Fund has fallen under 3% now at 2.92% - 1st time i have sighted it below that level.

    Although their Loan book is now over $7.1M they must have Written off quite a few Loans at the end of the Month \ Financial Year....

    SM.jpg

  4. #274
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    I don't fully understand how it operates. It has been operating for more than a year now, so I don't think Squirrel is obliged to keep the reserve fund at 4%. Perhaps it is naturally decreasing to a lower % without write-offs?

  5. #275
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    Quote Originally Posted by Bjauck View Post
    I don't fully understand how it operates. It has been operating for more than a year now, so I don't think Squirrel is obliged to keep the reserve fund at 4%. Perhaps it is naturally decreasing to a lower % without write-offs?
    Yes your right now it is floating and will move downwards more. It did take a large drop over the Weekend.

  6. #276
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    I think that it's been hovering around the 208-209k mark for a few months.
    On their website it says: "What happens if the Reserve Fund runs out?

    Our expected loss rate on the existing loan book is 1.3%, however we are currently reserving at 1.9% which provides 1.5x coverage over the expected loss rate each year."
    Last edited by icyfire; 03-04-2017 at 10:21 PM.

  7. #277
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    Quote Originally Posted by Bjauck View Post
    I don't fully understand how it operates. It has been operating for more than a year now, so I don't think Squirrel is obliged to keep the reserve fund at 4%. Perhaps it is naturally decreasing to a lower % without write-offs?
    Squirrel decides what percentage of loan income is allocated into the fund, currently 1.9%. Correct, they have no obligation in terms of the fund's balance. They chose to start it off with $200k of their own funds and now periodically decide what % of loan income to allocate to it based on predicted losses.
    Last edited by Investor; 04-04-2017 at 06:27 AM. Reason: 1.9%

  8. #278
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    Does the current reserve fund of $208k still include the $200k from Squirrel? If it does, wouldn't this indicate that the expected loss rate is actually closer to 2% (not 1.17%) if the reserve levy is currently 1.94%?

  9. #279
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    Quote Originally Posted by baldricknz View Post
    Does the current reserve fund of $208k still include the $200k from Squirrel? If it does, wouldn't this indicate that the expected loss rate is actually closer to 2% (not 1.17%) if the reserve levy is currently 1.94%?
    The site suggests a 2016 bad debt rate of 0.6% (0% for 2017, I think it's the bad debt on loans issued in that year). If I understand it correctly, the loan book will grow quicker than the reserve fund (when a loan is made it immediately adds to the book but only dribbles into the reserve fund as payments are made), so it's not surprising to see the coverage ratio dropping as the loan book grows, now that Squirrel don't have to keep it topped up.

    https://www.squirrelmoney.co.nz/platform-statistics/

  10. #280
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    Quote Originally Posted by baldricknz View Post
    Does the current reserve fund of $208k still include the $200k from Squirrel? If it does, wouldn't this indicate that the expected loss rate is actually closer to 2% (not 1.17%) if the reserve levy is currently 1.94%?
    Yes it does. As the loan book grows the Reserve Fund Levy will decrease accordingly. Plus it will get depleted quicker as and when Loans are Written Off.

    I get uncomfortable seeing the Reserve Fund getting lower and lower - felt happier when it was sitting @ 4% over the 1st year of their trading...

  11. #281
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    Anyone else viewing a portion of their SM investment like Term Deposit?

    With the SM Secondary market you now have choices....

    1) $$'s in a main street bank on a TD @ maybe 2.05% / Year for a month

    or

    2) $$'s in SM @ 9% / Year per month.... with a $50 break fee if required??


    Just thinking.....
    Last edited by Saamee; 07-04-2017 at 07:01 PM.

  12. #282
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    I don't think of them as substitutes but SM is the only cash hold that I am increasing.

  13. #283
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    That's exactly what I've been doing. As my bank term deposits have matured I then invested the money in SM. The ROI is much better than what the banks are currently offering.

  14. #284
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    Yep have been doing the same regarding term deposits and SM. Into 6 figures now, not sure how wise it is though considering such a large % of loans are unsecured. My preference is for LC but the number of loans coming through is low.

  15. #285
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    I invest in both LC and SM. LC has loans secured against a vehicle and sometimes property while SM has the Loan Shield. Hopefully all borrowers on LC using their vehicle as security have insurance on that vehicle. I'm hoping also that LC take into account the fast depreciating value of a vehicle when calculating a borrower's risk grade.

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