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04-05-2018, 10:31 PM
#3211
Member
Originally Posted by joker
Looks like an admission by Harmoney that interest rate reductions called scorecard 1.5 were too low (as evidenced by a severe drop in the RAR graph since).
10% wouldn't provide institutional investors with adequate return relative to the risk.
Capture.JPG
Since HM success is through ticket clips, I'd say the institutions are behind this (us as lendors are simply a marketing angle). HM "investing" would better align their interests with institutional investors
Either way, am happy to have an extra 2-3%
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04-05-2018, 11:19 PM
#3212
yeah, nah
Just for comparative and historic record:
InterestRates.png
Those high end B Grade loans are looking good again. I do wonder if the grading process Harmoney uses will change i.e. will a new B5 borrower be the same as an old B5 borrower, or is this a way to 'shift' investors who continue to select the same grade/rate loans???
Attachment 9658
As a chart - smoothed as it looks better... Interesting that the lower-mid grade loans now have a higher interest rate then they did pre August 2017.
I'll include default rates if a new set is published...
Last edited by myles; 04-05-2018 at 11:57 PM.
Reason: chart
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05-05-2018, 09:06 AM
#3213
Member
Originally Posted by myles
I do wonder if the grading process Harmoney uses will change i.e. will a new B5 borrower be the same as an old B5 borrower, or is this a way to 'shift' investors who continue to select the same grade/rate loans???
Would be good if the grade related to an explicit expected default rate band but I think the expected default moved with 1.5 and as you say we don't have new forecasts for the current re-pricing.
Last edited by RMJH; 05-05-2018 at 09:26 AM.
Reason: typo
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05-05-2018, 09:21 AM
#3214
Member
Grade |
Forecast default rate p.a. |
Scorecard 1.0 |
Scorecard 1.5 |
A1 |
0.08% |
0.05% |
A2 |
0.13% |
0.10% |
A3 |
0.16% |
0.11% |
A4 |
0.21% |
0.12% |
A5 |
0.27% |
0.14% |
Grade |
Forecast default rate p.a. |
Scorecard 1.0 |
Scorecard 1.5 |
B1 |
0.32% |
0.16% |
B2 |
0.42% |
0.18% |
B3 |
0.54% |
0.21% |
B4 |
0.63% |
0.25% |
B5 |
0.74% |
0.30% |
Grade |
Forecast default rate p.a. |
Scorecard 1.0 |
Scorecard 1.5 |
C1 |
0.86% |
0.37% |
C2 |
1.04% |
0.46% |
C3 |
1.19% |
0.56% |
C4 |
1.39% |
0.70% |
C5 |
1.51% |
0.89% |
Grade |
Forecast default rate p.a. |
Scorecard 1.0 |
Scorecard 1.5 |
D1 |
1.53% |
1.13% |
D2 |
1.79% |
1.42% |
D3 |
1.95% |
1.78% |
D4 |
2.21% |
2.18% |
D5 |
2.50% |
2.60% |
Grade |
Forecast default rate p.a. |
Scorecard 1.0 |
Scorecard 1.5 |
E1 |
2.78% |
3.14% |
E2 |
3.52% |
3.70% |
E3 |
4.11% |
4.38% |
E4 |
4.95% |
5.12% |
E5 |
6.05% |
5.84% |
Grade |
Forecast default rate p.a. |
Scorecard 1.0 |
Scorecard 1.5 |
F1 |
6.96% |
6.62% |
F2 |
8.36% |
7.34% |
F3 |
9.79% |
8.09% |
F4 |
12.63% |
8.78% |
F5 |
15.38% |
9.49% |
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05-05-2018, 09:25 AM
#3215
Member
Sorry headings are not aligned.
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06-05-2018, 10:41 AM
#3216
Here You Go
Originally Posted by RMJH
Sorry headings are not aligned.
Will be interesting to see how the default rates may have changed, if at all. I think the interest rate changes (at least for the less risky grades) finally reflect the risk more accurately now.
By the way, all such changes (better or worse) render historical comparisons less useful.
Last edited by beacon; 08-05-2018 at 08:52 AM.
Reason: Image removed on myles request
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07-05-2018, 10:37 AM
#3217
Originally Posted by Investor
Grades with a changed default rate:
C4
D1-D5
E1-E5
F2,F4,F5
These may not be the latest release. Harmoney has had these differing default rates on 2 separate pages online for months now.
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07-05-2018, 10:47 AM
#3218
Investor
Originally Posted by beacon
These may not be the latest release. Harmoney has had these differing default rates on 2 separate pages online for months now.
I had the original scorecard 1.5 default rates saved on excel and compared them to the current ones on their website. Not sure when it was updated since 1.5 (if not in the last few days).
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07-05-2018, 10:55 AM
#3219
Both probably last updated around 14 aug 17
Originally Posted by Investor
I had the original scorecard 1.5 default rates saved on excel and compared them to the current ones on their website. Not sure when it was updated since 1.5 (if not in the last few days).
Use the rates here: harmoney.co.nz/investors/investment-risks
as they seem to match the info in loans more, although I haven't checked this in the last 5 months
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07-05-2018, 11:04 AM
#3220
The other page was here: https://www.harmoney.co.nz/how-it-works/scorecard-1-5
Default rates on these two pages match now, so they must have corrected the differing page in Dec/Jan
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