Proplend edges towards profitability after narrowing losses
Proplend chief Brian Bartaby has said he is “cautiously optimistic” for the platform next year after narrowly missing out on becoming profitable in 2020.
Bartaby (pictured) said that the peer-to-peer lending platform – which focuses on commercial property – has made 100 per cent lender interest payments in full this year and improved its balance sheet, despite the ongoing Covid-19 crisis.
Bartaby’s comments come as Proplend’s latest annual results showed that the platform’s losses narrowed to £238,800 in 2019 from £585,242 in 2018.
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“I am cautiously optimistic for Proplend in 2021, we are competing against fewer bank lenders and potentially moving into a negative interest rate environment,” he said.
“We will continue to lend where we see value for our loyal lender base, at the end of the day it’s their money not ours and we are always conscious of that. We are looking to launch some new products early 2021, so watch this space.
“Surprisingly, whilst we have physically lent less, the bottom line has continued to improve. We were on target to profitability this year and only just missed it.
“Whilst we continued to lend the whole way through 2020, our concentration turned to maintaining the existing loanbook.
“As a result, 100 per cent of lender interest payments were made in full in 2020. This was combined with careful cost management. We are a small but highly efficient team; we manage similar loan volumes with about a third of the staff numbers to our closest competitor.
“Plus, we have used this time to evaluate all our processes and workflows to see how we can become more efficient and improve our service and offerings to both our borrowers and lenders.”
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Bartaby forecasted that commercial property will endure the crisis and hopes the vaccine will be rolled out across the majority of the population in the first quarter to return to a more normal environment.
“Everyone agrees that there will be a new normal, we just don’t know what it will look like yet,” Bartaby said.
“The media has done a great job of writing off commercial property, but commercial property has endured previous evolutions, and it will again.
“Remember, everything that is not residential, is commercial, it covers a wide range of asset types. Some of which have struggled in 2020 and will do beyond and some which have outperformed.
“I have concerns for lenders which have participated in coronavirus business interruption loan scheme lending given that expected default rates are running to 40 per cent.
“If this does happen, there will be a huge amount of loan work out to be done, which is not an easy or pleasant job.”