Credit risk

Rebuildingsociety “significantly” modifies credit risk processes

Rebuildingsociety has “significantly” changed its credit risk processes to account for the risks affecting businesses in the current climate.

The peer-to-peer lending platform said it was continuing to lend – and added a new public lending last month – but suggested it would take a more cautious approach to new lending going forward.

In October 2022, the platform financed a new public loan. This brings the total number of public loans made through Rebuildingsociety since its inception to 292.

To date, the total amount lent to small and medium-sized enterprises (SMEs) stands at £16,873,455.

Read more: Rebuildingsociety reopens in ARs

In a note to investors, the platform confirmed that it had two new defaults and no new public loan refactors last month.

“The total principal remaining on all loans is £2,135,615,” said Rebuildingsociety, in a blog post on the company’s website.

“Of this amount, 11.79% is currently in default.”

£750 was recovered by default in October, while the platform received £452,134 in principal repayments and £29,594 in interest payments.

“We are maintaining a rolling 12-month return figure to track last year’s earnings; this month’s performance brings the average to 1.87%,” Rebuildingsociety added.

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“We also track the net rate of return over the lifetime of the business; this figure remains fairly constant and currently stands at 5.88% net return per year.

The commercial lender added that it was trying to keep in touch with its borrowers to establish the impact of the current economic situation on their business.

Rebuildingsociety said that, where possible, it would offer borrowers assistance in the form of short repayment holidays or interest-only repayments.

Read more: Rebuildingsociety lenders post profits in September