As the EstateGuru team claims to have predicted, the total funded amount in March was “similar to February.”
EstateGuru‘s management writes in a blog post that investors “financed €16.7M worth of loans and, despite macroeconomic changes, investor and borrower behavior remains stable.” During March, Estonia and Germany again “performed well, each contributing 30% of the total loan volume.”
As mentioned in a blog post, loan repayments “amounted to half of those in February (€5.4M, 19 loans).” The update from EstateGuru further noted that “the degree of volatility is reflective of seasonality and not payment problems, and [they] expect repayments to improve in the second quarter.”
As noted in the update, the default rate “decreased to 5.0% and is now in line with the long-term target rate [they] set internally.”
This was primarily “due to strong debt management in Estonia, where one project’s full principal amount was recovered (€0.9M).” The blog post from EstateGuru further revealed that the rest (interest, penalties etc) will be received by their investors “following the successful conclusion of ongoing legal disputes.”
As stated in the report (as of April 14, 2022):
- Total financed loans since 2014 – 550.8 Million Euros
- Total Repaid loans since 2014 – 304.9 Million Euros
- Total outstanding portfolio – 245.8 Million Euros
- Total outstanding defaulted loans – 12.4 Million Euros
They also confirmed:
- Total number of outstanding defaulted loans – 48
- Default Rate (Outstanding loans) – 5.0%
- Partially recovered loans rate (outstanding loans) – 1.6%
- Default Rate (total Financed loans) – 2.3%
- Total amount of Recovered loans – 17.0 Million Euros
- Total number of Recovered loans – 98
- Average return rate of recovered loans – 9.5%
- Average time from default to recovery – 8.9 months
- Write-off rate (total financed loans) – 0.007%
As covered in March 2022, EstateGuru, an online investment platform matching SMEs in need of capital with individual investors, will launch a fund targeting institutional investors in a move that should significantly scale the firm’s operations.
Importantly, the European Investment Fund (EIF) has committed to be an anchor investor in the fund using resources from the European Guarantee Fund created to ensure that European SMEs have sufficient financing available to mitigate the economic impact of the COVID-19 crisis.
The EstateGuru Senior Secured Credit Fund will provide funding for European SMEs via the online lending platform. The Fund is said to mainly focus on SMEs in Estonia, Latvia, Lithuania, Finland, and Germany. The fund is a closed-ended (7+1 year) private debt fund available for qualified investors. The first close is expected to take place at the end of Q2 in 2022.
