European Lender Bondora Reports Strong Growth in Originations, Investment Funding

In April 2022, both originations and investment funding grew “strong” and set new highs for the year, according to an extensive update from Bondora.

The European lender noted that loan originations “increased by 7.2% to €15,697,955 and investments by 7.3% to €15,548,882.”

As mentioned in a blog post by Bondora, the total value of investments “trumped the previous 2022 record high.”

A total of €15,548,882 was “invested during April—a 7.3% increase.” Unsurprisingly, Go & Grow takes the majority “led with €14,471,390, Portfolio Manager follows with €600,990, then Portfolio Pro with €467,833, and lastly, the API with €8,669.”

Product funding figures:

  • Go & Grow + 7.5%
  • Portfolio Manager + 4.9%
  • Portfolio Pro + 3.6%
  • API + 0.1%

As noted in the update, all the investment products “had positive increases and Go & Grow had the highest growth rate with 7.5%.” And all the products, “except Portfolio Pro, which went from a 5.0% to a 3.6% growth rate, increased their growth rates from March.”

The API had “the most impressive growth, increasing from ‑8.7% to a positive growth rate of 0.1%.”

As mentioned in the blog post, the total shares of Bondora investment products “remained virtually unchanged.”

Only when looking at the decimal figures do we note “minor” changes:

  • Go & Grow “increased from 92.9% to 93.1%—equal to €14,471,390 in April. Portfolio Manager has a total of €600,990 invested—a 3.9% share (compared to 4.0% in March).”
  • In 3rd, they have Portfolio Pro, “an investment of €467,833—a 3.0% share (compared to 3.1% in March).”
  • And lastly, they have the API, which “still has a 0.1% share—equal to €8,669.”

Loan originations

Continuing March’s growth, loan originations “increased again in April. A total of €15,697,955 was originated—a 7.2% increase.”

The average interest rate “increased quite noticeably from 20.7% to 22.1%.”

Here’s a breakdown of all the origination stats:

Country breakdown

Once again, the most significant increase “came from Spain (+26.6%), with €627,897 being originated during April.”

Spanish loans “now have a 4.0% share.” The 2nd most significant increase “came from Estonia (+10.4%), with €5,668,453 originated, a 36.1% share.” Finnish loans “increased by 4.3% to €9,401,605.” The Finnish loans’ total share “receded to its February percentage of 59.9%.”

The average interest rate “increased noticeably from 20.7% to 22.1% (compared to +0.03% in March).” Once again, this can be “attributed to the fluctuating Estonian interest rate that increased from 22.5% to 25.% (+3.0%).”

Compared to the average Spanish interest rate (-0.4%) and the average Finnish interest rate (+0.6), this is “quite the change.”

Origination by country – April 2022

Slowly taking a bigger share of loans each month, Spain’s share of loans “increased from 3.4% to 4%.” At the moment, Bondora reports that it is “still only originating C-rated loans in Spain.”

This risk-rating category “is also the most popular in our other markets. In Finland, C-rated loans make up 53.1% of all loans.” And in Estonia, the same category’s share “is 12.1%.”

The D-rated loan category share “nearly doubled from 4.1% to 8.1% in Estonia.” In Finland, B- and D-rated loans ‘decreased by 1.3% and 0.2%, respectively.”

The average loan amount “increased in Spain (+3.5%) and Finland (+2.2%), but decreased slightly in Estonia (-1.5%).” This is now “the 7th month in a row that Estonian loan amounts have declined.”

Continuing the see-saw trend from the last few months, Spain “takes the lead from Finland with the highest average loan amount (€2,491).” Finland is “hot on its heels with €2,472. Estonia lags far behind with €2,120.”

For the first time in a while, all three markets’ average loan duration lengths “are different from each other.”

Finland remains unchanged “at 56-months, but Spain increased by two months and Estonia by one.”

Estonia now “has the most extended loan duration, with 58 months.”

As noted in the update, 60-month loans “remain the most popular across all our markets. This duration has the consistent majority in each country.”

In Estonia, 2,117 loans were “issued in this category; in Spain 195, and in Finland 2,876. 24-month loan durations are the 2nd most popular in Estonia.”

In Spain and Finland, 12-month loans are “the 2nd most popular, with 14 and 185 borrowers choosing this duration.”

As noted in the update:

“We see some variation in the average borrower age as each market’s age increased. Finnish borrowers remain the oldest by far, with 44 years. Estonian borrowers and Spanish borrowers’ average age increased to 39 years old.”

The update also mentioned:

“After increasing across all markets in March, Spain was the only market to have an increase in the average net income in April. They increased by 4.8% to €1,586. Finnish loans decreased by 5.9% to €2,786. It’s still the highest average by a landslide. The Estonian market had the most significant drop, declining 32.3%. This drop means Estonian borrowers have the lowest average monthly net income in April.”

For more details on this update, check here.

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