4Finance, the online and mobile consumer lending group, has announced its unaudited consolidated financial results for 2016. The firm saw revenues climb by 24 per cent in the 12 months ending 31 December 2016, equating to €393.2m, compared with €318.3m in the previous year. Its net profits rose to €63.2m, up from €58.2m in 2015.
The company’s net loan portfolio stood at €493.9m as of 31 December 2016. Its gaudy profit figures – in relation to the size of its outstanding loan book – are due chiefly to the high interest rates that it charges to consumers. The average annualized interest rate on its online loans in 2016 was 120 per cent.
Loans made via its banking operations carried an average interest rate of 27 per cent. 4Finance acquired Bulgarian Bank TBI for €69m in August of 2016.
The company's average net loan portfolio for its banking services was €173.5m in 2016, versus €312.4m for its online loans.
4Finance writes loans off its own balance sheet, and regularly taps up the bond markets for funding, raising €150m via bond listings in 2016. The company places strong emphasis on technology, both in terms of the way that it fields and underwrites loan requests. It crossed the €4bn mark in cumulative lending in early February this year.
George Georgakopoulos (pictured above), CEO of 4Finance, said that he welcomes the introduction of new regulation in a number of markets in 2017/18. “We continue to make the positive case for access to online credit for consumers and the value of our products,” he said. “Regulators increasingly recognise the value of meeting the demand of under-served borrowers within a regulated sector and we believe we are well positioned to meet this need.”