Fintech lender 4finance grows revenues, originations in half year results

Online lender reports generally positive results, but sees profits fall.

4finance, a high interest rate online and mobile lender, has reported its results for the first half of 2017. The company’s revenues climbed 17 per cent to €213.6m, versus €182.8 in the same period last year. But while originations and other key metrics showed improvement, the company’s profit before tax was down 9 per cent to €35.3m, versus €38.6 in the first half of 2016.

Online loan issuance for the platform grew 13 per cent during the period to €609.1m, while the platform’s net loan portfolio grew to €519.8m, up 8 per cent year-to-date.

4finance also exhibited signs of improved credit management, posting a non-performing loans to online loan issuance ratio of 8.5 per cent as of 30 June 2017, compared to 9.3 per cent at year end 2016.

The group’s profits have taken a hit in part because its new Euro-denominated bonds, which were issued in May and November 2016, and its US bond issuance and refinancing in April have served to increased interest expense. The company’s administrative costs have also increased, in part due to acquisitions made in 2016, but also due to its investments in the growth of the company.

Its registered online lending customers reached 6.9m in number at the midway point of the year, up 30 per cent from a year ago. The company also has a further 1.4m banking customers to its name, added through its €69m acquisition of Bulgarian bank TBI Bank in August of 2016.

4finance is currently active in 17 countries. The firm says that its Latin American growth continues apace, with issued loan volumes and revenue tripling in H1 2017, compared to the prior year period.

Mark Ruddock (pictured) took over from George Georgakopoulos as CEO of the firm during the first half of this year.

"I am excited at the opportunity ahead for 4finance,” said Ruddock. “Today, some 2.6 billion consumers globally remain underserved by traditional financial products; breakthroughs in data science and analytics are enabling new methods of scoring those with limited credit histories; we are seeing unprecedented access to the internet via increasingly ubiquitous and inexpensive mobile devices; and the millennial generation are breaking old conventions about the nature of financial products and how they are consumed.”