By Daniel Lanyon on 15th December 2017
More pain for the Ranger portfolio as it nears the 1 year anniversary of its first platform failure.
The £232m Ranger Direct Lending fund has made a further $9.1m provision against its indirect investment in the collapsed Argon Credit lending platform.
In the past 12 months or so the Ranger portfolio has suffered from uncertainty on its largest holding's, the Princeton Alternative Credit fund, exposure to Argon Credit, a consumer direct lending platform that filed for bankruptcy in December 2016.
Since then there have already been a number of write-downs and this latest expected hit will result in a further decrease of 3.8 per cent in the net asset value which has already seen a $10.4m provision made in late November.
The latest update from Princeton has meant Ranger now estimates, say analysts Numis, that its exposure to the imposed Argon side pocket capital account is now $3.8m, while the current indirect loan exposure (net of anticipated expenses) to Argon is $2.4m.
Ranger said in statement: “Having reviewed the information provided prior and pursuant to the arbitration proceedings thus far, the Company has determined in accordance with its valuation policy to unilaterally take an additional gross reserve of US $9.1 million against its indirect investment in the Argon portfolio.”
The fund also recently cut its dividend owing to heightened costs in relation to the arbitration with Princeton as well as lower expected returns from a portion of the SME loans/business cash advances and consumer loans portfolios.