The portfolio has seen a strategy shift in the past 14 months or so away from loans originated by marketplace lenders to ‘balance sheet’ lending platforms.
The £336.8m VPC Specialty Lending fund has sold its total holding in Prosper marketplace loans, representing 4.1 per cent of the Company's net asset value [NAV].
Since August 2016 the portfolio has been making strategic shift away from its core P2P/marketplace loans exposure toward online balance sheet lending platforms.
This has included exiting loans originated by Avantand Funding Circle US in the past year and a partially recovery in its dividend following a previous cut.
“In line with the previously stated strategy of reallocating capital from marketplace lending to balance sheet lending, the Company is pleased to announce that it has sold its Prosper marketplace loans,” the fund said in stock market update.
The loans sold represented approximately 4.1 per cent of the Company's NAV as at 31 October 2017, reducing the fund's marketplace loan exposure to 3.3 per cent and the look-through gearing ratio to 0.22x.
The impact of the sale on the fund’s NAV is estimated by its investment managers to be approximately -0.56 per cent, will be reflected in the December NAV announcement soon.
Following the sale the fund was able to immediately reinvest “substantially all” the Prosper sale proceeds into two new balance sheet investments, as well as other existing balance sheet investments.
After this reallocation, the Company expects the balance sheet investment exposure to increase to approximately 79 per cent of the fund.
