Bondora portfolio performance – November 2016

KEY TAKEAWAYS

  • Our realized net returns for Q2 exceeded four of the five previous quarters.
  • Spain and Finland each also had Q2 realized net returns which exceeded four of the five previous quarters.
  • Estonia and Finland outperformed their targets by 519 basis points and 376 basis points respectively.
  • Spain fell below the targeted goal while Finland earned a greater realized net return than any quarter in 2015 or 2016 to date.
  • The “F” rated loans delivered the highest realized net return for Estonia, Spain and Finland in Q2.

ACTUAL AND TARGETED BONDORA NET RETURNS BY GRADE AND COUNTRY

ESTONIA:

  • While the “E” and “F” rated loans generated higher realized net returns than they did in Q1 the other ratings all fell below the previous quarter returns.
  • Estonia continues to be the only country where “AA” and “A” rated loans are available.
  • The “AA” rated loans outperformed their target by 79 basis points.
  • Across all ratings the median return was 18.33% and the average was very similar at 18.79%
Estonia AA A B C D E F HR
2015
Q1
Actual 14,91% 14,48% 16,65% 19,72% 22,81% 26,62% 28,80% 25,28%
Target 12,98% 13,82% 14,30% 15,74% 18,51% 20,34% 23,14% 23,46%
2015
Q2
Actual 14,68% 10,78% 16,04% 17,78% 24,53% 21,03% 34,84% 24,15%
Target 13,11% 13,83% 14,26% 15,96% 18,47% 20,49% 23,06% 23,62%
2015
Q3
Actual 15,32% 15,61% 16,71% 21,85% 21,85% 28,96% 33,20% 33,08%
Target 13,09% 13,84% 14,27% 15,85% 18,39% 20,32% 23,15% 23,85%
2015
Q4
Actual 13,95% 15,60% 15,78% 20,34% 23,73% 22,26% 29,16% 36,43%
Target 12,20% 13,17% 13,81% 15,50% 17,59% 18,41% 21,29% 20,83%
2016
Q1
Actual 11,63% 12,75% 15,19% 19,73% 24,40% 28,07% 29,95% 36,78%
Target 10,62% 11,32% 12,09% 14,38% 16,18% 17,51% 18,28% 17,96%
2016
Q2
Actual 8,94% 3,06% 13,21% 15,52% 21,13% 25,10% 32,08% 31,28%
Target 8,15% 9,74% 11,46% 13,62% 15,22% 16,47% 17,05% 17,10%

FINLAND:

  • Every rating except “HR” outperformed the targeted realized net return.
  • The “B” and “C” level ratings offered better realized net returns than those same ratings in Finland for the previous five quarters.
  • “B” and “C” ratings outperformed the same ratings in Estonia.
  • The median return across all ratings for Finland was 18.38%
Finland AA A B C D E F HR
2015
Q1
Actual 10,69% 9,15% 11,21% 15,59% 23,04% 44,95%
Target 12,88% 13,33% 14,41% 16,58% 17,98% 20,90%
2015
Q2
Actual 6,44% 12,58% 14,32% 12,54% 9,18% 16,12%
Target 12,88% 13,31% 14,70% 16,62% 18,04% 21,04%
2015
Q3
Actual 10,05% 11,61% 15,77% 17,12% 9,48% 22,61%
Target 12,90% 13,28% 14,71% 16,49% 18,54% 20,81%
2015
Q4
Actual 1,75% 11,04% 19,38% 16,26% 11,94% 26,00%
Target 12,89% 12,80% 14,49% 16,02% 16,86% 18,11%
2016
Q1
Actual 14,60% 14,84% 20,42% 26,08% 25,17% 18,47%
Target 9,87% 11,22% 12,56% 13,44% 14,24% 14,40%
2016
Q2
Actual 15,42% 18,91% 17,84% 23,94% 24,04% 12,51%
Target 12,07% 14,05% 16,17% 17,55% 18,27% 19,19%

SPAIN:

  • The “E” rating experienced a significant drop in performance compared to Q1 2016.
  • The median performance in Spain for Q1 2016 (13.15%) was higher than the total realized net return for the country in 2015 (10.80%).
  • The “F” rating outperformed the same rating in each quarter of 2015 for Spain.
  • At the moment the eventual total realized net return for Spain appears to be on track to outperform 2013 through 2015. We’ll watch to see how this develops.
Spain AA A B C D E F HR
2015
Q1
Actual -1,10% -6,81% -5,39% 8,77% 17,17% 14,17%
Target 12,61% 12,85% 14,39% 16,17% 18,32% 20,33%
2015
Q2
Actual -10,81% -7,60% 8,43% 15,76% 17,43%
Target 12,80% 12,80% 14,36% 16,29% 18,32% 20,31%
2015
Q3
Actual 17,42% -8,26% 11,02% 16,71% 8,96%
Target 13,01% 14,74% 16,20% 18,32% 20,31%
2015
Q4
Actual 18,14% -2,31% 9,98% 20,80% 16,66%
Target 13,41% 14,93% 16,22% 17,85% 18,06%
2016
Q1
Actual 34,72% 30,94% 25,56%
Target 14,61% 14,58% 13,93%
2016
Q2
Actual 9,18% 24,91% 13,15%
Target 19,41% 20,16% 20,36%

ACTUAL AND TARGETED BONDORA NET RETURNS ACROSS PORTFOLIO PER QUARTER

Since Q4 of 2015 the actual realized net return has exceeded the targeted figure.

2015-Q1 2015-Q2 2015-Q3 2015-Q4 2016-Q1 2016-Q2
Actual 15,71% 15,04% 16,58% 18,50% 23,18% 19,17%
Target 16,34% 16,33% 16,63% 16,28% 14,66% 15,64%

ACTUAL AND TARGETED BONDORA NET RETURNS ACROSS PREVIOUS 7 YEARS

Spain and Finland each have a three-year trend of progressively outperforming the previous year. While Estonia saw a drop in performance from 2014 to 2015 the country has still delivered the highest realized net return of any other country for the past three years.

2009 2010 2011 2012 2013 2014 2015
Country Actual Actual Actual Actual Actual Actual Actual Target
EE 16,40% 29,34% 24,12% 23,04% 22,01% 22,14% 20,74% 16,88%
ES -5,86% -1,33% 10,80% 17,50%
FI 11,65% 11,41% 13,79% 15,30%
SK -6,12%
ALL 16,40% 29,34% 24,12% 23,04% 19,68% 13,19% 16,17% 16,40%

DISCLAIMER

Please note that past performance does not guarantee future results as economic environment, competition, performance of risk models, loan pricing and recovery processes can improve or deteriorate over time.

We do not recommend to set unrealistic expectations although 84.2% of investors on Bondora peer-to-peer lending marketplace have earned more than 10% annually (investors who have invested more than 1,000 euro over a period of 12+ months). Investing on Bondora is not suitable in case you expect to invest less than 1,000 euro as proper risk diversification shall not be achieved and returns can be highly volatile.

PS! In case you are looking for technical details on the net return calculation then please read an earlier article on the subject here.

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