Zopa announces securitisation of loans

Zopa announces securitisation of loans

A securitisation of loans originated through Zopa has received the highest debut rating for any issuance backed by peer-to-peer loans.

The securitisation received an AA rating from Fitch and an Aa3 rating from Moody’s on its most senior notes.

Zopa’s securitisation was led by P2PGI, the UK’s first listed investment trust dedicated to investing in loans from peer-to-peer platforms, and was arranged by Deutsche Bank.

The transaction gained strong interest from a variety of investors, which Zopa felt paid testament to its track record in credit risk as well as confidence in its loans and underwriting.

“This is an exciting milestone in Zopa’s journey,” said Jaidev Janardana, CEO of Zopa.

“The securitisation process has involved detailed scrutiny of our underwriting and servicing practices from both ratings agencies and investors.”

Zopa has facilitated over £1.7bn in unsecured personal loans to the UK with each applicant being assessed using a multi-bureau approach.

Jaidev felt that the market’s reception to the securitisation validated the robustness of Zopa’s platform and lending policies.

“It brings Zopa personal loans further into the public spotlight and expands the universe of people who can participate in peer-to-peer lending.

“This supports our mission of providing a fairer financial future to even more customers.”

Simon Champ, CEO of MW Eaglewood Europe, the manager of P2PGI, concluded: “This transaction marks a positive step in enabling us to deliver on our objective to both diversify the sources and reduce the cost of our funding.

“The funds raised by the issue will now be progressively deployed in line with the investment strategy and our intention remains to steadily increase our leverage ratio to 100%.”

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