Vpc Specialty Lending In... Share Discussion Threads

[redhill9] 23/10/2020 13:24

Metage Funds Limited, registered in the Cayman Islands, has just announced going over 3% hTTps://www.voxmarkets.co.uk/rns/announcement/9c1ea157-2e96-4ab8-8c0d-6932e34c14cf/

[redhill9] 23/10/2020 10:44

...and another announcement giving some background to the Board changes, and the result of shareholder discussion. hTTps://www.voxmarkets.co.uk/rns/announcement/57431440-1f48-4184-afba-fa8be2db0fb8/

[redhill9] 23/10/2020 08:42

Board personnel to be "refreshed and strengthened" RNS 23 October 2020 VPC Specialty Lending Investments PLC (the "Company") Refreshing and strengthening the independence of the Board The Board has now undertaken a review of the skills mix, size, and diversity required of the Directors for the next phase of the Company's development and growth. The Board will be recruiting two new Independent Directors, one of whom will have financial acumen and be well seasoned in the investment trust market, and for whom the search is already in progress. Given that the Chairman is currently the sole qualified accountant on the Board, the Board also wishes to recruit a qualified accountant, ideally with investment trust experience, to be the Chair for the Audit and Valuations Committee ("AVC Chair"). This search will commence once the previous one concludes. Clive Peggram, the existing AVC Chair, will continue to be a Director. The Board is using an independent search consultancy to source candidates and expects to be able to announce the first appointment within 4 weeks and the AVC Chair early in the new year. As previously announced on 23 June 2020, Richard Levy will retire from the Board once the search for his replacement has been concluded. Mr. Kevin Ingram, the Chairman, will oversee the refreshing of the Board's composition and succession process. He intends to retire from the Board at or before the AGM in June 2021. Mr. Kevin Ingram has served on the Board since the IPO in 2015 and made a considerable contribution both as AVC Chair and subsequently as Chairman. Recently he has seen the Board and VSL through a period of significant challenges, including market turmoil and the continuation vote. The Board is fortunate that Mr. Kevin Ingram is staying in post until a successor has been appointed and there is an appropriate handover period. The Board is very grateful for all that he has done and continues to do for the Company. The search for a new Chairman will start in early 2021 and the Board will keep shareholders informed of its progress.

[waterloo01] 19/10/2020 07:48

Still can't buy via Barclays. Absolute shower.

[chucko1] 15/10/2020 14:26

In theory, the NAV should start to drift higher as loans repay. Especially with the short average life. This may in part explain the quick release of some credit-loss provisions last month (and rather more quickly than I had thought would be the case).

[chucko1] 15/10/2020 11:54

Barclays seem to assume that if the KID is not on your web site, then you cannot have read it! The irony is that most KIDs are total nonsense. You would actually be better off not reading them (tell the Woodford investors that - the income funds were described as medium risk!). But that's yesterday's news only cretins are unable to learn from. On the Stifel report - much what I have argued the past few weeks. They could have gone into the maths of the numbers more, as this is pretty telling for a very low duration bond fund (which is really what we are dealing with here). FWIW, I have pretty well doubled my exposure the past few weeks. Cannot really add too much more as it now accounts for 20% of my dividends! Risk rules OK.

[escapetohome] 15/10/2020 11:30

Try EQI, none of that trouble with the KDI, just a tick box exercise to confirm that you read the KDI. Simple to do, no hassles.

[redhill9] 15/10/2020 11:13

Thanks davebowler for posting that Stifel report. Difficult to disagree with anything they say; seems to me a very fair assessment, and a positive one. I keep finding it hard to resist buying more shares despite my portfolio already being overweight in VPC, but Stifel may just have persuaded me.

[waterloo01] 15/10/2020 08:53

Well I keep adding. 13% divi and decent discount to NAV. Hard to beat. (Spoken with Barclays and sent them the KID. Nuts it was up to me to do it) Barclays called back and even though I've shown the KID they need it to be updated by the company. I despair.

[davebowler] 15/10/2020 08:23

Stifel; It is now over six months since the virus was unleashed, and while the fund has weathered the challenging period well, the discount remains at a historically wide level of 28% and still offers a covered dividend yield of 13%. The underlying loans have a short duration of c.1 year and so the portfolio has also been significantly de-risked with c.50% of the pre-March portfolio rolled-over. With many income funds suffering from dividend cuts, the pricing of VPC looks an anomaly. Although concerns regarding a fragile US consumer are valid, we think the portfolio should now be in a better position as new originations have tighter underwriting standards and are also to higher quality borrowers. We upgrade to Positive. Key Points Concerns over US consumer. We downgraded VPC in April to Neutral on the back of concerns for the US consumer. Since then the manager and underlying borrowers have limited new originations which essentially means the portfolio has been de-risking. The average duration of loans made to consumers is approximately one year, which means that c.50% of the March portfolio has now been amortised, which is a significant reduction in risk. As with all lending funds, new originations will take into consideration the higher risk environment today by tightening lending standards. Hence, we view portfolio churn as positive as the investment process does not stand still. Historically, loans made today should be the most profitable as the interest rate charged can be increased while borrower quality should also improve. Provisions released. In August, the manager noted that provisions had begun to be released as the portfolio has weathered this period well. We think there is scope for this to continue as the underlying portfolio continues to amortise and so should benefit from a pull to par effect. As at 30/06/20 the IFRS 9 reserve was £15.6m with 37% designated as stage 1 and 60% stage 2. In total this represents 6% of NAV. Increasing international exposure. The fund has also increased its international footprint with a new investment in Laybuy which provides consumers with a buy now pay later option in UK, Australia and New Zealand. We have our reservations around expanding the portfolio's international reach but also recognise that some diversification away from the US consumer can also be positive. How this segment performs will be an area to watch going forward. The manager has also broadened the funds profile by investing in the sponsor economics of its own SPAC which raised $200m (ticker: VIH). Sponsor economics in a SPAC can be quite accretive as it receives an outsized share of the vehicle for sponsoring it during its pre-IPO stage. The SPAC is targeting a high growth fintech company with an enterprise value of between $800m - $2bn. Unlisted equity. The manager is also increasingly confident in the prospects of some of its unlisted equity positions, which took markdowns in Q1 but have not yet reflected the rebound seen in equity markets. As online purchasing and 'buy now pay later' has grown through the pandemic, there is the potential for markdowns to be reversed and even marked up. There are 26 unlisted portfolio company investments that represent 10% of NAV, so exposure is diversified. Unlisted equity investments are valued based on the last funding round or comparable public company multiples. Key positives. The demise of Pollen Street Secured Lending through an eventual run-off or sale of the company may well provide a technical tailwind to the fund as investors have limited options for a high yielding lending fund. This along with continued large share buybacks, a large discount to NAV (with a long term plan to narrow the discount) and high dividend yield should support the share price. Key negatives. The manager has done a good job in protecting the portfolio from the economic problems caused by COVID-19 and has also benefited from the large stimulus measures introduced by the US government. However, there is no hiding from the risk of further restrictions due to a surge in infections and the knock on impact to the economy. In theory, the portfolio should be better protected given the portfolio churn that has taken place. Negative sentiment surrounding the lending sector also persists as some bad apples have tainted the sector but we think this is unfair.

[chucko1] 14/10/2020 13:44

Same big volume on Monday with a trade of 2mn. But it's just noise in the big scheme of things with this stock.

[redhill9] 14/10/2020 13:15

At yesterday's close the yield was over 12.5% which seems just much too high so I'm not surprised if someone is buying (unless it's more buybacks?).

[waterloo01] 14/10/2020 11:52

2m buys in 3 trades.

[chucko1] 12/10/2020 17:50

Yup - I spent 2 years moving 9 accounts. Had a Junior ISA for my daughter who turned 18 when they changed from BS to BSI. It would have been easier to have pulled my teeth out.

[waterloo01] 12/10/2020 14:09

I also moved all but the one ISA account. Quite useless generally.

[cwa1] 12/10/2020 14:01

Good luck with that. IME of a few years ago, Barclays were spectacularly hopeless and eventually I just had to move my account...

[waterloo01] 12/10/2020 13:49

Spot on. Barclays don't have the KID. Asked them to chase

[chucko1] 12/10/2020 13:47

It might be to do with KID. If they don't have an update on a particular fund or Investment Trust, they stop you buying. This is because their 3rd party provider of these things along with Barclays Smart (laughable) Investors are totally useless. Clear?

[waterloo01] 12/10/2020 13:40

Wonder why my Barclays ISA won't let me buy? Will have to call them.

[cwa1] 12/10/2020 13:37

You can buy or sell in an ISA

[waterloo01] 12/10/2020 13:05

Another large buy 2m. Out of interest anyone know the status re ISA's. I hold a number in an ISA but have noticed I can't buy more but can sell. Can do either in regular account?

[johnroger] 05/10/2020 15:43

Director/associate buy

[redhill9] 01/10/2020 08:56

The August monthly report is again encouraging with NAV of 90.08p and the comment that all interest due for August had been received. It was the additional comment regarding the investment in September in Victory Acquisition Corp that caught the eye (more details in the link in post above by rambutan2). It could mean the capital invested is "dead" money for up to two years if nothing happens but alternatively investment in a Fintech company could be exciting.