Funding Circle Outlook Improves As It Sees Strong UK Momentum

(Alliance News) - Funding Circle Holdings PLC on Tuesday reported a strong performance to date ...

Alliance News 24 November, 2020 | 11:20AM
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(Alliance News) - Funding Circle Holdings PLC on Tuesday reported a strong performance to date and lifted its outlook.

Since its half-year results, the London-based peer-to-peer lender said it has continued to see "high demand" from small businesses to borrow and investors to purchase loans on the Funding Circle platform. As a result, in the four months to October 30, total income was up 38% year-on-year.

This has been driven by "strong momentum" in the UK, with total income up 67% in the period. In total, the firm has approved around GBP1.85 billion and originated GBP1.35 billion of CBILS - Coronavirus Business Interruption Loan Scheme - loans as at November 15.

Since the start of the second national lockdown, Funding Circle said it has not seen "any material impact" in the number of borrowers making payments so far.

In the US, total income was up 10% in the period, driven by investment income.

"With the timing around any future economic stimulus uncertain, we continue to work with other lenders in the market on our US referral model and we expect to relaunch our core lending product when conditions allow," the firm said.

As a result of its strong performance to date, Funding Circle expects total income in the second half to be ahead of the first six months of the financial year, and 20% higher for the full-year versus 2019.

Funding Circle now expects to be profitable on an adjusted earnings before interest, taxes, depreciation and amortisation basis in the second half, "materially ahead" of previous guidance of close to breakeven.

Shares in Funding Circle were up 4.0% at 92.55 pence in London on Tuesday.

By Lucy Heming; lucyheming@alliancenews.com

Copyright 2020 Alliance News Limited. All Rights Reserved.

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Securities Mentioned in Article

Security Name Price Change (%) Morningstar
Rating
Funding Circle Holdings PLC 60.40 GBX 1.68 -

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