The peer-to-peer firm has been the source of complaints from its lenders as large volumes of its loans are failing to be repaid on time.
As a result of the problems Lendy CEO and founder Liam Brooke (pictured) has sent a series of emails to lenders on the platform apologising and explaining the steps it will take to resolve the situation.
In the first email Brooke told investors that he wanted to “apologise that the repayment process has been significantly behind expectation on some of the loans you have invested in”.
“We have undertaken a thorough review of our recovery process to improve the speed at which recoveries are undertaken and ensure that we are using all the right tools to maximise recoveries,” he said.
Brooke added the business had identified five areas where it could make substantial improvements to its recoveries process: governance, financial controls, liquidity, collections and compliance.
He also pledged to improve communications with investors, including when receiving loan repayments.
Review loans valuation
In another email to investors, Brooke noted the firm had “taken steps to put a robust governance structure in place including a new board of directors”.
“In addition, we have engaged specialist agencies to review our loan valuation portfolio on a case-by-case basis.”
He continued: “As a team, they have many years’ experience in the sector and have already identified the core areas for improvement including managing the financial, regulatory and operational parts of the business.
“We believe that with the new team in place Lendy can create a more robust base on which it can develop its products and offerings.”
Brooke added that this was “the start of the process”.
New board members
The three board members joining Lendy are Paul Thompson as chief financial officer, David Gammond as chief operating officer and Gary Anderson as general counsel.
Thompson qualified as a Chartered Accountant in 1969 and has spent his career in corporate finance and fund raising.
He is regulated by the FCA, is senior partner at Prosper Capital LLP and has experience of the P2P sector including providing regulation (AR) for new platforms.
Gammond has more than 30 years’ experience in corporate finance including financial asset management, property lending and stockbroking.
He took a company onto the Alternative Investment Market (AIM) in 2005 as chairman and is directly regulated by the FCA.
Anderson has more than 25 years’ experience in corporate finance including roles as general counsel for a leading renewable energy company and as a partner in a number of the UK’s top legal firms.
He is dual qualified in both Scottish and English law.