Of the 54 loans that were still active when Lendy collapsed in May, just three will remain unaffected by insolvency action.
“It shows the issues at Lendy,” said RSM Restructuring Advisory partner Damian Webb who is overseeing the recovery of as much capital as possible for investors.
One of the biggest issues is the accuracy of valuations from the firm, with Webb confirming that only around 30 per cent of the original values are being collected on average against outstanding loans.
This ranges from no recoveries, negative recoveries where the administrators costs outweigh any funds received, to in one or two occasions, full recovery.
“It was a very marginal loan book, they were the sort of loans that experienced or mainstream lenders would have not lent against,” Webb told the NARA property receivers conference.
“When you get into the details of these loans, [you realise] all these issues that people learn through lending, if there had been a level of experience in the initial underwriting you probably wouldn’t have seen this level of default.”