9 September 2020 Since the launch of the new strategies... Read more →
April 30 update: IuteCredit has prolonged the discounts and offer validity for the buyback. Please see the highlighted details below.
IuteCredit Europe AS, the parent company of IuteCredit Group, has registered on Mintos as an investor and will buy back loans of its subsidiaries from the Secondary Market under the following conditions:
• Maximum amount up to € 5 million subject to market conditions in several tranches
• Buy-back period from Q2 to Q3 2020
• Initial buy-back tranche of € 0.5 million
• Remaining loan maturity for initial buyback tranche 3 to 9 months (maturity until 31 December 2020)
• Subsequent tranches may target loans with different remaining maturities
• Status of loans: Current and late
• Countries of loans: Albania, Moldova, North Macedonia
• Discount for the buyback: 10% for loans with maturity until 31.12.2020. and 15% for loans with maturity until 30.06.2021. (updated from 15% for all loans)
• Discounts and volumes of subsequent tranches are subject to the discretion of AS IuteCredit Europe
• Buyback offer validity: 13.04.2020 – 11.05.2020 (updated from 27.04.2020.)
Comments by IuteCredit’s CEO, Tarmo Sild
Dear Mintos Investors,
We at IuteCredit believe that the pandemic of coronavirus has a long-term depressing effect on all economies in which we operate. The process of change towards the directions has already begun.
On the regulatory landscape, the authorities in Albania, Moldova, North Macedonia, and Bosnia and Herzegovina have already committed the banking and microfinance sector to grant customers repayment grace periods and penalty waivers over the next three months. In addition, the regulators have adopted rules to ensure that customers are not treated as defaulted during the emergency period. The regulations remain subject to dynamic changes, that will depend on how the virus, society, and economy will interact.
One cannot argue with the regulatory approach and must adhere to it, as it is not only legally binding but morally justified. Customers are entitled to demand repayment of their loans at a later date. As a result, the impact of coronavirus on customer cash flows is passed on to the owners of the loans.
However, we have stopped offering IuteCredit loans on Mintos Primary Market since the middle of March. The reason is that demand for new loans by responsible customers has declined, together with IuteCredit’s appetite to increase risk in an environment where the number of unknown variables has grown significantly. Therefore, we focus primarily on converting loan receivables from our business into cash and contract our balance sheet in the most efficient way. We will continue to do so until we see that consumers and economies will find new points of stability.
In this situation, where A: the implications of mandatory regulations regarding future loan repayments are not totally clear, and we do not know how exactly customers will react; and B: the capital markets offer many alternative investment opportunities, we realize that some of Mintos investors might prefer to sell their assets now, prematurely. Therefore, we decided to test the creation of a solid aftermarket demand for IuteCredit loans, which is backed transparently with our name and our cash.
With regard to the initial buyback offer, we have decided to start offering cash for loans with a remaining maturity of 3 to 9 months. We believe that the perceived impact and the actual response of customers to pandemic regulations are likely to affect loans with a respective term the most. However, with the subsequent tranches offered in the aftermarket, we may decide to extend or reduce the scope of IuteCredit buyback offers and change also the pricing. The reaction of the Mintos market to our initiative and the situation will drive our future decisions.
Regarding your possible considerations to sell IuteCredit loans, we offer one comment, too. We assure, that all IuteCredit loans, including those purchased by Mintos investors, will be fully repaid by the loan customers or secured by IuteCredit equity holders so that creditors remain protected.
In short, we are creating additional liquidity on the aftermarket and leave the decision to our investors, whether cash is king.
CEO of IuteCredit Europe
IuteCredit – established in 2008 – is a leading European personal finance company. The Group is specialized in consumer credits via its 100% subsidiaries using equity and loan capital. IuteCredit serves customers currently in Moldova, Albania, North Macedonia, and Bulgaria as well as Bosnia and Herzegovina.
IuteCredit’s loan products are unsecured consumer loans with maturities between 1 month and 36 months and car-secured loans with maturities up to 60 months.
The mission of IuteCredit is to create an extraordinary experience in personal finance by exceeding customers’ expectations.