The latest Mintos Risk Score updates are now live. The current update is based on developments and data from this year’s first quarter. Below is the general summary of the most recent changes. For all details about the particular subscores and the Mintos Risk Score changes, visit the Mintos Risk Score Updates page.
If you’re new to Mintos or you would like to have a detailed overview of historic changes of the Mintos Risk Score, you can also find a spreadsheet with all quarterly information on the Updates page.
Overview of changes in the Mintos Risk Scores and subscores based on Q1 2021
The world is becoming better at living in the pandemic, vaccination is progressing globally, and restrictions on movement and activity are becoming more relaxed. Loan default rates have now reverted to pre-COVID-19 levels, and the ratio of non-performing loans continues to decline, signaling lower risk for investors. As a result, positive developments are influencing the profitability of some of the evaluated lending companies, resulting in a positive impact across risk subscores, but mostly causing changes in the Loan Portfolio Performance and Buyback Strength subscores.
That’s why we’re glad to say that the update based on our evaluation of information from Q1 2021 brings more positive changes to the Mintos Risk Scores than negative ones.
Overall, the Mintos Risk Score was upgraded for loans issued by 8 out of 93 entities included in this update. We’re also introducing updates for 2 entities that were added to the marketplace since the previous update (IDF Eurasia’s short-term loans entity Moneyman and the Mexican lending company Swell).
The Mintos Risk Score was downgraded only in one case.
Score withdrawn for Creamfinance and E-Cash
With this update, we’re also withdrawing scores for loans from 3 entities. Two of those belong to Creamfinance group: loans from the Czech Republic entity and loans from the entity operating in the Danish market. In the first case, the Mintos Risk Score is withdrawn as currently there are no active loans on the marketplace from Creamfinance Czech Republic, and there is no outstanding investment in loans from this entity at the moment. In the second case, the score is withdrawn due to Creamfinance’s business decision to wind down their Danish operations and exit the market.
The third withdrawn score is related to loans from the Ukrainian lending company E-Cash. In April 2021, the company initiated a wind-down while having pending amounts due to investors on Mintos. The lending company was suspended both on the Mintos Primary and Secondary Market.
Eleving group behind many changes in the Buyback Strength subscore
When it comes to subscores, the most changes were made for the Buyback Strength subscore. Overall, it was upgraded for loans from 13 entities and downgraded for loans from 2. Eleving Group accounts for most of the changes due to improved profitability and equity position on the group level (11 out of 13 upgrades of this subscore). Also, from this update on, companies previously operating under the Mogo group are attributed to the Eleving Group, across the Mintos Risk Score’s related content.
The next subscore with the most changes is Loan Portfolio Performance, improved mostly by lower volatility of issuance volumes. It was upgraded for loans in 10 instances and downgraded in one.
The Servicer Efficiency subscore was upgraded for loans in 5 instances and downgraded in 1.
In this update, the Cooperation Structure subscore remained unchanged for all evaluated loans.
To see detailed comments about all the latest changes in the Mintos Risk Scores and subscores, visit the Mintos Risk Score updates page.
Mintos Risk Score updates schedule
The regular schedule for the Mintos Risk Score updates is quarterly. Exceptions will be made in some cases when there is a significant material improvement or deterioration for specific loans on the marketplace, in which case the changes are introduced as necessary.
Note that if you want to adjust your investment preferences based on the most recent Mintos Risk Score updates, you need to update your investment strategies.
Mintos Risk Score methodology
The Mintos Risk Score is an aggregate of four subscores that are assigned to four different aspects of particular loans as investment opportunities. These subscores rate:
- loan portfolio performance (the portfolio health and historical performance of the loan book),
- loan servicer efficiency (the capabilities of the loan servicer when it comes to the collection of borrowers’ payments),
- buyback strength (the buyback obligor’s ability to fulfill contractual obligations, meet liquidity needs, and capital sufficiency), and
- cooperation structure (the legal setup between the loan issuing company and Mintos).
According to the significance we see in each subscore, the weights of the subscores are loan portfolio performance 40%, loan servicer efficiency 25%, buyback strength 25%, and legal structure 10%.
The Mintos Risk Score and subscores are expressed on a numerical scale from 10 to 1, where 10 represents a low risk and 1 represents a high risk. The score can also be shown as “Score Withdrawn”, with a value of 0, when one or more subscores are not available, or simply when there are no loans available for investment by a specific loan issuing company.
Here you can learn more about the Mintos Risk Score methodology.