The latest Mintos Risk Score updates based on developments and data from the second quarter of 2022 are now live on Mintos. In this article, we share the general summary of the most recent quarterly changes, and you can find all other details on the Mintos Risk Score Updates page. An overview of historical changes in the Mintos Risk Score through the quarters is available as a spreadsheet on the updates page.
Overview of changes in the Mintos Risk Scores and subscores based on Q2 2022
The latest risk evaluation is based on the second quarter of 2022 and information sourced from the current payment status of the lending companies on Mintos. The results are reflected in the changes of the Mintos Risk Score and subscores for the underlying loans available for investment within a Set of Notes.
Most of the changes based on information from the quarterly updates are related to non-financial factors affecting the operating environment of the company, financial standing, and portfolio performance. These factors are usually reflected in the Loan servicer efficiency, Loan portfolio performance, and Buyback strength subscores.
A particular trend driving changes in this update is the status of the legal setup of investments in Notes. Although Mintos has already transitioned to Notes, some lending companies are still updating their security structures which affect the Cooperation structure subscore.
The Mintos Risk Score was changed for loans from 8 lending companies, with 7 upgrades and 1 downgrade. The Mintos Risk Score and subscores were withdrawn for loans from 6 lending companies (at the moment of this update, there are no active loan offerings from these lending companies).
Regarding loans from lending companies from Russia and Ukraine, their status remains unchanged since the last update, with Mintos Risk Score and subscores withdrawn for loans from these companies.
We’d like to remind you that with the launch of Notes, how we assess the Mintos Risk Score for loans from each lending company remains unchanged. Loans remain an integral part of Notes (being loan-backed securities).
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 Notes on the platform, in which case the changes are introduced as necessary.
For custom automated strategies, if you’d like to adjust your investment preferences based on the most recent Mintos Risk Score updates, you can do so in the strategy settings.
Mintos Risk Score methodology
The Mintos Risk Score is an aggregate of four subscores that are assigned to four different aspects of particular loans underlying a Set of Notes. 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.
Disclaimer: Under no circumstances should the Mintos Risk Score be treated and relied upon as a credit rating. It is not prepared in accordance with the methodology and provisions defined by the Regulation (EC) No 1060/2009 on credit rating agencies. The Mintos Risk Score is not investment advice and Mintos cannot be held liable for any losses which may result from basing investment decisions on information and/or analytical materials provided on this website.