We’re informing you that we have made a decision to suspend loans originated by Wowwo from the Primary and Secondary Markets on Mintos until further notice. The suspension is effective immediately.
The suspension is a cautionary measure to protect investor’s interests that is driven by macroeconomic changes which impact Turkish Lira exchange rate towards Euro. Given that Wowwo issues loans in Turkish Lira, but places them on Mintos in Euro, the company needs to pay the exchange rate difference from its own resources when forwarding borrower payments if Turkish Lira value drops.
We have been monitoring the developments in Turkish Lira exchange rate towards Euro and Wowwo’s ability to cover the exchange difference and make the settlements, which historically were done timely, in more depth since September when Turkish Lira started to depreciate.
To avoid further exchange rate losses, at the beginning of December, a decision was made that new loans originated by Wowwo should be funded in local currency, and not through Mintos. Consequently, the listing of new Wowwo loans was stopped.
After another interest rate cut by the Turkish Central Bank yesterday, the Turkish Lira continues to depreciate rapidly, which could create a challenging environment for the company to meet its obligations towards investors on Mintos in a timely manner. Hence we are now suspending Wowwo from the Primary and Secondary Markets.
There is currently no indication that the borrowers’ ability to repay their loans has been impacted.
Wowwo, with headquarters located in Istanbul and operations in more than 54 cities across Turkey, sells second-hand cars with a company direct financing model to consumers in Turkey.
The current amount of Wowwo outstanding investments on Mintos is €17 784 132. There are 41 249 investors with active investments in Wowwo loans, with the average investment per investor being €431. The current amount of pending payments is €240 429.
Suspension of a particular lending company occurs when Mintos intervenes in the Market – Primary, Secondary, or both – to stop investing due to concerns about a company’s operations. Once suspended, new investments cannot occur until the suspension is lifted or lapses. When both Markets are suspended, this is intended to protect investors’ interests by preventing investments in new loans on the Primary Market, or the sale of existing loans issued by Wowwo on the Secondary Market.
We will share more as soon as we have further information.