On Mintos, we have a number of risk mitigation layers in place. One of these layers includes the parent company or group guaranteeing the obligations, that is ensuring the buyback guarantee is fulfilled, of a loan originator on Mintos.
Today, we are pleased to announce that Mogo Finance S.A., the ultimate parent company of the Mogo Group companies operating on the marketplace, now provides a group guarantee for all Mogo loans on Mintos.
This means, that in case one of the Mogo entities on the marketplace fails to fulfil any monetary claims arising from loan agreements, Mogo Finance S.A. is obliged to fulfil these obligations on behalf of the loan originator.
For example, if a loan is delinquent for more than 60 days and the loan originator is not able to repurchase the loan, Mogo Finance S.A. will do it on behalf of loan originator (this applies only for loans with a buyback guarantee).
What does this mean for investors on Mintos?
Overall, this change does not have an impact on the way you invest in Mogo loans, but it does put an extra layer of risk mitigation in place, by reducing the risk of the separate Mogo entities not being able to fulfil their obligations to Mintos investors. As a result, the rating to all Mogo group entities has been changed to A.
Mogo Finance is one of the largest and fastest growing secured used car financing companies in Europe. Mogo was founded in 2012 in Latvia and joined the Mintos marketplace in 2015, originally offering loans for investment from its home country.
Since then, Mogo’s presence on the marketplace has grown substantially and now places loans on the marketplace from nine countries – Bulgaria, Estonia, Georgia, Latvia, Lithuania, Poland, Romania, Moldova and Armenia.
As of December 31, 2018, the Mogo Group had a net loan portfolio of over EUR 140 million across its operations, a more than 40% increase compared to December 31, 2017. The total revenue compared to the corresponding period of the previous year has increased by 53% reaching EUR 54.4 million. Mogo Finance also saw a significant uptick in its client base of around 64.9% from December 2017 until the end of December 2018. Some of the equity investors in Mogo and Mintos overlap.