UAB

NEO Finance

Board report 2017Q4

Vilnius

2018-01-10

Press releases

2

Paskolų klubas granted loans for

10 000 000€

Read more

Comment on Paskolų klubas launch

success Read more

October

Training sessions for beginners and experts in P2P lending

in Kaunas

Special event with Practica Capital in Vilnius

November

Training sessions for beginners in P2P lending in

Klaipėda, Šiauliai, Panevėžys

December

Training sessions for experts and beginners in P2P lending

in Vilnius

Special event with Business Angels Fund

Social events

P2P platforms in Lithuania are the

most regulatedRead more

Material events

3

Evaldas Remeikis became a Chair of

Fintech Lithuania Infobalt association

group

A milestone of 1 million EUR loans

issued per month in November, 2017

Shareholder equity raised to 1 921 503

EUR, total amount invested in

company‘s capital exceeds 2.55M;

A milestone of 10 million EUR of

accumulated loans issued by the end of

November, 2017

P2P consumer loan market in Lithuania

4

In 2017 Q4 P2P consumer loan market size reached 5.46 million EUR. Compared to 2016 Q4 year on

year the issued loans volume grew by 82% from 2.99 million EUR. “Paskolų klubas” market share

during 2017 Q4 remained stable at 53% with 2.87 million EUR of loans issued.

Monthly amount of issued consumer loans through all Lithuanian platforms reached a peak of 1.95

million EUR in December. “Paskolų klubas” reached a record of 1.02 million EUR financed in

November. Compared to the same month in 2016, “Paskolų klubas” issued loans volume grew by

145%.

0.55 0.59 0.67

0.52 0.60

0.75 0.74 0.80

0.86 0.901.02

0.95

1.27 1.26

1.39

1.08

1.28

1.45 1.42 1.54 1.57

1.66

1.84 1.95

2017-01 2017-02 2017-03 2017-04 2017-05 2017-06 2017-07 2017-08 2017-09 2017-10 2017-11 2017-12

P2P consumer market, loans issued, million EUR

Paskolų klubas Market size

Borrowers

5

In 2017 Q4 low fees and brand growth attracted

3 922 new registered borrowers. At the end

of 2017 Q4 the number of registered borrowers

grew to a total of 36 373. Compared to 2016

Q4, the number of registered borrowers grew

by 86%.

In 2017 Q4 the number of active borrowers grew

by 716 users. At the end of 2017 Q4 the number

of active borrowers reached a total of 3 572.

Compared to 2016 Q4, the number of active

borrowers grew by 240%.

25201

28925

32451

36373

0

5000

10000

15000

20000

25000

30000

35000

40000

2017 Q1 2017 Q2 2017 Q3 2017 Q4

Registered borrowers

1668

2249

2856

3572

0

500

1000

1500

2000

2500

3000

3500

4000

2017 Q1 2017 Q2 2017 Q3 2017 Q4

Active borrowers

Investors

6

In 2017 Q4 investors‘ trust, stable returns and

transparent communication attracted 922 new

registered investors to a total of 6 024.

Compared to 2016 Q4, the number of

registered investors grew by 96%.

Investors have already earned 1 million EUR in returns.

In 2017 Q4 the number of active investors grew

by 672. At the end of 2017 Q4 the number of

active investors reached a total of 3 653.

Compared to 2016 Q4, the number of active

investors grew by 130%.

3909

4516

5102

6024

0

1000

2000

3000

4000

5000

6000

7000

2017 Q1 2017 Q2 2017 Q3 2017 Q4

Registered investors

2070

2573

2981

3653

0

500

1000

1500

2000

2500

3000

3500

4000

2017 Q1 2017 Q2 2017 Q3 2017 Q4

Active investors

UAB NEO Finance investments

7

UAB NEO Finance, as a consumer credit provider, co-invests into loans together with investors. A

policy of avoiding conflicts of interest is provided to every investor. In 2017 Q4 UAB NEO Finance

invested 261 thousand EUR.

Since the launch in December, 2015 UAB NEO Finance investments into loans reached 895

thousand EUR.

65

111

229

261

0

50

100

150

200

250

300

2017 Q1 2017 Q2 2017 Q3 2017 Q4

NEO Finance investments, K EUR

Revenues

8

UAB NEO Finance earns

income from three revenue

streams:

• Revenues related to P2P lending

• Revenue related to the issuance

and processing of electronic money

• Investment income

It should be noted that the vast majority of revenues related to P2P lending activities

are distributed throughout the loan period, and this income is obtained only by actual

repayment of the monthly instalment of the consumer credit recipient. The company

chose this type of income collection due to the requirement of the Law on Consumer

Credit and because it has the maximum interest itself not only in origination of the loan,

but also in the return of the principal and interest to investors. When an enterprise

collects a brokerage fee in this way, the company's income in the financial accounting

is deferred to future periods, therefore the company's income calculation procedure

differs significantly from other market participants and therefore is not comparable. It

needs to be emphasized that during the inspection of the company, the Bank of

Lithuania noted that such method of collecting revenue is the only way in full

compliance with the requirements of legal acts.

2017 Q4 2017 Q3 ∆, % 2016 Q4 ∆, %

Income 170 125 36% 43 300%

P2P income 121 93 30% 45 171%

Electronic money income

3 2 19% 1 164%

Investment income

47 30 57% -3 -

61 78

93

121 2

2

2

3

13

20

30

47

76

101

125

170

-

20

40

60

80

100

120

140

160

180

2017 Q1 2017 Q2 2017 Q3 2017 Q4

Income, K EUR

P2P income Electronic money income Investment income

Overdue loans

9

At the end of 2017 Q4 out of 4736 issued loans - 284 loans, or 6.00%, were overdue for

more than 90 consecutive days. Respectively, out of 11.51 million EUR financed – 737

thousand EUR or 6.40% were overdue more than 90 days.

“Paskolų klubas” is highly concerned about loan repayments, therefore great effort was put in a

recovery of payments from terminated loans . During 2017 Q4 a total of 32 thousand EUR

were recovered and distributed to investors.

2.15%

5.96%

11.34%

6.40%

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

A rating B rating C rating Total

EUR, overdue >90 days, %.

4

23

17

32

0

5

10

15

20

25

30

35

2017 Q1 2017 Q2 2017 Q3 2017 Q4

Amount recovered, K EUR

Provision fund

10

“Paskolų klubas“ offers a „Provision Fund"

service, which allows investors to reduce their

investment risk. If a loan defaults – “Paskolų

klubas“ guarantees to repay the investor with

all of the assets. During 2017 Q4 the service

covered 59 367 EUR.

For liquidity risk management, “Paskolų klubas“ calculates the sufficiency of

funds to cover liabilities under “Provision fund“ and holds these funds in a

separate bank account. The purpose of this account is to ensure the company's

internal cash flow management. In order to fulfill its obligations to investors, the

company may, if necessary, use other assets of the company.

The fund's growth amounted to 14 738 EUR. At the end of 2017 Q4 there were

153 605 EUR of accumulated funds, and the total guaranteed amount was

1 381 864 EUR, resulting in 11% coverage ratio.

97

117

139

154

0

20

40

60

80

100

120

140

160

180

2017 Q1 2017 Q2 2017 Q3 2017 Q4

Provision fund, K EUR

743

939

1159

1382

0

200

400

600

800

1000

1200

1400

1600

2017 Q1 2017 Q2 2017 Q3 2017 Q4

Guaranteed amount, K EUR

Buybacks

11

“Paskolų klubas“ offers a buyback service. When an agreement with a borrower is terminated, investors have

an option to sell their investment for 50-80% of it‘s face value to “Paskolų klubas“. In 2017 Q4 investors sold

1082 investments for 15 490 EUR.

5,593 €

10,755 €12,444 €

15,490 €425

565

806

1082

0

200

400

600

800

1000

1200

0 €

2,000 €

4,000 €

6,000 €

8,000 €

10,000 €

12,000 €

14,000 €

16,000 €

18,000 €

2017 Q1 2017 Q2 2017 Q3 2017 Q4

Buybacks

Buybacks, EUR Buybacks, units

Secondary market

12

Secondary market is a feature where investors can sell or buy investments. It allows investors to adjust their

risk exposure in pursuit of aggressive returns, or sell a nonperforming investment. It also provides liquidity

when an investor feels the need to cash out. During 2017 Q4 secondary market turnover reached 106 078

EUR. Average transaction was 20.23 EUR.

38,401 €

52,975 €

68,206 €

106,078 €

1712

2681

3901

5244

0

1000

2000

3000

4000

5000

6000

0 €

20,000 €

40,000 €

60,000 €

80,000 €

100,000 €

120,000 €

2017 Q1 2017 Q2 2017 Q3 2017 Q4

Secondary market

Turnover, EUR Turnover, units

13

Main statisticsSince launch till the end of 2017

Q4

3653Active investors

3,145 €Average amount

invested

1,007,180 €Interest received

11,513,562 €Issued loans

Investments sold in

secondary market

306,485 € 8,866,304 €Outstanding principal