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Harmoney's first full-year results show loss

Could New Zealand's first and biggest peer-to-peer lender be growing too fast?

Tuesday, August 2nd 2016, 6:00AM

Financial statements show Harmoney lost $14.2 million in its first year of operation.

It generated $8.6m in revenue in the year.

In 18 months of operation, it has raised $30 million in working capital, assessed more than $2 billion in loan applications and faciliated more than $275 million in lending.

Across its portfolio, it now offers investors an 11.85 per cent average annual return. Since it started operating, just over 5.6 per cent of the money invested in the platform has been lost through loan defaults.

In the year to March 31, Harmoney's biggest expense was $8.1 million on marketing. Another $6.3 million went on employee costs and $2.1 million on information technology expenses.

It is believed that the company is in the testing stages of setting up its business in Australia. It is also facing Commerce Commission-brought charges over claims it misled consumers with claims they were "pre-approved".

Claire Matthews, a banking expert at Massey University, said a loss in itself was not concerning. But she said there was a risk that Harmoney could be growing too fast.

"If they're looking to set up in Australia already I'm sure they've got really good reasons but there is an argument for consolidation before expanding."

She said Australia would be a bigger market for Harmoney, which would offer it more potential for expansion.

Harmoney's lending in New Zealand has been dominated by institutional backers. While returns for investors have been good, it has been criticised for not offering borrowers rates that were significantly cheaper than banks'.

Tags: Harmoney

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Lender Flt 1yr 2yr 3yr
AIA 4.55 2.55 2.95 3.29
ANZ 4.44 ▲3.15 ▲3.55 ▼3.75
ANZ Blueprint to Build 1.68 - - -
ANZ Special - ▲2.55 ▲2.95 ▼3.15
ASB Back My Build 1.79 - - -
ASB Bank 4.45 2.55 2.95 3.29
Basecorp Finance 5.49 - - -
Bluestone 3.49 3.34 2.99 3.34
BNZ - Classic - 2.55 2.95 3.25
BNZ - Mortgage One 5.15 - - -
BNZ - Rapid Repay 4.60 - - -
Lender Flt 1yr 2yr 3yr
BNZ - Std, FlyBuys 4.55 3.15 3.22 3.85
BNZ - TotalMoney 4.55 - - -
CFML Loans 4.95 - - -
China Construction Bank 4.49 4.70 4.80 4.95
China Construction Bank Special - 2.65 2.65 2.80
Credit Union Auckland 5.95 - - -
Credit Union Baywide 5.65 3.95 3.85 -
Credit Union South 5.65 3.95 3.85 -
First Credit Union Special 5.85 2.95 3.45 -
Heartland Bank - Online 1.95 1.85 2.35 2.45
Heretaunga Building Society 4.99 3.80 3.90 -
Lender Flt 1yr 2yr 3yr
HSBC Premier 4.49 2.19 2.45 2.69
HSBC Premier LVR > 80% - - - -
HSBC Special - 2.25 - -
ICBC 3.69 ▲2.29 ▲2.69 ▲2.99
Kainga Ora 4.43 2.67 2.97 3.13
Kainga Ora - First Home Buyer Special - 2.25 - -
Kiwibank 3.75 3.34 3.34 4.14
Kiwibank - Offset 3.75 - - -
Kiwibank Special 3.75 2.49 2.49 3.29
Liberty 5.69 - - -
Nelson Building Society 4.95 2.99 3.24 -
Lender Flt 1yr 2yr 3yr
Pepper Essential 4.79 - - -
Resimac 3.39 2.98 2.79 3.29
SBS Bank 4.54 ▲2.89 ▲3.29 ▲3.49
SBS Bank Special - ▲2.39 ▲2.79 ▲2.99
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The Co-operative Bank - First Home Special - 2.29 - -
The Co-operative Bank - Owner Occ 4.40 2.49 2.89 3.19
The Co-operative Bank - Standard 4.40 2.99 3.39 3.69
TSB Bank 5.34 3.30 3.69 4.04
TSB Special 4.54 2.50 2.89 3.24
Wairarapa Building Society 4.99 3.55 3.49 -
Lender Flt 1yr 2yr 3yr
Westpac 4.59 3.15 3.49 3.89
Westpac - Offset 4.59 - - -
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Median 4.54 2.78 2.99 3.29

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