The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
I would tend to agree with the above. When I've read people saying "Amigo shouldn't have given them the loan" I just think, where does it stop? Should a car dealership check someone doesnt like a few pints after work incase they run someone over whilst p*$$ed, or a phone vendor check to ensure that phone wont be used to run a county drug line etc?
I would even agree with a regulation that meant who ever provided the first loan to a customers gets "dibs" first, so those lending on top of other loans or credit cards are at the back of the queue (this would force companies to ensure they do proper checks or else they risk being at the back of the queue when nothing is left).
I've never been in a situation where I can't pay back loans, so maybe I take a more hardlined view that others might.
Gordie, Shareholders haven't lent any money to help the business grow - I have lent exactly £0 to Amgo, but I have given someone else alot of money to buy their % of amigo off them, in the hope it becomes more valuable (either by capital growth or dividends etc). Bondholders have provided the funds, and whilst won't see exponential returns like we could, they are guaranteed their money back incase/when things go wrong.
Some might argue shareholders have taken a battering already, with the shareprice falling from pounds down to pence or 'losing' 15% on future profits to the SOA. however, most people on this board are up considerable sums having bought in over the last 12 months and 85% of profit going forward is much better than 100% of nothing.
Why should people like Toger be able to go on a family holiday, or others pick out fancy cars when customers with Legitimate claims (and I'm not talking about those who have jumped on the bandwagon because they didn't like paying the loan and thought it was unaffordable) be left with essentially zero? Why should someone who has been wronged and potentially stressed for years about debt not be allowed a holiday? (Note, this is not a pop at Toger, I'm only here to make money for the purposes of having nice things too!). I would not be complaining if the % of the profits started at 50% year 1 and tapered down as we got to year 4 or 5, or if something more exotic was proposed.
So GJ and the team advised there were close to 1m past and present customers who would be eligible to vote, yet the turn out appears to be under 80,000 which would suggest only 8% (lets say 10%) of customers voted? Whilst I would expect things to go through no problem with such a large % voting in favour and the FCA not turning up at court, could such a low "turnout" cause any issues do you think? Can the argument be made that the vote is almost moot because such a low % took part?
I couldn't believe my eyes this morning and thought I'd pulled a fast one buying at 26p (my average before was 8p) - just wished I'd waited an extra 45 minutes haha.
LTH, Amigo will have fluffed their numbers up in anyway possible to make it more attractive. Nobody would come out of the gates saying it will be 10p in the pound. The more claims they allow, the lower the pence in the pound people will receive (obviously), the only curve ball is the % of future profits as theres no way to know what these can be without some sort of idea what future products/customer numbers will look like.
Personally, I think once all is said and done (after years) customers will end up with high-teens as recompense.
Blind, out of curiosity and because of your background, if customers have gone via a CMC when submitting a claim to AMGO, do the CMCs have the vote (so to speak) as they are sorting things for the customer and if CMC's do have the vote or at least are advising customers on how to vote, would you think the vast majority of CMC's would encourage to vote for the scheme so that the CMC still retain some form of £ out of whatever or are they advising against the scheme as to try and make AMGO come back with a improved scheme?
Interested in your input (as I was when you were active on the board a few months back). Thanks.
No, Amigo said they would class all loans as "mis-sold" for the purposes of the vote, i.e anyone with a loan could vote. (presumably, to allow as many happy customers as possible to vote) However, only those with a valid claim will be able to receive cash/balance adjustments in the scheme. There is then a seperate company (I want to say PwC?) that will oversee any disputes between AMGO and the customer, kind of taking over from FOS as the arbitrator.
I would ignore Debt Camel, its pointless - you can only really make a point on Twitter as she only approves the comments she wants to approve on her blog. It's near impossible to predict the pence in a pound for Amigo, as they are adding a share if profits even 4 years from now.
I do find it odd that she nudges people will a settled loan towards voting No, rather than receiving a few quid - she often says "is it worth £100 for the hassle this company puts people through" guiding people back to how much they hate the company and forego any redress.
JPM hold the vast majority themselves (7.8%) whereas Bybrooks is all financial instruments, under section DTR5.3.1R.(1) (b). My thought is Bybrook has an agreement with JPM to aquire the shares at a certain value.
According to the FCA, Section 5.3.1R states the following (which covers (1) (a) and (1) (b);
(1) A person must make a notification in accordance with the applicable thresholds in n DTR 5.1.2R in respect of any financial instruments which they hold, directly or indirectly, which:
(a) on maturity give the holder, under a formal agreement, either the unconditional right to acquire or the discretion as to the holder’s right to acquire, shares to which voting rights are attached, already issued, of an issuer;
or(b) are not included in (a) but which are referenced to shares referred to in (a) and with economic effect similar to that of the financial instruments referred to in (a), whether or not they confer a right to a physical settlement.
I doubt there'd be much point. If (as per your example) 90% have voted yes, then it doesnt matter if everyone else votes No, because the vote will have passed quite easily.
I think the clue will be if Amigo crank up adverts or change the way in which they're displaying the information, this might indicate the vote isn't quite going their way and they're trying to catch the last few people who might be obliged to vote Yes i.e old customers who aren't aware and will almost certainly vote for 'free money'. I'm happy with not hearing much, as I'm taking that as what they've done from Day 1 is enough to progress with the SOA.
LTH, Theres a caveat to that statement though. The 38% is derived from AMGO putting in 38.85p per £1 for every £1 under the £85m balance adjustment pot. "So, for each £1 by which £85m exceeds the actual gross balance adjustment, Amigo will contribute cash of 38.85p, up to a maximum of £20m, to SchemeCo" is the exact wording as per the Scheme website.
If balance redresses amount to £85m, there will be no further topup to the initial £15m cash pot. If balance adjustments come to "only" £80m, 38% of the £5m unused balance would be £1.9m cash added (making a total of £16.9m cash pot).
In all honestly, theres no way to know what % of a £ will be repaid, because we dont know 1) how many claims there will actually be (well, upheld claims) 2) we don't know the amount of balance reductions, and thus the total extra money to be added by AMGO and 3) We dont know how profitable AMGO will be over the next 4 years providing further funds. I think Sara is just saying "maybe less than 5%" because of other companies that have fellen before paying out single digit pence in the pound.
This is obviously only for those customers who expect a cash refund (i.e settles loans), those who get a balance adjustment could well see 100% of their claim paid in the form of balance adjustments.
PB, without a doubt. If they weren't working on new stuff and setting the wheels in motion, I'd want them out the door. But my post was in relation to Bryn saying it was possible for a re-lending RNS next week. I could even get on board with a re-lending RNS sometime in May when people thought the vote was "in the bag" and it was essentially too late for people to change their minds.
I think April will be quiet in terms of news and updates, and then all hell will break loose in May with the SP moving quckly in either direction (based on the outcome of the vote).
Not a chance. Amigo need to look as distressed as possible in order to play the "If we dont get SOA, Amigo is no more" card. GJ has personally made videos on youtube for the scheme website stating such. Imagine the fall out if Amigo where to claim that, and just a week later announced a return to lending, which would should the company has life and longevity - it would essentially push everyone to No in order to submit a claim and look for much more than they would get in a SOA.
Personally, I think we're going to float between 12-16p from now until Vote results are in.
Are the votes from customers from the early days certain to be allowed and not removed? I.e How can the vote possibly be fair if customers from, say 2005-2008 had proper loans (lets speculate things got sloppy towards the end, rather than the get go) and would never have a claim upheld by either AMGO or PwC, then how can their weighted vote be allowed to skew the vote when customers who do have a valid claim may have voted "Against"?
Obviously from ISA's post last week, alot of stuff was "this is for the next hearing" type scenarios, and I wonder if this will be one of them?
It appears those who vote Against the scheme have the option to change their vote prior to the vote closing. This is a brilliant idea - means those who vote in the heat of the moment could end up changing their vote, should they see Martin Lewis talking about this on TV over the coming weeks etc.
Whilst I would expect "for" voters to have the same option out of fairness, I hope they don't have that option ;)
Mouse, at 49.9% APR with a loan of £5,000 over 5 years, the total repayable would be in the region of £13.5k (£8.5k Interest and £5k principle). That equates to a liftetime interest of ~170% (that using the MSE calculator).
Of course, if you pay the full loan back over the course of a single year, its £2.5k interest (so £7.5k total repaid)
Craigyboy, if any of Amigo's customerbase could think like that, they probably wouldn't be sub-prime. Sub-prime typically want the fish now rather than a fishing rod to have unlimited fish tomorrow. Lots of Green reviews coming in now, just hope this isnt idle Amigo staff giving me a false sense of hope haha!
Just a quick thought (ideally Blindinvestor could've answered this, being a CMC, but doesn't appear to frequent these boards now).
Customers who have gone through a CMC to pursue a claim (which from reports is a high %), do we know if these guys are voting on behalf of their clients? I.e would 10k+ CMC with "current" AMGO customers vote FOR the SOA in order to get their hands on ~30% of the smaller cash refund, as opposed to voting AGAINST and essentially getting nothing?
Sara is referring to balance adjustments - people who still owe money and have a valid claim during adminstration. The remaining interest would be removed and an affordable payment plan setup. If someone has paid more than they initially borrowed the entire balance would be wiped, but no further money would be actually refunded.