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It’s not deramping. I’ve posted nothing other than facts or the truth from figures and press releases widely available. I have an interest in Amigo not going bust or struggling, I just find it baffling that some people continually post hazy eyed drivel and just quote one side of the story. Anyone with a brain knew what was coming in the last few months and into the future. JB is a brat, but at least he’s dialled in to the cold hard facts.
You couldn’t be more wrong if you tried. Many complaints will be thrown out by the FOS? You do know the uphold rate is currently 95%, right? It’s cost the company £120m and rising. Some of you need to get your heads out of your arses and wake up.
Malpenn - Yep, and this all comes round full circle to what JB stated months ago when he started his tirade. They knew what the new FOS/FCA rules and expectations were, yet continued to fund thousands of loans under the exact terms that were going to bite them on the arse. The incompetence and mis-management is in another stratosphere.
Whoever mentioned the £700m loan book below....that £700m isn’t worth anything if the overwhelming majority of those customers only give back exactly what they borrowed with an upheld complaint. Add in retrospective refunds, FOS fees etc and that £700m eventually becomes a negative number.....as the £120m and rising figure given today demonstrates. Company is fine for cash - for now.
Been telling everyone on here for weeks and weeks that the complaint cost was a massive issue and out of control and would be £100m+....that's just for the last FY! You can expect that figure to be substantially more in 2020/21. Very real risk that Amigo goes bust in the next year without support.
I’m glad people think a new poster like blindinvestor is more trustworthy - I have been posting literally exactly the same stuff for weeks and just been called a deramper :-)
Perhaps people are finally getting the message on the claim problem at last. Listen - there is a reason the share price has tanked and not recovered barring a few speculators making a quick profit. I’m not even sure the yearly figures next week will even be accurate on claims amounts. They keep changing it every few weeks, they have no idea what the final cost is going to be.
That is correct. Borrowers still have to pay back any money borrowed, the interest is just removed. But if it goes to the FOS it costs £650, so that customer is a net loss for Amigo.
The issue is a big change in the FOS and FCA stance. A couple of years ago only around 20% of complaints were being upheld. By early 2020 this had risen to between 90-95%. The relatively small figures on the past Amigo quarterly statements reflect the low uphold rate, but now the uphold rate is so high, this will rocket to an unknown figure of £35m+
Customers who have had any loan in the last 6-8 years can retrospectively get refunds, even if they have fully repaid on time, and this will be the potentially killer blow. The unknown is just how many will try and claim, hence the wide estimates of total cost.
Malpenn - I don’t think you understand the scale of the complaint problem.
Saying they have 8 weeks to resolve them and that is plenty of time is one thing.....in reality thousands or tens of thousands of complaints are taking way beyond that, and up to 5/6 months without resolution yet. Their aim is to be in a position by the end of October to return to the 8 week timeframe. If they miss their next FCA deadline they are finished IMO. They’ve missed one (end of June), they won’t be allowed to miss two.
Also the cash situation - I’ve seen analyst forecasts of this costing up to £200million (could be wrong of course).
It was £35m in May, then ‘materially higher’ , which could be any amount between the two. I would hazard a guess at it being easily £100m plus. It’s no real surprise the share price is where it is really.
The business as it sits is fundamentally weak without a change in regulation, or change in lending practice and massive uptake of new criteria loans generating revenue.
People are reading the whole claims issue completely wrong. Their new FCA agreement is to be in a position by the end of October where they can clear the current backlog and answer new complaints within the 8 week timeframe that they should be, preventing a mountain of these going to the FOS. People at present have been waiting 5-6 months plus without any response. This issue isn’t going to magically disappear in October. They need to hope they actually hit their deadline target this time or it’s disaster stations - my view is that investors aren’t piling in on this fear. If they’ve missed one, who’s to say they will hit this next one? Miss that and the FCA will come down like a ton of bricks.
There was never any real risk of administration at the moment. They have enough cash to survive - it’s the future that counts.
The agreement with the FCA is to get themselves into a position by October where all complaints can be resolved within 8 weeks - which they should be anyway - which stops them going to the FOS en mass and costing £650 a time. People at present have been waiting 5-6 months plus without a response in a large number of cases.
The future is uncertain though.....if the company was as strong as it was a couple of years ago, the share price would reflect this. It was almost £3 a share, and was 5p a couple of days ago. Investor confidence isn’t there at the moment.....but who knows. This could all change and explode again.
Steven P - there aren’t the fundamentals there to drive this into the stratosphere at the moment. It’s a company still up for sale remember...depends who buys and what their future vision is. At present it’s a slow sleep walk into oblivion, as Mr Benamor has stated on numerous occasions.
They are just an investment research firm, they can say what they want. They want 3 grand to see the report though! Do people think it isn’t true then? You’d rather believe the much lower £35-£50m figures the company are quoting? They’re hardly going to be shouting that they could lose £200m plus from the rooftops are they! They are lowballing the public figures for protection, nothing more.
https://www.everestresearch.co.uk/product/amigo-loans-memo-290620/
This report reckons the redress cost will be around £206 million, with a third of loans dead wood. Sounds much more realistic to me than the £35-£50m Amigo are trying to con people into believing.
An interesting theory specialonek. Probably has a slim chance of being true. If that ever came to light and he got caught with evidence, he’d be doing a long stretch. He was wealthy anyway, why would you risk it?
From James Benamors twitter feed this morning:
To be clear, Hamish knowingly altered Amigo’s complaints policy to class over 95% of Amigo loans as irresponsible, but continued lending tens of millions a month to people who exactly matched that profile. When I gave him & the board evidence of this they made no changes.
So all you doughnuts saying they are in a strong position, they aren’t. This is the company in a nutshell. 95% irresponsible, and tens of thousands of people now almost 100% likely to get their money plus more back. Cash balance draining by the day. Anyone know if they’ve since changed this?!
I quote:
Do you think that all 9k complaints are legit, and not based on affordability and signed agreements? There will be dodgy claims however that is not the issue. The issue is FCA are upholding upto 95% of recent claims. Yes 95% of legit claims, not all claims where you say 'I can't pay, don't want to pay, let try ti on!'' That does not work with FCA and fruedent claims can end people!
I don’t think you understand pal. It doesn’t make one bit of difference. People have been complaining to Amigo......Amigo have rejected their complaint, saying we don’t agree. People then send them to the FOS. The FOS upholds 90% of these - that’s all claims that make it to them. Which means they only think 5-10% aren’t legit. If the FOS say no, then they just pay back their loan as agreed. It makes no difference to the person who has complained at all.
That’s why the claims companies are swooping in, they’ve seen the uphold rates and want a big cut of that pie. PPI is gone so they need their next money maker. This is it for them right now.
Everyone knows the whole interest rate comparison thing is a load of crap. PDLs just come up more expensive due to the smaller amounts/timeframes involved. You can only ever repay twice what you borrowed under PDL rules now. Amigo will let you borrow £4K and repay £9.5k if you repay over 5 years, nearly 2.5 times the money borrowed. They are lending to exactly the same people, just on a ramped up scale.
It’s just putting lipstick on a pig. They are wolves in sheep’s clothing.
Now....who are the cowboys again? At least Dick Turpin wore a mask when he robbed people :-)