16. 10. 2023

Due to an incorrect import of the provider Right Choice Finance, loans were issued on the Bondster platform with a shorter period for activating the buyback (note that instead of the usual 60 days, a period of 10 days was given for some loans). The mentioned system error led to delay in buybacks repayment of Right Choice Finance loan originator.

Immediately after discovering this serious fact, we started intensive negotiations with the provider and demanded a proposal how to solve the situation, including a detailed breakdown of incomming payments. On Wednesday 11/15/2023, a representative of the provider Right Choice Finance informed us that they are prepared to keep the overdue and future buyback guarantee given to investors, but at this time they will not meet the due dates. The provider justifies this decision by the deteriorated short-term liquidity of the entire financial group, to which Right Choice Finance belongs.

For this reason, we proceeded to lower the rating of the provider from grade A- to the lowest grade D (note that grade D refers to default providers). At the same time, we suspended the possibility of issuing new loans from Right Choice Finance on the Bondster platform. Previously issued loans cannot be offered even on the secondary market.

Although we have proceeded to downgrade Right Choice Finance to grade D, regular monitoring shows that the company has a sufficiently strong capital position. Current Right Choice group problems with liquidity, which were not foreseeable within the quarterly monitoring of Right Choice finance entity, prevent on time payment of buybacks. However, from a long-term perspective, company it self is capital strong, which suggests that it is able to meet its obligations to investors in longer term perspective.

We continue negotiating intensively with the provider and expect the installment schedule proposal that should cover both currently due and future buybacks. At the same time, we asked the loan originator to deliver an official statement for investors with a closer justification for not complying with the buyback guarantee.

Right Choice Finance promised to deliver the repayment schedule proposal by Friday 17/11/2023. We expect to continue negotiating with the loan originator on this proposal in the week of 20/11/2023. We will inform investors about the outcome of the negotiations no later than Friday 24 November 2023.

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