Funding Circle SME Income fund holds steady on dividend

By Daniel Lanyon on Monday 19 June 2017

Alternative Lending

The portfolio has issued its fifth dividend, keeping the fund in line with its stated target income.

The portfolio has issued its fifth dividend, keeping the fund in line with its stated target income. 

The £406m Funding Circle SME Income fund has paid out its fifth dividend, the fourth consecutive quarter at the same 1.625p level, holding pay-outs in line with targets.

The latest dividend, payable on 31 July 2017 to shareholders on the register as at the close of business on 23 June 2017, is a boon to investors in the fun, which has now shown a full year of regular quarterly dividends within its forecast rate.

Funding Circle SME Income fund is an investment trust listed on the London Stock Exchange that offers exposure to P2P loans originated by the Funding Circle platform. It launched Was launched in December 2015 and targets a dividend target of 6-7p per share pa, and NAV total return target of 8-9 per cent pa when fully deployed and levered. 

As the graph below illustrates, the fund has seen consistent growth in its net asset value and index has outperformed the broader UK marketplace as shown by AltFi Data’s handy Returns index. It has escaped a punitive hit to its share price as well, a problem seen in several other P2P and direct lending funds.  

The investment trust’s board has decided to offer shareholders a choice to receive dividends in cash or in shares via scrip dividend, potentially paving the way for further growth in the fund’s assets under management. 

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