Funding Circle shares bounce back

The firm has just published its first set of quarterly results as a public company.

When Lending Club’s head of communications Anuj Nayar called AltFi a few weeks ago to talk about Funding Circle, he preached the importance of execution.

“It’s all about laying out what you’re going to be able to achieve in the future, quarter by quarter, and then executing against it,” he said.

So far, Funding Circle is doing just that.

The company endured a turbulent first few weeks as a public company. After just a few days of trading, its shares had lost roughly a quarter of their value. But the peer-to-peer lender’s shares have now recovered to 432p, just a touch shy of its listing price.

Funding Circle’s performance in the third quarter may well have contributed to the bounce-back. This morning, the firm published its first quarterly update since floating on the London Stock Exchange. The numbers show significant growth, with loans under management at £2.8bn by the end of the quarter, up 61 per cent compared to same period last year. Originations also increased, while net returns remained stable, even increasing a little year-on-year.

Importantly, Funding Circle’s full year growth expectations remain unchanged.

Investor confidence may also have been buoyed by the revelation that neither of Funding Circle’s two biggest backers – Index Ventures and Accel – sold shares as part of the company’s £1.5bn IPO, suggesting they back its long-term growth prospects.  

But short-sellers of the stock are also starting to circle. Yesterday, The Evening Standard reported that 1.74 per cent of the firm's shares are out on loan with short-sellers. 

Commenting on the firm’s first quarterly results, Funding Circle co-founder and CEO Samir Desai (pictured) said: “Funding Circle delivered a strong quarter of growth with loans under management of £2.8 billion and a record quarter for originations. The business continues to deliver our growth strategy and we remain focused on building Funding Circle for the long term.”