Monio crowdfunding platform takes extraordinary measures to prevent small savers from incurring big losses. Sparebank 1 SR-Bank will also provide emergency aid to companies to prevent more projects on the platform from collapsing.
– It’s about rebuilding trust in Monio, says Glenn Sæther, Monio’s president and managing member of Sparebank 1 SR-Bank Group.
Monio is among the country’s largest players in crowdfunding. The platforms allow ordinary people to put their savings into corporate loans, often players in the real estate industry who cannot get loans from a bank.
In several cases, E24 has highlighted projects that received funding through Monio, but have since encountered significant challenges and defaults.
The company, which is now owned by parent bank Sparebank 1 SR-Bank, will raise a double-digit amount of one million to limit potential losses for about 1,800 small savers.
“The solution we want involves Monio covering part of the loss investors are about to incur as a result of some bad loans,” says Sæther.
In addition, SR-Bank will provide emergency aid to other companies on the platform, to prevent other projects from collapsing and more investors to suffer new losses.
Crowdfunding: Big differences in the non-performing loan ratio
48 million non-performing loans
He previously told E24 how since 2018 Monio helped Viggo Ekeberg Amundsen companies borrow NOK 160 million from Norwegian small savers, without disclosing that Amundsen was placed under bankruptcy quarantine and convicted of embezzlement.
Monio claims that they only became aware of the information about Amundsen’s history when it was presented to them by E24. Subsequently, the company chose to discontinue a planned developer loan. Monio now states that all 23 loans to the developer companies have defaulted and have been transferred to debt collection company Intrum for recovery. Here, the lenders have NOK 40 million outstanding.
Amundsen, via his lawyer Karl Bohr, says he believes Moneo is liable for the bad loans.
– Monio had all the necessary background information in 2019 and had no basis in contractual law to stifle further funding for our clients’ companies and projects in connection with the articles in E24. This is pure opportunism. When planned financing in ongoing projects is abruptly halted, it is inevitable that there will be a “default” towards investors. Responsibility for that rests with the Monio, Bore wrote in an email to E24.
Monio CEO Marius Debdal told E24 that they “disagree with this description of reality,” and emphasized that they did not have all the relevant information.
E24 also reported that Monio paid a bankrupt MG Eiendomsutvikling 2 company, MG Eiendomsutvikling 2, to complete a cabin in Uvdal, without checking for a cabin on site.
The small savers who have invested in the project have approximately NOK 4.5 million. Plus, they have about 4 million hanging in another cabin that’s almost finished. In total, the investors own approximately NOK 8.5 million in the two cottage projects.
Stein Martin Gaarder, former president, managing director and owner of MG Eiendomsutvikling 2, told E24 he did not want to comment on the case.
You must have an Intrum blessing
The solution will include all 1,800 savers who have invested in loans to the above companies. What the move will cost Monio in kronor and ur Neither Chairman nor CEO of Monio Marius Dybdahl will give exact figures.
They justify this by the fact that the loans have been reported in default and have been transferred to debt collection firm Intrum Capital for recovery. Thus, the crisis solution Monio envisions would require Intrum’s blessing.
– Possible solution requires that we reach an agreement with Intrum. Basically, Intrum has the legal responsibility to recover the loans. Deepdale says this is consistent with the agreement investors made with Monio.
Sæther and Dybdahl say they hope the parties can agree quickly, so they can push a stake out to investors as soon as possible.
When asked if such a solution could not imply discriminatory treatment of people who loaned their savings through the Monio platform, Chairman Glenn Sather replied:
– We did an analysis of Monio’s entire loan portfolio, and found that these two companies stand out significantly from the others, says Sæther.
– It is true that these loans clearly stand out from other Monio clients. This is because Monio clearly had all the necessary information about the owners’ background several years before these loans were granted. When Monio now believes that the information Monio provided to potential investors was insufficient, Monio must therefore bear the consequences. However, our client has not heard of any compensation for retail investors, Amundsen’s attorney, Carl Bore, wrote in an email to E24.
Stein Martin Garder, former general manager, owner and chairman of the board of directors of MG Eiendomsutvikling 2, previously did not want to comment on the characteristics of the Monio Chief.
The Consumer Council believes that loan brokers have broken the law
Provides emergency assistance to borrowers
The Monio boss makes no secret that the cases the E24 discussed gave the company a solid scratch in the paint. Sparebank 1 SR-Bank will now take action to reduce the number of completed projects.
– We see that confidence in Monio is significantly weakened as a result of the cases discussed at E24. When trust in the platform disappears, so does access to capital. This has made it difficult to secure more funding for the good, viable projects you need on the platform, says Sæther.
– Sparebank 1 SR-Bank will now set up a team to evaluate projects for which we are likely to provide financing. Then we enter into a dialogue with borrowers about how to proceed. He adds that this will help more investors avoid unnecessary losses, and that our borrowers will be able to complete their projects.
– Will companies that receive “emergency aid” get a better interest rate than other companies that have loans owed through Monio?
– We will agree to almost the same terms as Monio, replies Sæther.
Crisis meetings with investors
In the wake of the E24 article series, hundreds of investors have found each other through the Monio Investor Facebook group. Initiator Bjørn Kløgetvedt, along with a group of other investors, recently held several meetings with Monio’s management and board of directors.
Investors made it clear at the meetings that they have clear expectations of reimbursement for the loans discussed in this article.
– We expect Monio and company management to clean up and take responsibility, rather than pass the bill to investors, Kløgetvedt tells E24.
– When it turns out that many of the basic requirements of loan obligations fail, we have to respond. It is detected that the borrower does not meet the necessary security requirements or deletes important information. In addition, Monio has conducted rejected and minor case management. It is believed that such circumstances are not “normal risks” associated with investments in real estate development.
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