Casas Finanzas

🖋️ There’s plenty of money in the world, but where can you get it? Liquidity in business is always a challenge, especially when you have a long cycle and all your funds are tied up in working capital. But there’s plenty of money in the world—the issue isn’t availability, but accessibility.  📊 Global Crowdfunding Trends  A fresh report from The Business Research Company predicts that the global crowdfunding market will grow from $17.7 billion in 2024 to $20.5 billion in 2025. By 2029, the market is expected to reach $38.7 billion, effectively doubling in just five years.  *Crowdlending is one type of crowdfunding (where funds are invested, not donated), and it is becoming increasingly popular among businesses seeking alternative sources of capital.*  ❓ Crowdlending: Legal or Not?  When my colleagues and I started considering this option for additional financing, our first question was: how legal is it?  🔷 In Russia, the activity is regulated by the Central Bank.   🔷 In most European countries, regulation is less strict, but the European Regulation 2020/1503 sets the framework. The main goals of this regulation include:   🔹Investor protection (risk disclosure, transparency);   🔹A system of education and warnings;   🔹The ability for platforms to operate across the EU without borders.  This creates enormous opportunities for the market: any European investor can invest in any platform registered in the EU, and businesses can attract capital from across the Union.  🌍 International Platforms and Strategies  In Russia, the crowdfunding market has slowed due to the high key interest rate. However, Russian companies operating in different countries are actively raising capital through international platforms—especially microfinance organizations. For example, if you look at the list of borrowers on the largest platforms (Mintos, Peerberry, Esketit, etc.), you’ll find representatives from all over the world.  Some companies even create their own platforms to avoid paying commissions to intermediaries. Examples include:   🔹The Una Financial Group (brands Zaimer, Prestamer, Robocash) has been successfully attracting funds through its Robocash platform for years.   🔹According to TodoCrowdlending.com more than €1 billion has already been raised through this platform.  📈 What to Expect in 2025?  A recent Robocash report shows that investors expect a crowdlending return of 10.64% per year in euros. However, 26% of respondents predict a decline in returns due to a potential ECB rate cut.  The world is changing. Banks are becoming more cautious, but businesses still need capital to grow. Crowdlending has already proven its effectiveness in Europe, and its influence will only continue to expand. In the near future, this financing model may become the primary option for businesses, especially those operating in international markets.

🖋️ NPL Portfolio Sales to Surge by 44%: What Awaits Spain's Debt Market in 2025? Prime Yield - Valuation & Advisory part of Gloval, an asset and mortgage loan valuation company for investment funds and banks, has published a new report on the non-performing loan (NPL) market. The report analyzes sector dynamics and forecasts for the coming months.  According to data from the European Banking Authority (EBA), the volume of non-performing loans in Spain amounted to €76.2 billion at the end of Q2 2024. This is 2.6% lower than in the previous quarter, breaking a four-quarter growth streak.  📊 Delinquency Trends  The distribution of NPLs in Spain highlights differences between households and non-financial corporations (NFCs):   🔹 Households account for 61% (€46.2 billion), marking a 2.7% increase from a year ago.   🔹 Mortgage loans make up half of household debt (€21.9 billion), up 0.9% year-over-year but down 3.1% from the previous quarter.  Spain diverges from the broader European trend of rising NPLs but remains the second-largest country in terms of NPL share in total portfolios (20%), trailing only France (32%). A year ago, Spain’s share stood at 21%.  The delinquency rate in Q2 2024 remained at 2.8%, exceeding the European average of 1.9%.  💬 Expert Insight  According to Francisco Virgolino, Managing Director of Prime Yield, the recent rise in overdue payments has not led to a significant increase in NPL transactions in Europe. Instead, the inflow of new non-performing loans surpasses their resolution. However, banks are better prepared to handle such stress thanks to effective commercial and regulatory policies.  The expert also noted that the reduced volume of NPL transactions has prompted investors and servicers to reassess their business models, adapting to the evolving market. With fewer large-scale deals, scale has become a key factor for consolidation, leading to increased corporate operations among servicers and secondary market transactions.  ✅ NPL Portfolio Sales Forecast for 2025  Prime Yield estimates that NPL portfolio sales will reach approximately €22.3 billion this year, a 44% increase from 2023, marking the highest level since 2019.  Natural Disasters, Loans, and Tariffs: Three Potential Threats to Spain’s NPL Market  According to Javier Rodríguez Fernández, Director of the Casas Finanzas office in Madrid, Spain may see a slight increase in non-performing loans in 2025. The key reasons include:   🔹 Geopolitical instability affecting industries and regions engaged in international trade. Andalusia, Catalonia, and Murcia are at risk due to potential U.S. tariffs on agricultural products.   🔹 The aftermath of flooding in Valencia (late 2024), impacting real estate, transportation, and infrastructure.   🔹 The rise in consumer and retail lending, which carries a higher risk than secured loans.  Additionally, NPL portfolio sales may see a modest increase of 10-15% from 2023 levels.

🖋️ New Law to Reshape the Non-Performing Loans (NPL) Market. In January 2025, Spain passed Organic Law 1/2025, which mandates mediation and Alternative Dispute Resolution (ADR) methods before taking legal action. The aim of this reform is to reduce court congestion and encourage out-of-court settlements.  The law will come into effect on April 3, 2025, and will significantly impact the non-performing loan (NPL) market.  ⚡️ What will change?  🔹 Mandatory mediation before litigation – Creditors must first attempt to resolve the debt issue out of court.   🔹 Slower debt collection processes – Additional out-of-court procedures will extend the timeline.   🔹 Lower legal expenses – If mediation is successful, litigation costs will be reduced.   🔹 Adaptation of collection strategies – Creditors will need to actively engage in negotiations and offer alternative solutions.   🔹 More restructuring options for debtors – Borrowers will have better chances for restructuring, payment deferrals, or partial debt forgiveness.  💲 How will the law affect NPL pricing?  🔹Lower liquidity of distressed assets – Mandatory mediation will slow down recovery, making NPLs less attractive to investors.   🔹Higher operational costs for creditors – Banks and debt collectors will spend more on negotiations and legal support.   🔹Longer debt recovery timelines – The extended collection process will reduce the present value of NPLs.   🔹More debtor-friendly conditions – Easier access to deferrals and restructuring will decrease overall debt recovery amounts.   🔹Investors may demand deeper discounts on NPLs – Lower demand could push market prices down.  ❓ What’s next?  No one can predict exactly how debt collection will evolve under the new rules. Market participants will need to adapt. Initially, NPL prices are expected to decline due to uncertainty and slower recovery processes. However, as stakeholders become familiar with the new mechanisms, efficiency will improve, and prices may stabilize.  Overall, this law is a positive development for the market: it reduces the burden on courts, improves the business climate, and aligns Spain with European standards for alternative dispute resolution.

🚘 Not everyone knows that Spain is one of the world's largest car manufacturers, ranking 8th in the world. In Europe, only Germany produces more cars. However, ironically, the best selling car in Spain, the Dacia Sandero, is assembled in Romania and Morocco. Second place in sales went to the Toyota Corolla, and third place went to Spain's Seat Ibiza. The top 10 also included Toyota C-HR and Yaris Cross, Korean Hyundai Tucson and Kia Sportage, another Spanish Seat Arona, Chinese MG ZS and Renault Clio. Everyone likes to save money, and the Spanish are no exception. If we look at sales by brand, Toyota leads by a wide margin (95,600 cars sold), followed by Volkswagen (66,900 units) and Seat (65,300 units). The more prestigious German brands Mercedes and BMW occupy 9th and 10th places (47,000 and 45,200 units respectively). ❓ What about Chinese cars? They are rapidly gaining popularity. For the first time a Chinese model made it into the top 10 sales - it is MG ZS. Among the brands BYD and Omoda showed record growth: +758% and +4400% respectively. Sales of Tesla and other government-subsidized electric cars are also growing rapidly. Anyone buying an electric car can get a discount of up to 9,000 euros (depending on the model). And if the owner is disabled, lives in a small municipality (up to 5,000 inhabitants) or works as a cab driver, the amount of support increases by another 10%. 📈 The average price of new cars for sale in Spain has increased by 38.7% over the last 5 years and now stands at 52,237 euros, whereas previously it was 38,385 euros. As a consequence, while in 2014 only 36% of cars were purchased with a loan or other form of financing, in 2024 it is already 75%. The Bank of Spain does not identify car loans as a separate category, but in general for loans for car purchases, trips, gifts or unexpected expenses, the default rate at the end of 2024 has reached 7%. The total volume of overdue loans in this category is steadily increasing and has already exceeded €3 billion. ☑️ Where there is credit, there are overdue debts, and hence the NPL (Non-Performing Loans) market we work with. This is why we love finance: it is everywhere.

🖋️ How to calculate the yield of a debt portfolio? Investing in debt portfolios is a complex but interesting instrument. To objectively predict the total return on a certain date, it is important to consider not only the amounts collected, but also the current value of the portfolio, which decreases over time. 📊 Example of total return calculation Our first portfolio was purchased in September 2022 for €16,306. During this time we managed to collect €26,667, but of this €5,610 went as a commission to the agency. On this basis the net income is: ➡️ 26,667 - 16,306 - 5,610 = €4,761 ➡️ ROI = 29.2% (or 12% per annum). But this is not the whole picture. To get the total return, you need to consider: 🔹 Future foreclosure proceeds. 🔹 Possible secondary sale proceeds. Over time, the value of the portfolio declines due to the reduction in total debt (since some of the debt has already been collected) and the obsolescence of the remaining debt.  Let's go back to our first portfolio. Its market value is now 2.3% of the original debt (€117,446), i.e. €2,723. The portfolio was originally bought for 14.24% of the debt, which means its value has decreased 6 times in 2.5 years. If we add the estimated value of the portfolio (€2,723) to the current net income (€4,761), we get a total operating income of €7,484, where: ➡️ ROI = 45.9% ➡️ Operating yield = 19% p.a. (if we realize the portfolio on the secondary market at the estimated price) The difference is clear: 12% p.a. excluding the sale vs. 19%. ✅ Factors affecting the total return 🔹 Purchase price - the lower the better. 🔹 Efficiency of collection - speed and volume of returns. 🔹 Costs of foreclosure - agency and lawyer fees. 🔹 Value of the portfolio on the secondary market - depends on the age of the debt and market conditions. While we cannot control the resale value, we can influence the purchase price, recovery efficiency, and collection costs.  💡 I wonder what fate awaits this portfolio? And do you think our calculations will come true, or will the actual returns come as a pleasant surprise? Share your opinions in the comments!

🖋️ The first month of the year — the first net operating profit! January became a milestone month – for the first time, all income from debt portfolio recoveries turned into net operating profit. This was made possible due to the full recoupment of investments by the end of December. As of February 1, the return on investment (ROI) for all five portfolios, excluding recovery costs, was 31.91%. The ROI (including all expenses) reached 6.11%. 📊 Return on investment by each portfolio: 🔹 First portfolio: ROI 29.20% over 29 months (~12% per year) 🔹 Second portfolio: ROI 54.93% over 28 months (~23.5% per year) 🔹 Third portfolio: ROI 14.41% over 27 months (~6.4% per year) 🔹 Fourth and fifth portfolios: still not reaching operating profit, but already recouped excluding recovery costs (7.53% and 7.96% respectively, ROI: -11.64 and -12.34). 💡 Why is it important to consider total return? To correctly assess total profit, it’s necessary to add the following to the current net profit from each portfolio: 1️⃣ Net profit from future recoveries: this can significantly improve the figures. 2️⃣ Potential income from selling the portfolio on the secondary market: this is particularly important with a typical 3-year portfolio lifecycle. The overall profit and ROI of the project will substantially increase when considering these factors. In one of the next posts, we’ll discuss how considering income from selling a portfolio affects the total return, using one of the portfolios as an example.

🖋️ Kicking Off 2025: An Inspiring Start with Unexpected Challenges. The New Year holidays can throw anyone off track, especially in sunny Spain, where celebrations come one after another. But not us! While some were still recovering from the festive season, our Madrid office, led by Javier, was already hard at work, setting the pace for the new year. And although we faced a few unexpected challenges, the year is off to a strong start!  ✅ A Great Start  By the end of January, we had launched two auctions:  ➖ Lot #1: A secondary debt of €5.7 million. Its starting price was just €180,000, making it an attractive offer for market participants.   ➖ Lot #2: A primary debt from one of Spain’s largest MFIs, totaling €20 million, with a starting price of €680,000. This lot caused a real stir: more than 20 buyers downloaded detailed information and prepared for active bidding.  ⚠️ Unexpected Hiccups  For one of the lots, bids came in right from the start of the auction, while for the other, potential buyers chose to wait until the final minutes. Normally, this isn't a problem since the platform automatically extends the auction time after each bid.  But this time, technology decided to surprise us. For the first time in five years, the platform experienced a minor glitch. Our technical specialists quickly resolved the issue, and managers promptly contacted buyers to inform them about the auction extension. In the end, the lot was sold — partly offline, thanks to good old-fashioned phone calls.  📆 February Plans  We're keeping up the momentum! Two new auctions are scheduled for the first ten days of February:  ➖ A portfolio from one of our regular sellers.   ➖ A lot from a new company — an MFI that recently entered the Spanish market. It's another international company with Eastern European capital.  It looks like we've handled things quite well! It feels great to kick off the new year with a productive start and successful deals.

🖋️ Who are the richest people in the world? When it comes to the richest people on the planet, the first people who come to mind are Ilona Musk, Jeff Bezos and Bill Gates. But there are asset owners in the world who are much richer, and their wealth does not depend on the value of individual companies. These are sovereign wealth funds and pension funds - the real giants in wealth management. 📊 Top richest funds in the world At the end of 2024, the leader among the richest funds is the State Investment Pension Fund of Japan with total assets of $1.59 trillion. In second place is the Sovereign Fund of Norway - its assets are estimated at $1.54 trillion, and in third place is the China Investment Fund with assets of $1.24 trillion. In addition to these leaders, the list of the largest includes funds from countries such as: 🔹 UAE 🔹 Kuwait 🔹 South Korea 🔹 USA 🔹 Singapore 🔹 Saudi Arabia. Surprisingly, the largest U.S. fund, the Federal Retirement Savings Fund, ranks only 8th. Its assets are almost half the size of Japan's. The reason is that American assets are distributed among many funds: the top 100 largest funds in the world include 41 American funds, while no other country is represented by more than 8. ✅ Investment strategies of the largest funds The world's largest sovereign wealth and pension funds take a diversified approach to investing. Their assets are allocated in roughly three equal parts: 🔹 Equities - investments in companies around the world. 🔹 Bonds - more stable and conservative instruments. 🔹 Alternative investments - hedge funds, real estate, funds of funds, and real assets. Diversification by asset type, geography and time is the basis of their strategy. This significantly reduces the risk of capital loss, which is a key objective for such funds. ❓ Why is diversification important? History shows that the capitalization of even the largest companies can collapse in a matter of days. For example, just yesterday, Nvidia's capitalization fell by more than $600 billion, and at the end of 2021, Ilon Musk's fortune fell by $200 billion in just a few weeks. However, we don't hear such dramatic news about sovereign wealth funds and pension funds. Their success is built on a sound diversification strategy that protects capital from sudden fluctuations. 💲 What does this mean for private investors? If your goal is reliable capital appreciation, without sudden jumps and significant risks, take the example of the world's largest funds. Basic principles: 🔹 Asset classes: allocate capital between stocks, bonds, real estate and alternative investments. 🔹 Geography: invest in different countries and regions. 🔹 Timing: plan investments for the long term and choose the right time to enter and exit. The history of the world's largest asset owners confirms that proper diversification is the key to stable and long-term financial success.

🖋️ What's New at the World Economic Forum? Key Risks and Trends for 2025/ This week, Davos once again became the epicenter of discussions on global challenges, as the annual World Economic Forum (WEF) takes place. However, WEF is not just about offline discussions but also significant research publications. Last week, two key reports were released: the *Global Risks Report 2025* and the *Chief Economists Outlook*.  ⚡️ What Risks Can We Expect in 2025?  Experts have identified factors that are most likely to trigger global-scale crises:  ➖ Armed conflict between states — 25%   ➖ Extreme weather events — 14%   ➖ Geoeconomic confrontation — 8%   ➖ Misinformation — 7%   ➖ Social polarization — 6%   ➖ Economic downturn — 5%  Interestingly, economic risks (such as geoeconomic confrontations and downturns) are not at the forefront. In fact, they don’t even make the *Top 10*. Natural and geopolitical factors, however, remain central concerns for over a decade, including climate change, depletion of natural resources, and environmental pollution.  ❓ What Does This Mean for Investors?  Experts often overestimate external threats that dominate the media narrative. However, private investors should remember: the likelihood of these risks significantly affecting your assets is low. The key is not to panic and to carefully analyze actual economic indicators.  ✅ Economic Outlook for 2025  According to the *Chief Economists Outlook*, we can expect inflation to slow down, but also a weakening of the global economy. The global economic landscape is becoming increasingly fragmented:  ➖ 94% of experts believe this will impact trade in goods.   ➖ Labor mobility and the transfer of technology and data will also suffer.   ➖ The financial sector, on the other hand, is less exposed to the risks of deglobalization.  Stay focused on your long-term goals. Separate real factors from the emotional noise of the news. And, of course, keep analyzing data and insights to stay informed about global trends.

🖋️ Investments in Debt Portfolios: Reaching Net Profitability. December marked a significant achievement for us. Analyzing November’s results, we initially projected reaching net profitability on our debt portfolio investments only in January. However, the actual outcomes pleasantly surprised us — we achieved this milestone slightly earlier.  📊 Figures That Speak for Themselves  🔹 ROI across all five portfolios, excluding recovery costs, reached 27.38%.   🔹 Including recovery costs, we entered positive territory for the first time at 2.43%.  The performance of individual portfolios is particularly encouraging:  🔹 The last two portfolios broke even (excluding recovery costs) within 1.5 years and are expected to generate net profits by the end of the second year.   🔹 The first three portfolios are already generating net profits, with ROI figures of 25.35%, 53.51%, and 11.94%.  It has been 2 years and 3 months since investments in the first two portfolios, and 2 years and 2 months for the third.  ✅ A Revised Development Strategy  We are pleased with these financial results and see great potential in this area. However, to achieve new heights, we have decided to revise our investment attraction strategy. Previously, we focused on investments ranging from €10,000 to €100,000. Now, we plan to concentrate on attracting large-scale investors from Europe, the CIS, and other regions.  Our goal is to increase the portfolio volume by €5 million in the medium term. This step will significantly reduce the impact of fixed costs on profitability and ensure stable overall financial results for further growth.