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FAQ about Russian and Ukrainian lending companies on Mintos

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136 comments

  • Official comment
    Annija (Mintos)
    Community manager

    April 14, 2022

    On the 14th of April, we had In Recovery Ask Me anything session.

    Please see the specific part here, where the situation of Lending Companies from Russia is explained in detail: https://youtu.be/Mn0LOZKQr-8?t=670

    March 25, 2022

    Overview: the exclusion of Russia from the international economy

    We are working on a detailed insight for investors about the structure of repayment processes from the lending companies from Russia and about the possible outlooks for recovery of funds related to investments in loans from this market. But first, we want to start with a general overview of how sanctions for Russia and the country’s response impact currents of international financial markets. The effects are extending to anyone with exposure in Russia, from the largest banks and investment funds to companies like Mintos.

    We welcome you to share your comments and questions in the Mintos Community, and we will try to include them in the upcoming article, or answer them in the Community.

    The full overview can be found here: OVERVIEW

     

    Update of the 11 March 2022 can be found here: UPDATE , please also find Ask Me Anything Sessions Recap: Recap: AMA

    Update of the 4 and 8 March 2022 can be found here: UPDATE 

    Update of the 1 and 2 March 2022 can be found here: UPDATE 

    February 28, 2022

    Russia-Ukraine war impact update: SWIFT ban, RUB plunge, pausing listing new loans from Belarus, and more

    Below, we are sharing more information about the most recent developments and their impact on Mintos investors.

    Full information can be found on our Blog post:

    https://www.mintos.com/blog/russia-ukraine-war-impact-update-swift-ban-rub-plunge-pausing-listing-new-loans-from-belarus-and-more/ 

    • Impact on banning Russian banks from SWIFT

    It has been agreed to exclude a number of Russian banks from the SWIFT system, however, details about which exactly Russian banks will be affected by this decision, or what will be considered as a breach of sanctions are still unknown. Together with lending companies we have identified a few different routes that Russian lending companies could use as alternatives to SWIFT (e.g. China’s alternative solution, other non-EU banks). 

    • Most recent status of borrower repayments

    It’s important to mention that as of today, we have not experienced any interruptions in transfers of borrower repayments to Mintos by Russian lending companies. Lending companies have reduced issuance volumes, and they’re closely monitoring borrowers’ repayment discipline. The only lending company on Mintos from Ukraine is obviously influenced by the state of emergency and martial law in the country. We will continue to be in close contact with lending companies from Russia and Ukraine and share important updates on our blog.

    • Russian rouble plunges

    The Russian rouble dived significantly against other currencies on Monday morning in an all-time low as markets assessed the impact of sanctions on Russia.

    For now, we can’t predict to what extent lending companies will be affected by this. Several of the lending companies from Russia have full or partial currency hedging in place, but the current situation might be subject to the force majeure clause and maturity matching of used hedging instruments. This might lead to difficulties for lending companies to cover for currency risk.

    • We are stopping listing loans from Belarus

    As of 28 February, we’re limiting exposure to loans from Belarus to protect investors from potential risks in the light of recent developments:

    We’re excluding loans from Belarus from the Primary Market and pausing placement of new loans from Belarus on the Mintos platform until further notice.
    Existing loans from Belarus will remain in Mintos Strategies, so it will be possible to cash out these loans. 
    Mintos Secondary Market will remain open for loans from Belarus.

    • RUB currency exchange and withdrawals affected

    We paused the currency exchange for RUB over the past weekend. After RUB has plunged around 30% on Monday morning, the RUB exchange function on Mintos remains unavailable, as the service provider Mintos uses for this function has paused the service due to unprecedented external factors in the financial markets (e.g. closed Moscow stock exchange).

    Please note that at the moment, you might not be able to withdraw RUB from your Mintos investor account, or exchange RUB to EUR. In the upcoming days, we will make the exchange from RUB to EUR on investors’ behalf, for all who have available funds in RUB. Due to sanctions for Russia, the EU banks can’t hold RUB anymore and are finding the best ways to manage this.

    • KZT exchange rate under close monitoring

    The financial turmoil has had an impact also on the position of KZT and its exchange rate in servicer banks. As a result, currency exchange involving KZT might be interrupted. We will manage the situation in real-time, based on status in the markets and the availability of our exchange service provider.

    February 25, 2022

    Update about how we will approach RUB exchange and withdrawals

    After our first reaction and pause of the RUB exchange activity to limit the currency risk, we decided to re-enable exchange, but in limited time periods. We will monitor RUB in real-time, and we will be enabling access to currency exchange during the working days while being cautious about fluctuations in the currency’s value.

    For better control, we will be closing positions at the end of the working day to prevent the risk of negative exposure. Based on the assessment of the RUB standings, we will be opening currency exchange possibilities in the mornings. The exchange will be closed over the weekend.

    Please note that you can not withdraw RUB from your Mintos investor account when the original investment was made by conversion of EUR to RUB. To withdraw the RUB balance, you need to convert it to EUR. It's possible to withdraw RUB to the bank accounts which accept this currency.

    We will inform you in case of any new changes.

     

    February 24, 2022

    Update: We’re limiting exposure to loans from Russia and Ukraine

    On 24 February 2022, the Russia-Ukraine crisis turned into a Russian invasion of Ukraine. Ukraine has imposed martial law in the country, while this new development resonates across international financial markets. At the moment, we are observing a further growing risk of sanctions that might impact settlement transfers from these markets, and a currency risk that is already materializing, without predictable outcomes in the upcoming period.

    To protect our investors from the heightened market and currency risk, we are:

    • Excluding all loans from Russia and Ukraine from the Mintos Primary Market
    • Removing all companies that issue loans in Russia and Ukraine from the Mintos strategies
    • Pausing placement of new loans from Russia and Ukraine on the Mintos platform until the need to reassess the decision emerges
    • Pausing currency exchange to and from RUB, for all currencies

    Please note that:

    • Mintos Secondary Market will remain open for investors’ activity with loans from Russia and Ukraine
    • Once loans from these companies are removed from the Mintos strategies as a measure of protection for investors, investments in loans by these companies will not be available for the standard cashout. With a temporary removal of Russian and Ukrainian companies from the Mintos strategies, existing investments in these loans will be shown as “unavailable for cashout”. Still, liquidity is possible by selling these loans on the Mintos Secondary Market until further notice
    • Currency exchange to and from RUB will be temporarily unavailable, and applicable exchange fees may be influenced by market dynamics relating to exchange rates for RUB.

    Full Blog Post can be found here https://www.mintos.com/blog/update-were-limiting-exposure-to-loans-from-russia-and-ukraine/

     

     

     

     

  • JARMO VILLE VIIKKI

    If EU puts sanctions against Russia (and Russia puts counter sanctions against EU), what measures Mintos takes to protect the investors as you are supposed to protect the investors as a regulated company?

    0
  • ALEXANDER GROSS

    I am invested in Russian Credits and would like to know what sanctions would cause that Credits can no longer be payed back? I could not believe that there are sanctions that no longer allow Russian Compsnies to pay back Credits?
    And here my second question:
    I think The Swift Sanction is the worst but I am not sure what that would mean to the repayment of my Credits. Can you tell me?
    I think this sanction will come 90% and I would be glad if Mintos looks for preventing Meassures together with Kviku and the other Russian Companies. It must be posdible for these Countried to transfer monex by other Services like PayPal, western Union...
    Thsmks for your answers

    1
  • JARMO VILLE VIIKKI

    Yes they have stated clearly the swift is not on the table. However, Russia is preparing already by allowing bitcoin (they supposedly banned it a couple months ago and now lifted the ban probably because of these sanctions that they are expecting). 

    I hope SWIFT will not come to the table later though.

    This is more information and economic war rather than actual war it seems (Ukraine is pretty peaceful place still but USA can eventually cause/agitate a war there).

    0
  • ALEXANDER GROSS

    Bitcoin - a really good idea (I hatr wat but I wynt my money back which has nothing to do with Putin). But will Mintos accept that e.g. Kviku repays the money with Bitcoins

    0
  • JARMO VILLE VIIKKI

    The beauty of bitcoin is that if you get bitcoins, it might actually appreciate enough to cover your credit losses. Like if Wowwo would repay in bitcoins, I would accept it even at some hair cut. Bitcoins you just wait until the price is right and then you sell it (unless you decide to hold it "forever").

    0
  • ALEXANDER GROSS

    I would also accept Bitcoins. But I am not sure if Mintos will accept it.

    At the moment, I think the money will be repayed until The Swift Ssnction will come. And I hope this Sanction is the very last step...

    0
  • João Neves

    Annija (Mintos) thank you for the update.

    I appreciate these measures taken to protect investors. I do believe that Mintos is being too much reactive and not enough pro-active when it comes to protecting investors.

    The removal of Russian LOs from the Conservative strategy should've been done before Russia recognized the independence of the Donbas region and the suspension of the Russian LOs from the primary market should've been done at least when Russia declared independence of the Donbas region.
    Ideally both of these actions would've been taken even earlier than that.

    Loans take time to mature, if action is taken too late, investors are not protected at all.

    1
  • JARMO VILLE VIIKKI

    I agree with you.

    Also, what alternative measures Mintos provides for LO to proceed the repayments to Mintos in case of sanctions being on the extreme at some point of time?

    What are the protection measures to keep up with the repayment disciplineship of LOs during the crisis (we do not want the management just to quit API and repayments)?

    I think it is time to add bitcoin now option now, and those who wish turn their bitcoins into euros, it would be easy for Mintos to find a partner that does that transaction. However, I would personally hold those bitcoins so the option to hold (the only currency I feel comfortable to hold over longer time) should be also available there.

    0
  • MARIN RUMENOV YORDANOV

    Dear Annija,
    excuse me for the rude language, but your company is a some kind of a joke.
    If you were a real investors company / platform, you would really protect your customers, not tell them after a storm that Mintos team "provides" them hats ... like it was with Wowwo, the Russian-Ukrainian crisis and so...

    -2
  • Grzegorz Kurc

    Hello Mintos. Should I consider the funds invested in loans from Russian companies as lost? I don't quite understand why, in order to protect investors, their loans were marked as "unavailable for cashout". In that case, the Russian companies will only benefit from this?

    0
  • ALEXANDER GROSS

    What happens with Credits "unavailable for cashout"? I hope the lending comanies can still pay back my money?

    0
  • Petra Christina Zaagman

    What is Mintos' plan should Russia be cut off from Swift? Also, why can't I sell my loans on the secondary market? All are stuck 'processing'. Is the secondary market open or not?

    0
  • GERRIT HENDRIK WULFF

    The main problem I have is that these measures are not protecting me as an investor. I have some money invested in RUB, but now I cannot exchange my money back. The money is just stuck. There are no more Russian primary market loans to invest in either. Either let me invest my RUB, or allow me to cash out. The current situation is not protecting me in any way, just hindering me.

    0
  • Miki

    I must agree with Gerrit, yesterday the RUB was out of control, so I can understand a temporary shutdown of its exchange, but how long will this last ?  I am sure there are many investors that would like to get rid of rubles.

    On another note, how about considering also banning new loans from Belarus on the primary market ?

    I certainly wouldn't invest in them anymore.

    0
  • JARMO VILLE VIIKKI

    I have even better idea: Let us ban all the loans from every country.

    Seriously, Mintos is basically protecting the new comers, not the ones who are already invested. There is nothing that protects those investments that are already been made.

    That is also important investor protection which Mintos as a regulated financial institution is expected to do. 

    2
  • Anna (Mintos)

    Miki GERRIT HENDRIK WULFF about RUB currency exchange please see our update on the top of the page.

    0
  • Petra Christina Zaagman

    With SWIFT sanctions seeming more likely, what alternative means are there to ensure LOs can still make payments?

    1
  • ŁUKASZ JÓZEF AMBRYSZEWSKI

    @Mintos, I think you owe us information whether you already started working with Russian lending companies on a solution that will allow them to transfer money to Mintos in case SWIFT transfers are blocked for them. Look at the Secondary market, how panically loans are sold out there but no one wants to buy them. Actually, currently it's even not possible to sell a loan because system processes publishing it on the Secondary market endlessly. It puts my further cooperation with Mintos under question mark. Same as situation with Turkish lending companies. How even did you allow them to sell non-hedged currency loans via Mintos in current Turkish economic situation? It's ridiculous! Even me when buying currency loans I hedge them. If Minos had a small share in every loan, maybe then would be more cautious when assessing risk.

    2
  • GERRIT HENDRIK WULFF

    Anna (Mintos) Thank you for your fast reply and quick action.

    0
  • Onni

    Let's play assumptions. Let's assume that swift restrictions come into action and assume that it's the only problem. Lending companies continue to operate as usual. In this scenario:

    A) Are there mechanisms in place for transferring funds from lending companies to investors?

    B) Is there any reason to assume that anything else other than delays in payments would occur?

    2
  • ALEXANDER GROSS

    I am very sad but because you give us no information I wrote the lenfing vompsnies directly and they answered, that it is possible to use the Russian alternative instead to Swift if the swift sanction comes. Is that the truth?please tell us.

    If there is no reaction today I will stop all my automatic investment strstegies

    1
  • Petra Christina Zaagman

    Mintos, the question regarding SWIFT has now been raised by multiple investors and yet you don't even take the time to let us know you are looking into it and talking to Russian LOs. This option has been on the table for days now and we are now seeing certain Russian banks blocked from u sing SWIFT. Why is Mintos taking so long to respond or even communicate? This negligence is stripping Mintos of its credibility at a very rapid pace.

    1
  • PHILIPP GERNOT SCHNEIDER

    HI MINTOS!

    I trusted you. For the moment I still do. I have a large sum in my strategy which invests 90% in Russia (which you have chosen, I have not chosen Russia exclusively in the strategy). This sum is an important part of my retirement provision. I couldn't see this coming and didn't have it on the screen in time to pull it out. 

    Nevertheless, it is the task of MINTOS to clarify whether SWIFT and the situation have a strong impact on our funds. Are our funds at risk? Will they be frozen and made available again after the crisis has ended? Or are the banks that are sanctioned not affected by this?

    Please make a general statement. I have seen that Kviku, for example, is not a bank or one of the sanctioned major banks. 

    Please provide clarification so that some here can live in peace.

    THANKS!!!!!!!!!!!!!

    3
  • PHILIPP GERNOT SCHNEIDER

    Any reaction?

    1
  • ŁUKASZ JÓZEF AMBRYSZEWSKI

    Since Mintos doesn't respond to our queries, I contacted two Russian lending companies on my own. Once they reply, I will share the answers with you here.

    3
  • PHILIPP GERNOT SCHNEIDER

    Thanks 🙏

    0
  • Annija (Mintos)
    Community manager

    We're working on the new Mintos update following the most recent developments affecting Russian and Ukrainian lending companies on Mintos. The update is planned for today. 

    Thank you for your patience!

    0
  • Radim

    and mention also what's going on with KZT, which was also removed from currency conversions

    1
  • Annija (Mintos)
    Community manager

    Dear Investors, please see our latest update here https://www.mintos.com/blog/russia-ukraine-war-impact-update-swift-ban-rub-plunge-pausing-listing-new-loans-from-belarus-and-more/ 

    The following points are mentioned there:

    • Impact on banning Russian banks from SWIFT
    • Most recent status of borrower repayments
    • Russian rouble plunges
    • We are stopping listing loans from Belarus
    • RUB currency exchange and withdrawals affected
    • KZT exchange rate under close monitoring
    -1

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