Capital Markets Update – Week of March 8, 2021 (audio)

In an effort to provide even greater transparency around our offerings and our investment platform, the capital markets team provides weekly updates.

Listen below for Charlie’s most recent views on our short-term note program and the current private credit landscape from Percent’s perspective.

Please find the transcript for this video below.

Hi everyone, this is Charlie Lienau, a Managing Director on our Capital Markets team here at Percent. Thank you for tuning into this week’s audio update where we provide a recap of the market, and an update on our short term note programs for the week ending March 7th.  

Looking at the equity markets, U.S. stocks had a volatile session this last Friday as a rally in bond yields eased with a better-than-expected jobs report bringing optimism for a faster economic recovery. The Labor Department reported nonfarm payrolls increasing by 379,000 for the month with the unemployment rate coming in at 6.2%. Friday’s moves reversed a steep sell-off on Thursday and into Friday open triggered by Federal Reserve Chair Jerome Powell’s remarks on rising bond yields, as markets were underwhelmed by his dovish messaging and implications for the Fed’s asset purchase program. The Senate was also expected to approve the $1.9 trillion stimulus package and send it to the House for a vote during the week, but as of Friday, the relief plan approval had stalled in the Senate amid impasse over unemployment support.

For last week, the S&P 500 closed basically flat compared to the week open, with the DOW up 1.4% and the NASDAQ down 3.6% for the week. Switching to the fixed income side. The 10yr and 30yr treasuries finished at 1.56% and 2.28%, up eleven and five basis points wider than week open, respectively. For context, rates are higher, but they are not high. Ten-year rates did rise last week, and yet that simply brought them back to where they were about a year ago. 

For the following week, the market will be following closely developments on the stimulus package and key inflation reports with the consumer price index expected Wednesday and the producer price index, scheduled for Friday.

Looking at our market at Percent, we had net inflows on all 5 business days last week, and we continued to see new signs ups and funded accounts join Percent. Looking at our STNP, we closed and settled three transactions. 

  • First, we had ZIN1 2021-2, a rollover issuance for Zinobe for $1.24 million. This 2-month offering carried an APY of 12% representing a 25bps negative new issue premium versus their last offering on the platform. 
  • Secondly, we had EDG1 2021-2, with new partner Edge Capital. This is the second transaction on our STNP platform, was also a new 9-month offering which closed at $250,000, and carried an APY of 14.00%, a 50bps decrease from their inaugural note. 
  • And finally, on Friday, we had CHY1 2021-3, a rollover offering in our PercentPrime vertical, with a 30-month offering. This transaction closed at $1.64 million, representing more than 3x upsize from last offering, and carries a 12% APY. 

In other news, and after much feedback, we decided to also build our own signing service for our investing process. This feature now allows for a smooth and seamless transaction when you make an investment without ever leaving Percent. Document signing on Percent is available to all individual investors for all future rollovers and deals. All other investors (including institutions, trusts, and IRAs) will continue to verify through our partner, HelloSign, though we expect to release this feature for everyone in the coming weeks.

That is all for this week’s update. Thank you for tuning in and your continuous support; have a great week!

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Nothing in this video should be construed as an offer to sell securities or a solicitation of an offer to buy securities. All investment involves risk and the possibility of loss, including loss of principal, and neither past performance nor forward looking information is a guarantee of future results.

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