At present we are all experiencing a “Rabbit” in the Headlights” moment.
The “Knee jerk” reaction is to do nothing. However, I fundamentally believe that for P2B (Peer to Business) lenders, this decision will provide even more opportunities that we can take advantage of. In the short term, we expect interest rates to fall and the Bank of England is ready to re-start the quantitative easing program, designed to support the big banks. In this scenario, I believe that big bank lending to SMEs will tighten and we should be able to source even more high quality lending propositions.
With bond yields falling to practically zero or negative, our new asset class is going to be more attractive than ever.
It is unlikely that ‘Section 50 will be invoked before October 2016 and even then, may take up to 2 years for it to be implemented. In the meantime we will still be members of the Single Market and exporters will be helped by the weaker Pound. Life will carry on. For us it’s “business as usual” and we have a good pipeline of interesting and secure lending propositions in due diligence, so keep an eye out for them!