Friday October 6 2017, Daily News Digest

Funding Circle lending

News Comments Today’s main news: LendingClub completes second self-sponsored securitization. Pennsylvania AG sues Navient. Federal regulator clamps down on payday lending. Elevate supports rule on small dollar lending. RateSetter expected to profit next year. China’s pyramid schemes double in 2017. KBRA opens first European office. LendIt leadership changes. Today’s main analysis: Funding Circle’s October review. Today’s thought-provoking articles: Payday lending’s tough restrictions. Cordray’s […]

Funding Circle lending

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News Summary

United States

LendingClub Corp Completes Second Self-Sponsored Securitization (Financials Trend), Rated: AAA

LendingClub Corp (NYSE:LC), America’s leading web marketplace connecting investors and borrowers, has contributed to and sponsored its second securitization contract. The Consumer Loan Underlying Bond Credit Trust 2017-P1 released $323.1 million in prime notes supported by consumer loan assets enabled through the LendingClub platform. It marks as the sixth securitization sponsored or supported by company, and the fourth rated securitization of company facilitated loans overall.

This deal was backed by around $350 million of collateral and comprises $217.3 million of Class ‘A’ notes rated “A-(sf)”, $51 million of Class ‘B’ notes rated “BBB (sf)” and Class ‘C’ notes worth $54.7 million rated “BB (sf)”. All ratings were given by Kroll Bond Rating Agency, Inc.

Pa. attorney general files suit against student-loan company (Philly.com), Rated: AAA

The Pennsylvania Attorney General’s Office filed suit Thursday against Navient, the largest U.S. student-loan servicer, alleging widespread abuses and deceptive acts involving its administration of student loans.

The suit against Navient Corp. and its subsidiary Navient Solutions LLC, formerly a part of Sallie Mae, could affect hundreds of thousands of Pennsylvanians, Attorney General Josh Shapiro said, adding that the office is seeking restitution for all borrowers affected by the practices.

That includes anyone who received private student loans from Sallie Mae or who has had federal or private student loans serviced by Navient and has had problems with repayment.

The Wilmington-based company, which has a large servicing center in Wilkes-Barre, already is the subject of a federal lawsuit filed this year by the Consumer Financial Protection Bureau (CFPB). Washington state and Illinois also have sued the company.

Pennsylvania residents have filed 1,059 complaints against Navient with the CFPB as of September, the Attorney General’s Office said.

Online lender Earnest sells to Navient, in a disappointing deal for investors (TechCrunch), Rated: A

Earnest, a well-funded fintech startup with bold ambitions to create a modern financial institution, is selling to the student-loan company Navient for $155 million in cash.

The exit isn’t so great for Earnest’s investors. They’d plugged roughly $320 million in cash and debt into the company, which was initially centered around providing small loans to people based on their earning potential and evolved over time to provide personal loans to a broader base of customers, as well as lend money to coding academies, as it told TechCrunch in late 2015.

Fintech deal suggests everything old is new again (NASDAQ), Rated: A

Everything old is new again in finance. Navient, which services debt, is buying startup student-loan refinancer Earnest for less than half its 2015 valuation. Even then, it’ll eat into the new owner’s earnings and share buybacks. Worse, Navient faces a fresh lawsuit over dodgy practices.

The Pennsylvania attorney general’s office filed charges on Thursday that follow ones from the U.S. Consumer Financial Protection Bureau in January with Illinois and Washington. All allege that Navient in some way or other cheated borrowers paying for college, which the company denies.

Earnest’s $155 million price tag suggests most in the industry have downgraded their expectations about profitable growth.

Navient shares tumbled 12 percent, erasing market value more than three times the value of the acquisition.

Elevate Expresses Full Support for CFPB Small Dollar Lending Rule (BusinessWire), Rated: AAA

Ken Rees, CEO of Elevate Credit, Inc. (“Elevate”), a tech-enabled provider of innovative and responsible online credit solutions for non-prime consumers, issued the following statement in response to the final “small dollar lending” rule issued today by the Consumer Financial Protection Bureau (CFPB):

“We applaud the CFPB, and we fully support this rule. We believe this rule is good for consumers and for the business we have built to better serve them. The small dollar rule protects consumers from the cycle of debt inherent in payday loans, short-term auto title loans, and certain balloon payment loans, and it encourages the kind of innovation we’re doing in underwriting, pricing and product development. We are heartened that regulatory uncertainty has been lifted with today’s announcement. Our current view is that the rule requires minimal or no changes to our business.”

Federal Regulator Clamps Down on Payday Lending Industry (U.S. News), Rated: AAA

Payday and auto title lenders will have to adhere to stricter rules that could significantly curtail their business under rules finalized Thursday by a federal regulator. But the first nationwide regulation of the industry is still likely to face resistance from Congress.

The Consumer Financial Protection Bureau’s rules largely reflect what the agency proposed last year for an industry where the annual interest rate on a payday loan can be 300 percent or more. The cornerstone is that lenders must now determine before giving a loan whether a borrower can afford to repay it in full with interest within 30 days.

Because studies by the CFPB have found that about 60 percent of all loans are renewed at least once and that 22 percent of all loans are renewed at least seven times, this cap is likely to severely wound the industry’s business model. In California, the largest payday loan market, repeat borrowers made up 83 percent of the industry’s loan volume.

The CFPB estimated that loan volume in the payday lending industry could fall by 55 percent under the new rules.

Roughly 12 million people took out a payday loan in 2010, according to the Pew Charitable Trusts.

In addition to the “full payment test” and the limits on loan renewals, the CFPB rules would also restrict the number of times a payday lender can attempt to debit a borrowers’ account for the full amount without getting additional authorization.

This Government Agency Is Seriously Overstepping Its Bounds (Fortune), Rated: A

The Consumer Financial Protection Bureau (CFPB) has a mission: to protect consumers from unfair, deceptive, or abusive practices. According to a new national poll by the Cato Institute in collaboration with YouGov, protection from deceptive practices is just what the American public wants. Asked to prioritize regulatory goals, the majority of respondents put “protect consumers from fraud” front and center.

Unfortunately, the CFPB continually misses the mark, issuing rules that make splashy headlines but in practice do little to stop bad behavior. Its latest proposed rule, expected to become final soon, doesn’t target fraud itself. Instead, it goes after an entire industry and will significantly reduce consumers’ access to credit at the exact moments they need it most.

As the Cato poll finds, the majority of payday borrowers say they receive good information about rates and fees from their payday lenders.

Payday Lending Faces Tough New Restrictions by Consumer Agency (The New York Times), Rated: AAA

The operators of those stores make around $46 billion a year in loans, collecting $7 billion in fees. Some 12 million people, many of whom lack other access to credit, take out the short-term loans each year, researchers estimate.

Industry officials said on Thursday that they would file lawsuits to block the rules from taking effect in 2019 as scheduled.

Under the new rules, lenders would be allowed to make a single loan of up to $500 with few restrictions, but only to borrowers with no other outstanding payday loans.

A dropoff of that magnitude would push many small lending operations out of business, lenders have said. The $37,000 annual profit generated by the average storefront lender would become a $28,000 loss, according to an economic studypaid for by an industry trade association.

Prepared Remarks of CFPB Director Richard Cordray on the Payday Rule Press Call (ConsumerFinance.gov), Rated: AAA

After a long process of research, outreach, and review of over one million public comments, the Consumer Bureau today has issued a rule aimed at stopping debt traps on payday and auto title loans. The rule is guided by the basic principle of requiring lenders to determine upfront whether people can afford to repay their loans. These strong protections cover loans that require consumers to pay all or most of the debt at once, including payday loans, auto title loans, deposit advance products, and longer-term loans with large “balloon” payments. The new rule also curtails repeated attempts to debit checking accounts that rack up fees and make it harder for consumers to get out of debt. This provision applies to the same kinds of loans and to high-cost installment loans as well. These protections bring needed reform to a market where far too often lenders have succeeded by setting up borrowers to fail.

Loans like these are heavily marketed to financially vulnerable consumers. Though they offer cash-strapped consumers access to credit, the full-payment requirement can make these loans unaffordable.

More than four out of five payday loans are re-borrowed within a month, usually right when the loan is due or soon thereafter. In fact, about one-in-four initial payday loans are re-borrowed nine times or more, as consumers pay far more in fees than they borrowed in the first place. Just like payday loans, the vast majority of single-payment auto title loans are rolled over or re-borrowed on the day they come due or soon thereafter. And one-in-five borrowers end up having their car or truck seized by the lender because they cannot repay the debt.

Our research has shown that the business model for payday and auto title lenders is built on miring people in debt.

The new rule also addresses how lenders extract loan payments from consumers’ accounts. This part of the rule covers short-term loans, balloon loans, and high-cost longer-term loans where the lender has account access. After two straight unsuccessful attempts, the lender cannot debit the account again unless it gets a new authorization from the borrower. In addition, lenders must notify consumers in writing before attempting to debit an account at an irregular time or for an irregular amount.

The final rule issued today applies the underwriting requirements only to lenders of short-term and balloon-payment loans. This is a change from our proposal, which would have required underwriting for a wider swathe of longer-term loans. We want to take more time to consider how the longer-term market is evolving and the best ways to address practices that are currently of concern and others that may arise as the market responds to the reforms prompted by this new rule.

The Bureau has spent five years developing this rule.

Despite Ban on Payday Lending, Public Pensions Profit from Outlawed Loans (NBC New York), Rated: A

Short-term, high-interest debt known as payday loans are illegal inside New York borders. But that hasn’t stopped state and city retirement funds from investing more than $40 million in payday lenders that operate in other states.

The Finance Industry’s Complaint Against the Consumer Financial Protection Bureau (U.S. District Court, Northern District of Texas), Rated: A

Read the full complaint here.

Fifth Third Bancorp’s Greg Carmichael Discusses the Relationship Between FinTechs and Banks (The Clearing House), Rated: A

This environment presents challenges to introducing technologies, products, or services. If we have an issue, we can’t advance the products or services. A zero-tolerance regulatory environment puts constraints on products and services that we may like to get into the marketplace. For instance, small dollar lending has been problematic. As you know, Jim, small-dollar lending is a very important product for our customers. Many customers are regularly going out to payday lenders, title loans, and pawn shops to get short-term access to dollars.

When you look at the amount of capital you have to hold, and the underwriting requirements for a small business loan versus a larger loan, the cost is the same. It makes it more difficult to serve small businesses, and you see small business lending by banks being significantly reduced over what you saw pre-crisis.

This partnership has already helped us form relationships with companies like GreenSky, ApplePie Capital, Transactis, and AvidXchange. This has enabled Fifth Third to accelerate our innovation in those different areas, whether it is unsecured lending, small business franchise lending, or accounts payable automation.

Well, the interesting thing with FinTechs is that most of them need a bank as a partner to be successful.

GreenSky doesn’t exist, Lending Club doesn’t exist, OnDeck doesn’t exist without liquidity and the safe harbor banks provide for the asset. Partnerships between a bank and a FinTechs are a potential strong win for our customers and a win for our banking shareholders because we’re more efficient in how we deliver innovative products and services.

Our $30 billion community commitment focuses on supporting low- to moderate-income borrowers. $11 billion of our five-year commitment is dedicated to mortgage lending; $10 billion is for small business lending; and $9 billion is for community development lending and investments.

Balance Credit Expands to California Consumer Credit Market (BusinessWire), Rated: A

Balance Credit, a leading online lender whose analytics and technology-driven solutions have enabled nearly $100 million in credit access for underserved Americans, has expanded its personal loan offering to residents of California. The expansion will allow Balance to assist the estimated 26 percent of Californians who are currently underserved by mainstream banking products. With the launch in California, Balance has expanded its geographic coverage from 19% to 31% of US consumers.

With today’s news, California marks the 9th state where Balance Credit operates, including Delaware, Missouri, New Mexico, Ohio, South Carolina, Texas, Utah, and Wisconsin.

5 ways to buy a home with a low down payment (KHOU.com), Rated: B

In fact, the average down payment, according to the National Association of Realtors, has been 6 percent for the last three years.

What do you do if you don’t have 20% lying around?

SoFi. SoFi is new to the mortgage lending space, but it’s setting itself apart in a big way. It accepts borrowers with a 10 percent down payment, but they primarily target borrowers with higher FICO Scores — think 700+. On the bright side, they do not charge mortgage insurance. In fact, SoFi doesn’t charge any loan origination, application or broker commission fees.

Lawmakers Call Ex-Equifax CEO’s Testimony Insufficient (Law360), Rated: A

House lawmakers on Thursday sharply questioned the former chairman and chief executive of Equifax Inc. over a massive data breach that left more than 145 million Americans’ personal information exposed, raising questions about why he had appeared to testify as opposed to current executives.

Appearing in his fourth congressional hearing over a three-day span, former Equifax Chairman and CEO Richard Smith faced a flurry of questions over the details of the breach, including over curious stock trades by top company executives just before the breach was made….

Ex-Bookkeeper Stole $ 1.6M From NJ Co. Via PayPal (Law360), Rated: B

Pennsylvania federal prosecutors Thursday filed an indictment charging a Philadelphia man with using PayPal to embezzle $1.6 million from his former employer, a New Jersey company that sells products for the cellular phone industry.

Peter Goodchild, 54, who was a bookkeeper at the Florham Park, New Jersey-based QwikSource LLC, allegedly pilfered the funds over a 10-year period. He also faces charges of money laundering, aggravated identity theft and filing false income tax returns.

Barclays US tests personal finance tool (Banking Technology), Rated: B

Barclays US is dipping its toe into the financial health business, testing a personal financial management tool that aggregates all of a customer’s Barclays credit cards, personal loans and savings products – as well as accounts with other banks – in one place, reports Banking Technology‘s sister publication Paybefore.

This new service, My Personal Bank, which will be announced soon, is embedded in the bank’s credit card mobile app.

Allrise Financial moves into downtown Reno (Northern Nevada Business Weekly), Rated: B

Allrise Financial Group has leased 5,500 square feet at 200 S. Virginia Street in Reno.

Did the CEO of Hardwick Clothes Cut Ties With the NFL Over ‘Unpatriotic’ Protests? (Snopes), Rated: B

In September 2017, Tennessee businessman and CEO of Hardwick Clothes Allan Jones withdrew all NFL-related advertising for his companies, in response to “unpatriotic” national anthem protests.

Source: Snopes

On 26 September 2017, Jones, who also owns Buy Here Pay Here U.S.A. and U.S. Money Shops, posted a screenshot to his Facebook page showing an email instructing his ad-buyer to stop any commercials for his companies from being broadcast during NFL games.

United Kingdom

RateSetter will return to profit next year, says CEO (P2P Finance News), Rated: AAA

RATESETTER will return to profit next year, its chief executive and co-founder has said.

The peer-to-peer lender was profitable in the financial years ended 2014 and 2015, but has fallen into the red since then, as it has invested heavily into scaling up the business.

The ‘big three’ platform published a recording of a recent speech by Rhydian Lewis (pictured) on its website on Thursday, in which he underlined his belief that RateSetter is a “sustainable and profitable model”.

Your October Review – Insight and Analysis (Funding Circle), Rated: AAA

Last month Funding Circle investors, like you, lent over £100 million to UK businesses to help them grow and develop.

Source: Funding Circle

September industry news

Thanks to investors, last year over £1 billion was lent to 10,000 businesses through Funding Circle, helping to create 25,000 new jobs.

We recommend lending £2,000 or more, so you can lend to 100+ businesses, with no more than 1% going to each one.

Source: Funding Circle

From peer-to-peer to here: Three issues that Zopa must solve (AltFi), Rated: AAA

Zopa is the world’s original peer-to-peer lending platform and the biggest consumer-focused platform in the UK. It has also been closed to new investors for the better part of eight months. The reason is explicitly that it cannot find enough new borrowers. Demand for its loans among existing investors is more than sufficient to match demand on the other side of the marketplace. For this reason, Zopa‘s Innovative Finance ISA has largely been an exercise in tax efficiently wrapping money that it already had on the platform.

A more meaningful initiative in the platform’s ongoing plight to attract borrowers might be its latest partnership with Saffron Building Society. This, for the first time in Zopa’s 12 year history, brings it into branches. Its loans will now be made available to Saffron’s 90,000 customers in any of its 11 branches across Hertfordshire, Essex and Suffolk, as well as via the building society’s website. Applicants can expect a quote within minutes.

Zopa may well have a bright future, but in the short-term it seems to me that it has three core issues that it must iron out:

  • Finding new origination channels in order to open to new customers once more, capitalise on the IFISA opportunity and take advantage of the cost benefits of deposit funding.
  • Meaningfully speed up whatever is delaying loan sales on the platform.
  • Find a way to maintain an attractive risk-premium for its P2P investors.

LendInvest CEO Christian Faes Challenges Government to Back SME Builders: Game On (Crowdfund Insider), Rated: A

“There are five times fewer small scale developers today than in the last housebuilding boom and not a single one of today’s top ten housebuilders was created before 1990. There is a clear monopoly in the sector,” clarified LendInvest Co-Founder & CEO Christian Faes.

Online Lender Lendy Seeks IFISA Permission & Announces Repayment For Largest P2P Loan (Crowdfund Insider), Rated: A

UK-based peer-to-peer property platform Lendy is currently seeking permission to launch an innovative finance ISA (IFISA). This news comes just after the online lender announced its 2016 earnings and additional growth plans.

Meanwhile, Lendy also announced the repayment of its largest p2p loan. Bridge and Commercial reported that the loan, which was secured against former the Kentish Town Studios building in North London, has been repaid in full 21-days ahead of schedule and even returned a gross 12% per annum in interest.

Digital wealth manager Moneyfarm acquires tech behind fintech chatbot Ernest (TechCrunch), Rated: A

Moneyfarm, the U.K.-headquartered “digital wealth manager” has acquired the technology behind personal finance chatbot Ernest. Terms of the deal aren’t being disclosed, though I understand that, along with the tech, this is an acqui-hire of sorts, seeing London-based Ernest’s CTO Lorenzo Sicilia join Moneyfarm to oversee technology integration.

Starling Bank expands to offer business accounts (Banking Technology), Rated: A

Starling Bank, one of the first banking challengers to offer a mobile-only current account in the UK, is expanding into the business market.

The Starling for Business account will initially be for entrepreneurs, sole-traders, and small business owners. The aim is to offer “fast, secure, and flexible” ways of managing business finance from mobile.

Can a robot give financial advice? (Which?), Rated: B

New guidance setting out how artificial intelligence services can give streamlined financial advice has been published by the Financial Conduct Authority (FCA).

Some of the most popular include:

  • Nutmeg: an online service that suggests a diversified investment portfolio tailored to the personal information you provide. Nutmeg will continually rebalance your portfolio in line with your risk profile, unless you change your preferences.
  • BestInvest: a platform to manage your investments online, offering research and analysis tools. Further advice is provided via phone by advisers.
  • RPlan: a tool for DIY investors, with the choice to choose, track and review investments online.
  • Barclays Financial Personality Assessment: this tool helps you identify your attitude towards risk and your composure levels. Users can then work with an adviser to build a portfolio.

Robo-advice on mortgages

Aside from investing advice, online services are also helping people make another major financial decision – applying for a mortgage.

A handful of robo-advisers for mortgages are currently operating in the UK market – Trussle and Habito are both up and running, while MortgageGym was granted a license from the FCA earlier this year.

Saving by app

  • Chip is a smartphone app which analyses your spending patterns and automatically transfers your money into a savings account, based on what it thinks you can add afford to save. While its standard interest rate is 1% AER, users can earn up to 5% AER by referring friends to the app.
  • Plum operates in a similar way, analysing your transactions and recommending savings, though it communicates via Facebook Messenger.
  • Cleo analyses your spending and suggests improvements to help you save more, but it won’t move your money for you.

Where are the top 10 buy-to-let postcodes? (Bridging&Commercial), Rated: B

Luton has held off Colchester to remain top of the LendInvest buy-to-let index, while Manchester has broken into the top three amid increasingly stronger metrics in northern markets.

The top 10 buy-to-let postcodes

Source: Bridging & Commercial

The bottom 10 buy-to-let postcodes

Source: Bridging & Commercial
China

Pyramid scheme investigations in China double during 2017 (NASDAQ), Rated: AAA

The number of pyramid schemes investigated by Chinese police more than doubled in the first nine months of the year, with cases involving nearly 30 billion yuan ($4.5 billion), the official Xinhua News Agency said on Thursday.

Police investigated 5,983 schemes from January through September, an increase of 118 percent, with internet-based pyramid schemes on the rise, many involving virtual currencies, according to the report which cited the Ministry of Public Security.

European Union

Rating agency opens in Europe (Structured Credit Investor), Rated: AAA

KBRA has opened its first European office, located in Dublin, Ireland, and intends to expand into further jurisdictions (SCI passim). Several new hires and some existing staff will support the European effort, which will have a concerted focus on infrastructure and aviation securitisation, along with traditional core business areas.

MyBucks Named ‘Best Financial Inclusion Company’ at European FinTech Awards 2017 (Next Billion), Rated: B

Luxembourg-based and Frankfurt-listed fintech, MyBucks S.A., was announced as the winner of the Award for ‘Best European Financial Inclusion Company’ at the European Fintech Awards 2017 taking place in Brussels, Belgium.

International

Leadership Changes at LendIt (Lend Academy), Rated: AAA

LendIt events today look and feel very different from our early events. Along with that LendIt as an organization has grown and matured. Last month we made some internal changes that I want to share with you here.

My partner Jason Jones, who has been the driving force in the growth of our business, took over the CEO role some time ago as the business became more complex.

As of early September, Jason has transitioned out of the CEO role and is now Co-Chairman along with me. This allows him to focus his entrepreneurial drive on areas of our business where he can make the most impact. He is turning his attention to become more client focused as major global financial services and technology companies become more involved in our business.

Bo Brustkern, who has until recently stayed in the background, is now taking on the mantle of CEO of LendIt.

Similarly, we have promoted Joy Schwartz, our longtime head of operations, to become President of LendIt.

Finastra, R3 and seven banks have blockchain plan (Banking Technology), Rated: A

FinastraR3 and seven banks – including BNP ParibasBNY MellonHSBCING and State Street – are working together to create a blockchain-fuelled online marketplace for the syndicated loan market.

Underpinned by Corda, R3’s distributed ledger technology (DLT) based platform, Fusion LenderComm exposes real-time credit agreement, accrual balances, position information and transaction data to lenders, from agent bank loan servicing platforms such as Finastra’s Fusion Banking Loan IQ.

How Prodigy Finance Helped Fund My MBA At London Business School (Business Because), Rated: A

Determined to boost her business skills and gain more international exposure, Argentinian Amelia Martinez decided to pursue an MBA at London Business School (LBS).

Coming from a developing country with high levels of inflation and currency fluctuations, she faced many hurdles funding her MBA, particularly when new government restrictions were imposed preventing her from taking money out of her country to pay for the last instalment of her tuition.

With a Prodigy Finance loan however, she was able to pay for and complete her degree. Having completed her MBA at LBS, she’s since gone on to work for the company that helped her do it.

Banks team up with IBM in trade finance blockchain (Financial Times), Rated: B

A group of banks are teaming up with IBM to build a new global system for trade finance using blockchain technology that is designed to track goods and automatically release payments as they move around the world by plane, ship or truck.

Bank of Montreal, Caixabank, Erste Bank and Commerzbank are joining the project called Batavia, which was launched by UBS and IBM last year and aims to start testing the technology using real transactions by early next year.

Australia

Millennial Money: We’re not willing to pay to keep our finances in check (Stuff), Rated: A

A 2014 survey by global investment banking company UBS found millennials preferred to seek advice from their friends rather than a professional.

Most millennials, like older generations, first looked to a spouse or partner for financial advice. Their next choice is their parents, followed by friends and other family members.

Non-millennials were much bigger champions of financial advisors: 40 per cent of non-millennial respondents reported seeking advice from one as their first port of call on a financial decision, while only 14 per cent of millennials said the same.

Source: Stuff

Blockchain Driven P2P Lending & Investment Platform Announces Crowdsale (Coin Idol), Rated: B

The crowdsale for the platforms ‘LoanBit Token (LBT)’ is scheduled to go live in November, with a presale beginning on 4th October 2017, and ending on 15th October 2017.

The ICO for LoanBit is set to go live on in November and will be open for only 31 days.

LoanBit – Legit Bitcoin Lending Interest Rates & Earning Platform? (Bitcoin Exchange), Rated: A

LoanBit is a lending platform created by an Australian startup called LoanBit Proprietary Limited. The platform is designed to work as a mediator between bitcoin lenders and businesses looking for short-term loans in bitcoin.

LoanBit promises to offer you a guaranteed daily interest rate of 2% to 5%, which adds up to triple or quadruple digit guaranteed returns per year. You can invest in LoanBit for as little as 0.01 BTC.

LoanBit claims to be a legitimately registered Australian company. The company lists an address in Canberra (17/7-17 Bunda St). They also have an Australian company number (610 418 794).

In any case, the LoanBit.net website was registered on February 16, 2017. The latest version of the website, which features the HYIP scam, only appeared online on September 10, 2017 – so it’s brand new.

Yes, LoanBit appears to be a scam, based on all of the information we can find online today.

India

P2P lending norms will bring order to industry, but speed bumps ahead (VC Circle), Rated: AAA

India’s P2P lending market, which is predicted to be worth $4-5 billion by 2023 according to community loan exchange platform Faircent, has several players operating in the space, such as LenDenClub, Monexo, BillionLoans, i-Lend, LoanMeet, i2iFunding and FinMomenta. However, so far, P2P lending had been operating in a regulatory grey area. As such, the rollout of these guidelines gives legitimacy to the business.

FinMomenta co-founder and CEO Brahma Mahesh Khaderbad believes it paves the way for P2P platforms to gain legality, transparency and credibility.

The RBI has said that every company seeking registration should have a net-owned fund of not less than Rs 2 crore.

The guidelines say that any fund transfer between participants on a P2P lending platform shall be through an escrow account, which will be operated by a trustee. At least two escrow accounts, one for funds received from lenders and pending disbursal, and the other for collections from borrowers, shall be maintained.

The central bank has said that the aggregate exposure of a lender to all his/her borrowers at any point, across all P2Ps, should be capped at Rs 10 lakh. The aggregate loans taken by a borrower at any point of time, across all P2Ps, has also been capped at the same amount. The exposure of a single lender to the same borrower, across all P2Ps, shall not exceed Rs 50,000.

Read more on the guidelines here.

P2P lending platforms to get transparent, safer (Business-Standard), Rated: A

The norms on peer-to-peer (P2P) lending platforms issued by the Reserve Bank of India (RBI) will help make them more transparent and also safer for customers. “The regulations ensure that P2P platforms will protect the interests of lenders and borrowers will get faster access to credit,” says Shankar Vaddadi, founder and director of i-lend.

What peer-to-peer lending is and how RBI’s guidelines will impact it (Financial Express), Rated: B

The RBI said P2P lending, even though of no significant in value, yet can “disrupt the financial sector and throw up surprises” in future, and the associated risks to the financial system are “too important to be ignored”.

The RBI has laid down following criteria for registering under Non-Banking Financial Companies (NBFC) :

  • P2Ps should have a minimum Rs 2 crore capital
  • P2Ps cannot take any loan exposure themselves
  • P2P will undertake credit assessment and risk profiling of the borrowers and lenders
  • P2P will maintain documents related to loan agreements
  • P2P will provide assistance in disbursement and repayments of loan amount
  • P2Ps cannot hold balance sheet or funds
  • P2Ps cannot cross-sell products except for some insurance products

“This is an extremely positive step for the P2P lending business. The retail millennial lenders, an investor demographic which has been focussed on extensively in the regulations will be leveraging the power of the crowd for the benefit of small
borrowers,” Vinay Mathews, Founder & COO, Faircent.com said.

Student micro-financing startup SlicePay raises Series A round (VC Circle), Rated: A

SlicePay, a digital payment platform catering to college students, has raised $2 million (about Rs 13 crore) in a Series A round from Japanese investment fund Das Capital and Russian early-stage investor Simile Venture Partners, its co-founder told VCCircle.

Existing investor Blume Ventures also participated in the round.

YES BANK launches second cohort of YES FINTECH accelerator (YourStory), Rated: A

YES BANK, India’s fifth-largest private sector bank, has been significantly contributing to the fintech space by collaborating with and mentoring more than 100 fintech startups to co-create innovative financial solutions for its Corporate, SME, and retail customer base. In March this year, they launched a business accelerator programme for fintech startups called YES FINTECH, in association with T-Hub, Anthill, and LetsTalkPayments.

YES BANK is all set to launch the second cohort of YES FINTECH, which will kick off on November 13.

The YES FINTECH roadshow in Mumbai will include a Fireside Discussion on GES (Global Entrepreneurship Summit) and its impact on Fintech and Mumbai as India’s Fintech Hub. In conversation will be Amit Goel, Founder LTP, Puneet Shukla, NITI Aayog and Vivek Belgavi, Partner, PwC. After this, Rajeev Chari, COO, Numberz and Arpit Ratan, Founder, Signzy, both startups that graduated from the Summer Cohort of YES FINTECH, will share their experience of being a part of the programme.

When: 6th October

Where: ISME Ace, One India Bulls, Lower Parel, Mumbai

Time: 2 pm-5pm

The YES FINTECH roadshow in Bengaluru will begin with a GES lead-up panel discussion on ‘Women in Fintech. Panellists will include Lizzie Chapman from Zestmoney, Prashanthi Reddy from YES BANK and Dr. Anna Roy of NITI Aayog.  Following this, Shankar, Founder, FRS Labs, and  Ankit Ratan, Founder, Signzy, both startups that graduated from the Summer Cohort of YES FINTECH, will share their experience of what it was to participate in the programme.

When: 11th October

Where: 91 Springboard, 8th Block Koramangala, Bengaluru

Time: 2 pm-5pm

Authors:

George Popescu
Allen Taylor

PeerIQ’s Marketplace Lending Securitization Tracker Q4 2016

PeerIQ’s Marketplace Lending Securitization Tracker Q4 2016

Executive Summary Marketplace lending securitization remains a bright spot in the ABS market. Total issuance topped $2.4 Bn this quarter with cumulative issuance now totaling $15.1 Bn. YTD issuance of the sector stands at $7.8 Bn as compared to $4.9 Bn from prior year, a 59% increase. Although MPL origination volumes have declined at some […]

PeerIQ’s Marketplace Lending Securitization Tracker Q4 2016

Executive Summary

Marketplace lending securitization remains a bright spot in the ABS market. Total issuance topped $2.4 Bn this quarter with cumulative issuance now totaling $15.1 Bn. YTD issuance of the sector stands at $7.8 Bn as compared to $4.9 Bn from prior year, a 59% increase.

Although MPL origination volumes have declined at some platforms, the percentage of loans funded through ABS is at a record high of 70%.

The movement towards rated securitizations at larger transaction sizes continues. Further, the growth in average deal size continued, growing to $252 Mn in 2016 as compared to $35 Mn in 2013.

New issuance spreads continued to tighten in—a credit friendly environment for securitization. In 2016, we saw moderate spread compression across senior classes, indicating stable investor appetite for MPL ABS paper in the market.

We estimate $6.3 Bn to $11.2 Bn MPL ABS issuance for 2017. Goldman Sachs, Morgan Stanley, and Citi take top positions on the league tables.

Ratings agencies grow increasingly comfortable with assessing MPL risk. Kroll provided the first rating for a securitization of Madden-Midland loans. DBRS tops the league tables in ratings activity.

We expect higher volatility from rising rates, regulatory uncertainty, and an exit from a period of unusually benign credit conditions. Platforms that can sustain low-cost capital access, build investor confidence via 3rd party tools, and embed strong risk management frameworks will grow and take market share.

Authors:

Wilfred Daye wilfred@peeriq.com

Jianguo Xiao jianguo@peeriq.com

Yishu Song yishu@peeriq.com

Investors should consider PeerIQ as only a single factor in making their investment decision. Please refer to the Disclosure Section, located at the end of this report, for information on disclaimers and disclosures.

Introduction

Marketplace Lending ABS Trends

The fourth quarter of 2016 saw steady growth in MPL securitization. Ten deals priced, totaling $2.4 Bn, another quarter of strong quarterly issuance. Total issuance for 2016 reached $7.8 Bn, as compared to $4.9 Bn for 2015 (59% YOY growth). This growth now brings the total size of MPL securitization issuance volume to date to $15.1 Bn.

Although we continue to see differentiation in credit performance and execution across issuers, overall, investor sentiment has improved dramatically versus a year ago. Spreads on new issue senior consumer MPL ABS have tightened 50% for 2016; and the demand for paper across the capital structure has been over-subscribed for new issuance deals.

The market continued to move towards larger deals with repeat issuers. Further, new issuance pricing spreads tightened, in line with other securitized products, although MPL bonds continue to offer attractive relative value for comparable duration and rated products.

All variations of originators—(i) balance-sheet, (ii) pure marketplace lenders, and (iii) hybrids—have established programs to tap into the ABS markets in 2016. In July, Marlette issued its first unsecured consumer loan MPL ABS deal from its new shelf (MFT). Lending Club introduced the first deal on its branded shelf (LCIT), suggesting a pattern of repeat standardized issuance. Looking ahead in Q1 2017, Upstart and Prosper reportedly intend to inaugurate a securitization program.

Further, SoFi, the largest MPL issuer, has emerged as a model for successful repeat issuance, enjoying a 70 to 110 bps funding cost advantage in senior ABS pricing versus its peers in the student lending category.

Macro Conditions

In a widely expected move, on December 14th, FOMC officials increased the Fed Funds rate by 25 basis points to a target range of between 50 and 75 basis points. The Fed is taking an increasingly hawkish stance due to an improving growth outlook (3.5% annualized growth in Q3), tightening labor market (4.6% unemployment, a nine-year low), and wage growth (91-month high). The ten-year inflation bonds traded at ~2% breakeven rate at the year-end 2016. Further, consumer confidence in the economy is at its highest level since August 2001.

A strong “risk-on” environment has prevailed since the US election. Treasuries have sold off and equity markets haverallied on higher growth and inflation expectations. The UST 10-year bond yield of 2.4% is up a whopping 54 bps since Election Day. Equity markets have rallied and the S&P 500 increased 6.4% post-election.

For 4Q16, overall credit markets have exhibited low volatility and credit conditions remain relatively benign. For instance, implied volatility on 3-month CDX HY options stayed at their historical low of 37%. On-the-run CDX HY traded in a range bound between 375 to 420 basis points. Further, in US CLO market, the median YTD total return (through November 2016) was 2.8% for AAAs, 4.0% for AAs, 5.8% for single-As, and 11.3% for BBBs. The US loan index returned approximately 8.9% from Jan to Nov.

Within the MPL space specifically, the above conditions paired with greater investor acceptance—including the first rated deal consisting of Madden-Midland loans in Lending Club’s LCIT 2016-NP2.

Regulatory Uncertainty Remains High

Concerns of heightened regulatory scrutiny last year have given way to a largely constructive outlook, although regulatory uncertainty remains high.

Platforms are sponsoring self-regulatory efforts via trade associations such as SFIG and the Marketplace Lending Association. The message is resonating. In an important milestone for 2016, US Treasury, Federal Reserve, SEC, and the Office of the Comptroller of the Currency (OCC), each publicly acknowledged that marketplace lending is expanding access to credit to traditionally under-served segments.

Regulatory uncertainty remains high for marketplace lenders that rely on partner-funding bank model. The consensus view is that the risk that courts deem loans originated via the partner-funding bank model as invalid is low, although such an outcome, however remote, is paired with high severity.

In November, Thomas Curry, head of the OCC, announced that the agency would grant national bank charters to qualifying FinTech firms. Curry cited “public interest,” a “patchwork of supervision,” and the “great potential to expand financial inclusion” as motivations for the charter.

The charter would offer pre-emption—the ability of chartered FinTechs to export rates across state lines—and avoid the need for disparate state-by-state licensing or originating via partner-funding banks. In constructing the guidelines, the OCC seeks to continue to foster financial inclusion via FinTech innovation, while maintaining public confidence in national banks and the banking system more generally.

The supervisory guidelines in the proposal require, among other provisions, a top-down culture of compliance, a risk assessment and management framework, and to-be-specified capital and liquidity rules. (See here for PeerIQ’s summary of the supervisory guidelines).

The strict qualitative criteria suggest that the charter will be awarded sparingly, case-by-case, and to FinTechs that do not have going-concern risk. More fundamentally, the charter does not address the core funding and liquidity issues impacting the sector. The OCC is accepting comments on the charter and is expected to release final rules in April 2017.

Finally, there several new legislative proposals relevant to the MPL sector, which we summarize below:

Warehouse financing costs remain elevated due to a limited supply of warehouse finance, limited credit performance data, and concerns on data integrity (see CAN Capital credit facility breach).

We observe credit facility financing costs on unsecured personal loans in the 3.5% to 6.5% range. Financing costs are a function of counterparty risk, data integrity, asset class, credit performance, recourse vs. non-recourse financing, and ability to offload risk via an active ABS market.

 

Access to financing and liquidity continues to be central concern for investors in MPL space. This sentiment was highlighted when equity shares of OnDeck surged 5.4% immediately after the announcement of $200 Mn credit facility with Credit Suisse on December 9th.

Other publicly reported credit facility financings in the quarter include Fundation ($100 Mn line from GS), Solar Mosaic ($250 Mn from DB), and We Lab ($25 Mn line from ING Bank), and Apple Pie (SunTrust Bank).

Trigger Breaches

At the end of Q3, PeerIQ predicted several trigger breaches would take place in the ensuing months.

Trigger breaches are manifestation of unexpected credit performance, poor credit modeling, unguarded structuring practice. The average time to breach performance triggers for consumer MPL ABS deals was approximately 11 month as collateral losses ramped up within the deal.

 

During the past three months, four unsecured consumer and one SME deals had breached triggers. The exhibit below summarizes the ten active deals that had breached triggers in MPL ABS sector (eight unsecured consumer and two SME deals) with $1.3 Bn of total issuance volume (Note: below we excluded two additional retired deals that breached triggers (MPLT 2015-OD2 and MPLT 2015-OD1).

 

 

After two years of seasoning, CAN re-classified a portion of collateral loans that were represented as current but should have been treated as delinquent in CAN 2014-1A transaction—a material breach in representations and warranties. The newly identified delinquent loans also led to breach of the minimum excess spread trigger.

The negative headline associated with trigger breaches increased the cost and availability of funding for originators. The growing number of deals breaching triggers in MPL ABS are leading marketplace lenders taking greater control of their ABS programs to set standards and structure.

Sponsors and ABS investors are using sophisticated 3rd party analytics such as those offered by PeerIQ to independently model deal economics and monitor collateral on an on-going basis, perform 3rd party credit validation and verification.

Data & Standardization

Ratings agencies continued to raise the quality and history of data as key factors in their rating assessments. The paucity of historical data increases the error range on cumulative loss estimates which makes ratings assessment difficult.

Finally, we note that the Structured Finance Industry Group (SFIG) workstream on data reporting standards (including PeerIQ as a key participant) released a “Green Paper” providing for data reporting standards. SFIG also has a workstream on representations & warranties across originators—a welcome development for the sector.

Definitions and Inclusion Rules

Our Tracker includes all issuances connected to assets originated by marketplace lending platforms, which we define as including both:

  • Online and other novel technologies to increase operational efficiency, risk accuracy, and borrower experience, and
  • Non-deposit funding for lending capital.

We recognize there is rapid innovation in lending channels, and welcome all comments and consideration on inclusion rules.

  1. Quarterly Round-up

Despite holiday season slowdown, this past quarter saw ten securitization deals, adding $2.4 Bn in new issuance, consistent with Q3 record deal flow. This represents 23.0% YoY growth in total issuance year-to-date and 3.7% growth from Q3, Indeed, MPL securitization remains a bright spot in the ABS world, with its 23.0% YoY growth.

Total securitization issuance to date now stands at $15.1 Bn, with 72 deals issued to date (43 Consumer, 20 Student, 1 Mortgage and 8 SME) since September 2013 (Exhibit 1).

 

Examining issuance by underlying collateral segment, we see that Consumer and Student have similar volumes, with Consumer continuing to lead with $7.1 Bn issued to date, as compared to Student at $6.0 Bn (Exhibit 2). Issuance activities in the Small-Medium Enterprise (SME) space was muted for the quarter. SME remains the smallest segment with $1.7 Bn total issuance.

There were eight new deals in Q4 2016:

  • SoFi: SOFI 2016-E, SCLP 2016-3, SCLP 2016-5, SOFI 2016-F, SFPMT 2016-1
  • LendingClub: LCIT 2016-NP2, MHMT 2016-LC1
  • Earnest: EARN 2016-D
  • Prosper: INSKT 2016-1
  • CommonBond: CBSLT 2016-B

This quarter, SoFi priced its inaugural residential mortgage-backed securitization, which is backed by a $169 Mn pool of first-lien, fixed-rate, prime residential mortgage loans originated by SoFi. SFPMT 2016-1, led by Barclays, will issue four classes of super senior notes, and two tranches of supportive senior notes. (See PeerIQ newsletter for further analysis.)

Since 2010, the market has issued approximately $40 Bn of prime jumbo securitizations dominated by bank players like J.P. Morgan and Credit Suisse, with combined new issuance market share of over 50%. SoFi’s inaugural prime jumbo securitization had demonstrated its ability to grow through value-added origination across verticals, starting with student loan refinance, unsecured consumer loans, and then mortgages. It also supports our thesis that the demarcation line between FinTech and traditional asset classes will be blurred as this emerging industry grows.

In addition to the expansion into new collateral category prime jumbo mortgages, rating agency blessing continues to be a key driver for strong deal execution. All deals issued in 4Q16 were rated by at least one rating agency (Exhibit 5), except for MHMT 2016-LC1 and INSKT 2016-1. As of today, we track 120 MPL ABS rated by rating agencies, of which, 24% were rated in 4Q16, representing stabilized rating agency participation (Exhibit 6). Again, we expect that the vast majority of MPL ABS to be rated as issuers seek to broaden the base of eligible investors.

 

Of note, in Q4, Jefferies brought the first rated LendingClub Near-Prime securitization LCIT 2016-NP2 into the market. This second LCIT shelf deal is also consisted of Madden-Midland loans in its collateral pool. Given the collateral pool of the LCIT 2016-NP1 (unrated) and NP2 (rated) deals are similar and tranches have the identical credit enhancement, the expected loss of each tranche should also be comparable. However, the pricing for LCIT 2016-NP2 A (BBB-rated) was about 75 basis points tighter than LCIT 2016-NP1 A (Non-rated) tranche.

The emergence of rated securities from LCIT shelf also supports our belief that the rating agencies are more comfortable in rating this nascent industry with more historical performance data. Issuers are more inclined to get their deals rated to expand their investor base and increase their credibility with investors.

On the SME front, despite lack of new issuance for the quarter, OnDeck, the leading SME online lender, closed a $200 Mn DBRS A- rated asset-backed revolving debt facility with Credit Suisse, Prime OnDeck Receivable Trust II. The rating of the Class A Loans reflected the 18% of initial hard credit enhancement comprised of the 1% reserve account and 17% overcollateralization. Additional credit support may be provided from excess spread available in the structure.

Finally, deals continue to increase in average deal size over time, led primarily by SoFi’s large placements. The average securitization deal now stands at $267 Mn for 2016.

  1. MPL Securitization League Tables

We continue to see Goldman Sachs and Morgan Stanley ramping up deal participation aggressively in Q4. Maintaining its one number rank on league table, Goldman Sachs was involved in $3.6 Bn in total new issuance, a 44% growth from 3Q16. GS worked with SoFi, CommonBond, and Earnest and other originators to capture about 23% of the market share in MPL ABS by issuance volume. Further, Morgan Stanley showed 60% growth in deal participation with $3.3 Bn in total volume for the quarter, a 4% increase in market share from 3Q2016. Top three dealers, Goldman Sachs, Morgan Stanley, and Citi, took over about 50% of the total market share in MPL space.

Further, as mentioned in our 3Q2016 tracker, banks had pulled back from financing business in MPL space due to recent headlines, regulatory risks, or firm-specific considerations. Yet, dealers continued to display heightened interest in MPL ABS securitization, intermediating originators’ demand for financing and absolute investors’ desire for yield. In particular, we saw Mizuho Securities participated its first MPL ABS transaction (SOFI 2016-F) with Morgan Stanley in December.

As evidenced by the continued issuance, the impact of Dodd-Frank risk retention rules, effective on December 24, 2016, has not led to an appreciable slowdown in new issuance activities. The risk retention rule had indeed slowed down the issuance activities and led to consolidation for mature securitization markets such as Commercial Mortgage Backed Securities (CMBS) and Collateralized Loan Obligation (CLO) market.

Overall, the rule suggested that securitizers will need to commit approximately $23 Bn of new capital to sustain current overall new issuance securitization market in US.

The negative impact of risk retention is masked and by the growth rate of the MPL ABS market and by dealers’ positioning to gain market share.

Turning to the co-manager league table, SoFi doubled deal volume this quarter to $3.0 Bn. As telegraphed by SoFi, SoFi ended 2016 with twelve new deals across student, personal, and mortgage verticals. SoFi is the co-manager for almost all of its deals, capturing approximately 40% of total new issuance (Exhibit 7).

Deutsche Bank raced head of BoA and took over the second position with $684 Mn of deal volume on the co-manager league table, continuing its growth with strong conviction in supporting the MPL ecosystem. The top three co-managers on the league table took over approximately 60% of the total market share. Greensledge, replacing Credit Suisse, stepped into the six place with $421 Mn in deal participation.

Kroll, S&P and Fitch in the amount of rated bonds. DBRS rated $6.4 Bn Student MPL ABS, or approximately 47% of sub-segment, competing primarily against Moody’s within the student sector. Kroll dominates the Consumer MPL ABS category with about 50% market share. The mortgage sub-segment currently has an even split amongst DBRS, Fitch and Kroll.

III. New Issuance Spreads

New issuance spreads in 4Q16 continued to tighten across capital structures, reflecting a healthy risk appetite in the capital markets. Further, we saw a continued preference for senior tranches over riskier subordinated bonds. As reflected in the exhibit below, this overall senior preference leads to a steepening of the overall term structure, with investors demanding higher premiums for riskier tranches— and this remains true across all loan segments. This is particularly evident in student sub-segment. Credit spread curves shifted downward in parallel, suggesting an overall yield compression and favorable credit environment in 4Q16.

  1. Outlook

The outlook for the year ahead presents new challenges and opportunities for marketplace lenders.

We expect higher volatility from rising rates, increased regulatory uncertainty, and an exit from a post-crisis period characterized by unusually benign credit performance.

We see opportunities for lenders, as consumer borrowers move out of the de-leveraging phase, which expands the total addressable market. We also see increased bank partnerships as banks seek to improve their ROE and cover their cost of capital by partnering with MPL originators.

Higher Interest Rates

High financing costs continue to driving a wedge between would-be whole loan buyers and originators. Higher short-term interest rates from a Fed tightening cycle will further reduce net margins for whole loan investors.

Platforms that can successfully pass on rates to borrowers to offset the reduction in net interest margin reduction, increase operating efficiencies, or improve execution in the ABS market stand to take market share. We expect Fed rate hike as a continuation of a tightening cycle. Higher rates will leader to higher ABS coupons for 2017. Therefore, we expect to see originators re-price interest rates on MPL loans.

Higher Volatility from Regulatory Uncertainty

Although the regulatory outlook is constructive, regulatory uncertainty remains high.

Market participants are optimistic. Financial stocks as reflected by the KBW Index have rallied over 20% since Election Day pricing in greater growth from deregulation and earnings from higher rates. Markets expect a bias to action from the Trump administration, a more favorable regulatory outlook, and potential for relief on risk retention, bank capital

  • liquidity requirements, and a reduction in CFPB and SEC enforcement actions. Markets appear to be pricing in near perfect execution of an idealized regulatory environment. We see this as unlikely.

The President-elect Trump’s transition team, including the nominee for Treasury Secretary, has indicated the new administration wants to “strip back” parts of Dodd-Frank. While the new administration has made some general statements about Dodd-Frank, it’s too early to tell which changes may materialize.

Within MPL specifically, the SEC, the OCC, and state regulators have differing views on jurisdiction and approach to regulation.

Moreover, given the cloture rules in the Senate which require 60 votes to overcome a filibuster, we expect the pace of regulatory relief will be slower than most market participants expect

Re-Normalization of Credit Performance

We are now seven years behind the Great Recession. Consistent with Fair Credit Reporting Act waiting period requirements, derogatory credit items (“derogs”) associated with bankruptcy, foreclosure, and short sales will fall off borrower credit bureau reports in 2017. As a result, we expect an expansion of credit eligible borrowers.

Also, borrowers that defended their credit scores through the cycle have positively self-selected. All things being equal, a borrower with a credit score of 700 today is not as strong as a borrower with a score of 700 after the Great Recession.

For 2017, we expect:

  1. Robust growth—a 47% increase in ABS volumes and greater dealer participation
  1. Continued shift to standardized, repeat issuance
  1. New products and additional modes of distribution
  1. Continued trend of bank partnership
  1. Greater investments in 3rd party solutions to improve investor confidence

Continued Growth in ABS Issuance Volumes

As marketplace lending loan growth rates in the US have accelerated over the last few years, lenders have become increasingly reliant on institutional capital, with many platforms particularly focused on securitization as core pillar of funding.

Rated securitization has moved from a coming-of-age milestone in the maturation of an originator, to an essential pillar for funding new origination. We forecast a 47% growth in ABS issuance under our base case scenario.

The re-normalization of credit performance will create significant analytical challenges for underwriting and investment analysis. For instance, as losses will revert to historical levels, models trained on post-crisis data will tend to underestimate losses.

Further, lenders face new constraints in how they manage their risk from consumer protection regulation such as the CARD Act of 2009, which among other rules, eliminated “universal default” as a mechanism for mitigating risk.

Advanced risk analytics and historical data (such as offerings produced from uniting the TransUnion dataset with PeerIQ analytics) will play an important role in risk assessment and management for originations and investors alike.

Strong ABS Issuance Outlook

As we noted in our prior securitization tracker, numerous factors—platform rate increases, tighter underwriting, spread tightening in the primary and secondary ABS markets—improve the economics for whole loan buyers that fund via securitization.

Exhibit 15 below confirms our thesis that securitization is an essential pillar for the marketplace lending industry. Our analysis finds that the percentage of loans securitized via ABS stands at an all-time high of 70%.

 

Shifting Towards Standardized and Repeat Issuance

We anticipate greater participation in the securitization space as one-off issuers seek to become repeat issuers to optimize deal cost and capital market distribution.

PeerIQ anticipates the rise of contributed collateral “club deals” as platforms seek to dive standardization in deal terms while also offering whole loan investors a quarterly path to liquidity.

The growth in club deals will usher in a higher level of data homogenization, greater consistency in deal structure, increased data integrity, and consistent valuation methods.

New Products and Additional Modes of Distribution

Outside of securitization, additional modes of distribution will emerge. RiverNorth received SEC approval for a MPL-dedicated close-end fund in Q3, signaling the maturation of another major funding source for marketplace lending platforms. Other auxiliary funding channels including asset managers offering term capital, CUSIPs, private equity, and seasoning vehicles will expand the investors base for marketplace lending category.

Bank Partnerships

The seismic regulatory changes post the Great Recession of 2008 has forced the global banking sector to adjust the pre-2008 business model.

We argued in prior research that banks can improve their ROE position by funding or financing whole loans from marketplace lenders, and that most banks will choose to partner with marketplace lenders rather than compete.

We believe 2017 will feature a number of bank partnerships with non-banks, and increased competition from traditional banks.

We expect traditional banks to cooperate with marketplace lenders to marry their low-cost funding profile with low-cost operations of marketplace lenders.

Greater Investments in 3rd Party Solutions

To gain investor confidence, marketplace lenders are now adjusting to the demand from warehouse lenders and whole loan investors for greater transparency and due diligence, including independent reviews, “hot” back-up servicing arrangements, verification, credit validation and heightened data integrity standards.

Further, the recent uptick in delinquency and losses in SME and other sub-segments, in general, leads to a persistent focus on fundamentals, such as credit underwriting and acquisition cost.

Originators and ABS investors will extend their investments in 3rd party data and analytics for a variety of investment and distribution activities, such as structuring deal waterfalls, determining deal collateral triggers, monitoring deal performance, coordinating club securitization deals, and improving investor confidence with loan-level data transparency.

The above trends highlight the need for 3rd party analytics, such as those offered by PeerIQ, to improve transparency, standardization, comparability, with the goal of improving investor confidence and the smooth functioning of ABS markets.

We remain optimistic on the marketplace lending ecosystem. The broad secular trends underpinning non-bank lending growth and the global demand for yield remain intact.

Appendix: Marketplace Lending Securitizations to Date

Ticker Type Originator Shelf Issuer Issue Date Collat Amt Credit Amt Initial WAL Coupo Initial Est. Mood S&P DBR Fitc Kroll Rate
($mm) Support ($mm) (yrs) n Type Coupo Pricing ys S h d
SOFI 2016-F A1 Student SoFi SOFI SoFi 22-Dec-16 131.66 16.1% 40.7 3.22 Floating 1.95 n/a A2 Rated
SOFI 2016-F A2 Student SoFi SOFI SoFi 22-Dec-16 131.66 16.1% 82.8 3.48 Fixed 3.02 n/a A2 Rated
SOFI 2016-F B Student SoFi SOFI SoFi 22-Dec-16 131.66 11.0% 7.2 9.51 Variable 4.45 n/a Baa2 Rated
LCIT 2016-NP2 A Consumer Lending Club LCIT LendingClub 2-Dec-16 121.73 35.5% 85.3 1.6 Fixed 3.00 195 BBB Rated
LCIT 2016-NP2 B Consumer Lending Club LCIT LendingClub 2-Dec-16 121.73 23.0% 16.4 2.4 Fixed 6.00 458 BB+ Rated
SFPMT 2016-1A 1A6 Mortgage SoFi SFPMT SoFi 1-Dec-16 168.79 15.0% 84.1 4.8 Variable 3.00 220 AAA AAA AAA Rated
SFPMT 2016-1A 1A8 Mortgage SoFi SFPMT SoFi 1-Dec-16 168.79 15.0% 28.0 4.8 Variable 3.00 210 AAA AAA AAA Rated
SFPMT 2016-1A 1AMF Mortgage SoFi SFPMT SoFi 1-Dec-16 168.79 6.1% 11.8 4.8 Variable 3.00 250 AAA AAA AAA Rated
SFPMT 2016-1A 2A6 Mortgage SoFi SFPMT SoFi 1-Dec-16 168.79 15.0% 23.5 3.66 Variable 2.50 195 AAA AAA AAA Rated
SFPMT 2016-1A 2A8 Mortgage SoFi SFPMT SoFi 1-Dec-16 168.79 15.0% 7.8 3.66 Variable 2.50 180 AAA AAA AAA Rated
SFPMT 2016-1A 2AMF Mortgage SoFi SFPMT SoFi 1-Dec-16 168.79 6.1% 3.3 3.66 Variable 2.50 215 AAA AAA AAA Rated
SFPMT 2016-1A B1 Mortgage SoFi SFPMT SoFi 1-Dec-16 168.79 3.7% 4.0 n/a Variable 3.17 n/a AA AA AA Rated
SFPMT 2016-1A B2 Mortgage SoFi SFPMT SoFi 1-Dec-16 168.79 2.3% 2.4 n/a Variable 3.17 n/a A A A Rated
SFPMT 2016-1A B3 Mortgage SoFi SFPMT SoFi 1-Dec-16 168.79 1.6% 1.2 n/a Variable 3.17 n/a BBB BBB BBB Rated
SFPMT 2016-1A B4 Mortgage SoFi SFPMT SoFi 1-Dec-16 168.79 1.1% 0.9 n/a Variable 3.17 n/a BB BB BB Rated
SFPMT 2016-1A B5 Mortgage SoFi SFPMT SoFi 1-Dec-16 168.79 0.6% 0.8 n/a Variable 3.17 n/a B B B Rated
SFPMT 2016-1A B6 Mortgage SoFi SFPMT SoFi 1-Dec-16 168.79 0.0% 1.0 n/a Variable 3.17 n/a 0
SOFI 2016-E A1 Student SoFi SOFI SoFi 22-Nov-16 584.42 16.4% 164.6 2.97 Floating 1.38 85 Aaa AAA Rated
SOFI 2016-E A2A Student SoFi SOFI SoFi 22-Nov-16 584.42 16.5% 203.3 1.25 Fixed 1.63 55
SOFI 2016-E A2B Student SoFi SOFI SoFi 22-Nov-16 584.42 16.5% 155.2 4.63 Fixed 2.49 90 Aaa AAA Rated
SOFI 2016-E B Student SoFi SOFI SoFi 22-Nov-16 584.42 10.6% 37.0 n/a Fixed 3.44 175
SOFI 2016-E C Student SoFi SOFI SoFi 22-Nov-16 584.42 6.7% 24.4 8.43 Variable 4.43 265 Baa2 AL Rated
SCLP 2016-5 A Consumer SoFi SCLP SoFi 18-Nov-16 250.02 25.2% 188.3 1.86 Fixed 3.06 n/a A A+ Rated
SCLP 2016-5 B Consumer SoFi SCLP SoFi 18-Nov-16 250.02 15.1% 25.4 4.98 Fixed 4.55 n/a
INSKT 2016-1 A Consumer Prosper INSKT Insikt 2-Nov-16 24.80 30.7% 17.2 1.02 Fixed 4.00 n/a
INSKT 2016-1 B Consumer Prosper INSKT Insikt 2-Nov-16 24.80 9.2% 5.3 3.23 Fixed 11.00 n/a
EARN 2016-D A1 Student Earnest EARN Earnest 31-Oct-16 174.74 13.5% 51.3 3.69 Floating 2.16 140 A AAL Rated
EARN 2016-D A2 Student Earnest EARN Earnest 31-Oct-16 174.74 13.5% 104.2 3.56 Fixed 2.72 155 A AAL Rated
EARN 2016-D B Student Earnest EARN Earnest 31-Oct-16 174.74 6.1% 13.4 4.16 Fixed 3.80 260 BBB Rated
EARN 2016-D C Student Earnest EARN Earnest 31-Oct-16 174.74 2.9% 5.9 4.33 Fixed 4.39 500 BB Rated
CBSLT 2016-B A1 Student CommonBond CBSLT CommonBond 20-Oct-16 168.63 15.0% 86.7 3.92 Fixed 2.73 155 A1 AAL Rated
CBSLT 2016-B A2 Student CommonBond CBSLT CommonBond 20-Oct-16 168.63 15.0% 64.2 3.79 Floating 2.21 145 A1 AAL Rated
CBSLT 2016-B B Student CommonBond CBSLT CommonBond 20-Oct-16 168.63 5.0% 17.7 4.4 Fixed 4.00 280 BBB Rated
MHMT 2016-LC1 A Consumer Lending Club MHMT Prospect 13-Oct-16 314.14 35.5% 204.2 0.62 Fixed 4.19 336
MHMT 2016-LC1 B Consumer Lending Club MHMT Prospect 13-Oct-16 314.14 23.0% 39.3 1.63 Fixed 6.15 396
MHMT 2016-LC1 C Consumer Lending Club MHMT Prospect 13-Oct-16 314.14 10.0% 39.3 2 Fixed 10.00 n/a
SCLP 2016-3 A Consumer SoFi SCLP SoFi 13-Oct-16 599.94 24.7% 451.7 1.85 Fixed 3.05 200 A A Rated
SCLP 2016-3 B Consumer SoFi SCLP SoFi 13-Oct-16 599.94 14.6% 60.9 4.97 Variable 4.49 233 BBB BBB Rated
SOFI 2016-D A1 Student SoFi SOFI SoFi 19-Sep-16 483.04 29.6% 142.8 3.31 Floating 1.60 95 Aaa AAA Rated
SOFI 2016-D A2A Student SoFi SOFI SoFi 19-Sep-16 483.04 27.8% 134.4 1.22 Fixed 1.53 55 Aaa AAA Rated
SOFI 2016-D A2B Student SoFi SOFI SoFi 19-Sep-16 483.04 26.7% 128.8 5.02 Fixed 2.34 110 Aaa AAA Rated
SOFI 2016-D B Student SoFi SOFI SoFi 19-Sep-16 483.04 6.4% 30.7 8.77 Variable 3.23 175 A1 AAL Rated
SCLP 2016-4 A Consumer SoFi SCLP SoFi 13-Sep-16 223.10 20.5% 178.5 1.96 Fixed 3.18 214 A Rated
SCLP 2016-4 B Consumer SoFi SCLP SoFi 13-Sep-16 223.10 17.0% 7.8 5 Variable 4.83 358 BBB+ Rated
SCLP 2016-4 C Consumer SoFi SCLP SoFi 13-Sep-16 223.10 9.5% 16.7 5.12 Variable 5.92 467 BBB- Rated
CILO 2016-LD1 A Consumer Cross River Bank CILO Ellington 24-Aug-16 112.91 30.0% 87.0 1.18 FIXED 3.96 396
CILO 2016-LD1 B Consumer Cross River Bank CILO Ellington 24-Aug-16 112.91 15.0% 18.7 3.13 FIXED 5.50 550
AVNT 2016-C A Consumer Avant AVNT Avant 16-Aug-16 312.59 56.9% 138.0 0.39 Fixed 2.96 350 A- Rated
AVNT 2016-C B Consumer Avant AVNT Avant 16-Aug-16 312.59 31.5% 79.2 1.56 Fixed 4.92 700 BBB- Rated
AVNT 2016-C C Consumer Avant AVNT Avant 16-Aug-16 312.59 19.3% 38.1 2.5 Fixed 8.83 779 BB Rated
LCIT 2016-NP1 A Consumer Lending Club LCIT LendingClub 4-Aug-16 135.48 n/a 86.7 n/a Fixed 3.75 297
LCIT 2016-NP1 B Consumer Lending Club LCIT LendingClub 4-Aug-16 135.48 n/a 16.7 n/a Fixed 6.50 560
MFT 2016-1A A Consumer Cross River Bank MFT Marlette 2-Aug-16 205.44 72.5% 148.9 n/a Fixed 3.06 225 A Rated
MFT 2016-1A B Consumer Cross River Bank MFT Marlette 2-Aug-16 205.44 8.7% 18.0 n/a Fixed 4.78 385 BBB Rated
MFT 2016-1A C Consumer Cross River Bank MFT Marlette 2-Aug-16 205.44 8.7% 18.0 n/a Fixed 9.09 825 BB Rated
SCLP 2016-2 A Consumer SoFi SCLP SoFi 1-Aug-16 575.52 26.5% 425.9 1.84 Fixed 3.09 215 A A Rated
SCLP 2016-2 B Consumer SoFi SCLP SoFi 1-Aug-16 575.52 17.0% 54.7 4.87 Variable 4.77 365 BBB BBB Rated
EARN 2016-C A1 Student Earnest EARN Earnest 29-Jul-16 200.75 28.3% 56.8 3.62 Floating 2.33 185 AAL Rated
EARN 2016-C A2 Student Earnest EARN Earnest 29-Jul-16 200.75 59.3% 119.0 3.57 Fixed 2.68 180 AAL Rated
EARN 2016-C B Student Earnest EARN Earnest 29-Jul-16 200.75 6.8% 13.7 4.03 Fixed 4.46 340 BBB Rated

 

Ticker Type Originator Shelf Issuer Issue Date Collat Amt Credit Amt ($mm) Initial WAL Coupon Initial Est. Moodys S&P DBRS   Fitch Kroll Rated
($mm) Support (%) (yrs) Type Coupon Pricing
SOFI 2016-C A1 Student SoFi SOFI SoFi 27-Jul-16 467.50 27.5% 128.6 3.26 Floating 1.59 110 Aaa AAA Rated
SOFI 2016-C A2A Student SoFi SOFI SoFi 27-Jul-16 467.50 30.5% 142.5 1.26 Fixed 1.48 65 Aaa AAA Rated
SOFI 2016-C A2B Student SoFi SOFI SoFi 27-Jul-16 467.50 26.0% 121.7 4.98 Fixed 2.36 135 Aaa AAA Rated
SOFI 2016-C B Student SoFi SOFI SoFi 27-Jul-16 467.50 6.4% 29.8 8.49 Variable 3.35 200 A2 AAL Rated
SCLP 2016-1 A Consumer SoFi SCLP SoFi 27-Jun-16 506.40 25.5% 379.8 2.3 Fixed 3.26 238 A A Rated
SOFI 2016-B A1 Student SoFi SOFI SoFi 26-May-16 427.03 23.7% 101.4 3.28 Floating 1.72 120 Aaa AAA Rated
SOFI 2016-B A2A Student SoFi SOFI SoFi 26-May-16 427.03 28.7% 122.7 1.14 Fixed 1.68 80 Aaa AAA Rated
SOFI 2016-B A2B Student SoFi SOFI SoFi 26-May-16 427.03 30.8% 131.5 4.78 Fixed 2.74 145 Aaa AAA Rated
SOFI 2016-B B Student SoFi SOFI SoFi 26-May-16 427.03 5.6% 24.1 8.25 Fixed 3.80 225 A2 AH Rated
ONDK 2016-1A A SME OnDeck ONDK OnDeck 17-May-16 265.96 23.6% 211.5 2.28 Fixed 4.21 325 BBB+ A Rated
ONDK 2016-1A B SME OnDeck ONDK OnDeck 17-May-16 265.96 9.6% 38.5 2.71 Fixed 7.63 670 BB- BBBL Rated
EARN 2016-B A1 Student Earnest EARN Earnest 11-May-16 241.93 27.2% 65.8 3.69 Floating 2.57 205 A A Rated
EARN 2016-B A2 Student Earnest EARN Earnest 11-May-16 241.93 61.9% 149.6 3.5 Fixed 3.02 200 A A Rated
EARN 2016-B B Student Earnest EARN Earnest 11-May-16 241.93 4.0% 9.6 4.17 Variable 4.81 375 BBB BBB+ Rated
AVNT 2016-B A Consumer Avant AVNT Avant 28-Apr-16 344.83 49.1% 179.1 0.56 Fixed 3.92 325 A- Rated
AVNT 2016-B B Consumer Avant AVNT Avant 28-Apr-16 344.83 26.8% 76.7 1.83 Fixed 7.80 700 BBB- Rated
AVNT 2016-B C Consumer Avant AVNT Avant 28-Apr-16 344.83 13.8% 44.8 2.73 Fixed 10.60 1,150 BB Rated
CBSLT 2016-A A1 Student CommonBond CBSLT CommonBond 21-Apr-16 162.72 57.6% 93.8 4.3 Fixed 3.32 225 AH Rated
CBSLT 2016-A A2 Student CommonBond CBSLT CommonBond 21-Apr-16 162.72 29.9% 48.6 4.21 Floating 2.72 225 AH Rated
CBSLT 2016-A B Student CommonBond CBSLT CommonBond 21-Apr-16 162.72 6.6% 10.8 4.2 Fixed 4.00 395 BBB Rated
CHAI 2016-PM1 A Consumer Prosper CHAI Citi 31-Mar-16 314.56 33.0% 212.3 0.97 Fixed 4.65 400 A- A Rated
CHAI 2016-PM1 B Consumer Prosper CHAI Citi 31-Mar-16 314.56 25.1% 24.9 2.44 Fixed 7.67 700 BBB- BBB Rated
CHAI 2016-PM1 C Consumer Prosper CHAI Citi 31-Mar-16 314.56 12.0% 41.2 2.83 Fixed 10.26 1,145 B BB- Rated
CHAI 2016-MF1 A Consumer Marlette CHAI Citi 4-Mar-16 156.50 28.0% 113.5 n/a Fixed 4.48 400 A Rated
CHAI 2016-MF1 B Consumer Marlette CHAI Citi 4-Mar-16 156.50 19.2% 13.7 n/a Fixed 6.64 600 BBB Rated
CHAI 2016-MF1 C Consumer Marlette CHAI Citi 4-Mar-16 156.50 10.5% 13.7 n/a Fixed 10.39 990 BB Rated
SOFI 2016-A A1 Student SoFi SOFI SoFi 4-Mar-16 591.51 22.6% 133.6 3.8 Floating 2.27 200 Aa2 AAA Rated
SOFI 2016-A A2 Student SoFi SOFI SoFi 4-Mar-16 591.51 62.2% 367.9 3.65 Fixed 2.76 205 Aa2 AAA Rated
SOFI 2016-A B Student SoFi SOFI SoFi 4-Mar-16 591.51 8.4% 49.9 4.14 Fixed 3.57 350 Baa2 BBBH Rated
AVNT 2016-A A Consumer Avant AVNT Avant 26-Feb-16 344.91 51.0% 172.4 0.45 Fixed 4.11 350 A- Rated
AVNT 2016-A B Consumer Avant AVNT Avant 26-Feb-16 344.91 30.0% 72.4 1.68 Fixed 7.65 700 BBB- Rated
AVNT 2016-A C Consumer Avant AVNT Avant 26-Feb-16 344.91 14.0% 55.2 2.66 Fixed 9.79 na BB Rated
MPLT 2016-LD1 A Consumer LoanDepot MPLT Jefferies 19-Feb-16 100.00 26.0% 74.0 1.31 Fixed 5.25 451
MPLT 2016-LD1 B Consumer LoanDepot MPLT Jefferies 19-Feb-16 100.00 11.5% 14.5 3.89 Fixed 9.50 849
EARN 2016-A A1 Student Earnest EARN Earnest 10-Feb-16 119.48 29.1% 34.7 3.51 Floating 1.99 215 A Rated
EARN 2016-A A2 Student Earnest EARN Earnest 10-Feb-16 119.48 58.8% 70.2 3.51 Fixed 2.50 215 A Rated
EARN 2016-A B Student Earnest EARN Earnest 10-Feb-16 119.48 5.9% 7.1 3.8 Fixed 2.50 290 BBB Rated
MPLT 2015-OD4 A SME OnDeck MPLT Jefferies 24-Dec-15 151.21 15.0% 134.9 n/a Fixed 3.25 287 A Rated
MPLT 2015-OD4 B SME OnDeck MPLT Jefferies 24-Dec-15 151.21 5.0% 15.9 n/a Fixed 5.25 412 BBB Rated
CHAI 2015-PM3 A Consumer Prosper CHAI Citi 18-Dec-15 299.11 46.5% 161.5 0.78 Fixed 2.56 190 (P)A3 A+ Rated
CHAI 2015-PM3 B Consumer Prosper CHAI Citi 18-Dec-15 299.11 26.5% 59.8 2.2 Fixed 4.31 350 (P)Baa3 BBB+ Rated
CHAI 2015-PM3 C Consumer Prosper CHAI Citi 18-Dec-15 299.11 12.0% 43.4 3.37 Fixed 6.99 525 (P)Ba3 BB- Rated
MPLT 2015-CB2 A Consumer CircleBack MPLT Jefferies 15-Dec-15 151.20 22.0% 119.4 n/a Fixed 5.00 na
MPLT 2015-CB2 B Consumer CircleBack MPLT Jefferies 15-Dec-15 151.20 17.0% 7.6 n/a Fixed 6.50 na
AMPLT 2015-A A Consumer Avant AMPLT Avant 19-Nov-15 194.40 30.0% 136.1 1.07 Fixed 5.00 406
AMPLT 2015-A B Consumer Avant AMPLT Avant 19-Nov-15 194.40 20.0% 19.4 1.66 Fixed 6.75 581
AMPLT 2015-A C Consumer Avant AMPLT Avant 19-Nov-15 194.40 10.0% 19.4 1.66 Fixed 8.75 781
SOFI 2015-D A1 Student SoFi SOFI SoFi 18-Nov-15 573.04 27.0% 154.9 3.86 Floating 2.02 150 Aa2 AAA Rated
SOFI 2015-D A2 Student SoFi SOFI SoFi 18-Nov-15 573.04 58.4% 334.8 3.74 Fixed 2.72 150 Aa2 AAA Rated
SOFI 2015-D B Student SoFi SOFI SoFi 18-Nov-15 573.04 8.1% 46.7 4.64 Fixed 3.59 235 Baa2 BBBH Rated
MPLT 2015-LD1 A Consumer LoanDepot MPLT Jefferies 13-Nov-15 88.28 18.0% 123.0 1.74 Fixed 4.00 381
MPLT 2015-LD1 B Consumer LoanDepot MPLT Jefferies 13-Nov-15 88.28 13.0% 7.5 1.74 Fixed 6.00 506
MPLT 2015-LD1 C Consumer LoanDepot MPLT Jefferies 13-Nov-15 88.28 8.0% 7.5 1.74 Fixed 8.00 706
INSKT 2015-3 A Consumer Prosper INSKT Insikt 4-Nov-15 42.00 n/a 32.0 n/a Fixed 4.50 439
INSKT 2015-3 B Consumer Prosper INSKT Insikt 4-Nov-15 42.00 n/a 9.1 n/a Fixed 9.50 947
CHAI 2015-PM2 A Consumer Prosper CHAI Citi 23-Oct-15 419.76 45.0% 230.9 0.77 Fixed 2.35 195 A3 Rated
CHAI 2015-PM2 B Consumer Prosper CHAI Citi 23-Oct-15 419.76 24.5% 86.1 2.19 Fixed 4.00 275 Baa3 Rated
CHAI 2015-PM2 C Consumer Prosper CHAI Citi 23-Oct-15 419.76 10.5% 58.8 2.97 Fixed 5.96 450 Ba3 Rated

 

Ticker Type Originator Shelf Issuer Issue Date Collat Amt Credit Amt ($mm) Initial WAL Coupon Initial Est. Moodys S&P DBRS   Fitch Kroll Rated
($mm) Support (%) (yrs) Type Coupon Pricing
MPLT 2015-AV2 A Consumer Avant MPLT Jefferies 16-Oct-15 111.01 30.6% 86.3 n/a Fixed 4.00 351
MPLT 2015-AV2 B Consumer Avant MPLT Jefferies 16-Oct-15 111.01 20.7% 12.3 n/a Fixed 5.75 510
MPLT 2015-AV2 C Consumer Avant MPLT Jefferies 16-Oct-15 111.01 10.7% 12.3 n/a Fixed 7.50 685
MPLT 2015-AV1 A Consumer Avant MPLT Jefferies 24-Sep-15 126.52 30.1% 88.5 1.08 Fixed 4.00 316
MPLT 2015-AV1 B Consumer Avant MPLT Jefferies 24-Sep-15 126.52 20.1% 12.6 1.69 Fixed 5.75 495
MPLT 2015-AV1 C Consumer Avant MPLT Jefferies 24-Sep-15 126.52 10.1% 12.6 1.69 Fixed 7.50 670
MPLT 2015-OD3 A SME OnDeck MPLT Jefferies 15-Sep-15 79.63 19.7% 67.7 0.54 Fixed 3.25 281
MPLT 2015-OD3 B SME OnDeck MPLT Jefferies 15-Sep-15 79.63 10.2% 8.0 1.28 Fixed 5.25 na
AVNT 2015-A A Consumer Avant AVNT Avant 12-Aug-15 140.00 26.5% 108.4 1.09 Fixed 4.00 342
AVNT 2015-A B Consumer Avant AVNT Avant 12-Aug-15 140.00 16.0% 15.5 1.69 Fixed 6.00 521
AVNT 2015-A C Consumer Avant AVNT Avant 12-Aug-15 140.00 5.5% 15.5 1.69 Fixed 7.75 721
MPLT 2015-OD2 A SME OnDeck MPLT Jefferies 12-Aug-15 73.06 15.5% 59.0 0.42 Fixed 3.25 289
MPLT 2015-OD2 B SME OnDeck MPLT Jefferies 12-Aug-15 73.06 5.5% 6.9 0.97 Fixed 5.25 na
CHAI 2015-PM1 A Consumer Prosper CHAI Citi 5-Aug-15 420.90 46.0% 227.3 0.71 Fixed 1.85 140 A3 Rated
CHAI 2015-PM1 B Consumer Prosper CHAI Citi 5-Aug-15 420.90 25.5% 86.3 2.08 Fixed 2.93 200 Baa3 Rated
CHAI 2015-PM1 C Consumer Prosper CHAI Citi 5-Aug-15 420.90 10.5% 63.1 3.25 Fixed 5.01 385 Ba3 Rated
SOFI 2015-C A1 Student SoFi SOFI SoFi 4-Aug-15 447.56 30.5% 136.5 3.81 Floating 1.57 105 Aa2 AAA Rated
SOFI 2015-C A2 Student SoFi SOFI SoFi 4-Aug-15 447.56 56.0% 250.8 3.67 Fixed 2.51 98 Aa2 AAA Rated
SOFI 2015-C B Student SoFi SOFI SoFi 4-Aug-15 447.56 6.8% 30.3 5.41 Fixed 3.58 184 Baa2 BBBH Rated
INSKT 2015-2 A Consumer Prosper INSKT Insikt 10-Jul-15 4.50 n/a 3.6 n/a Fixed 4.50 438
INSKT 2015-2 B Consumer Prosper INSKT Insikt 10-Jul-15 4.50 n/a 0.8 n/a Fixed 9.50 946
CBSLT 2015-A A1 Student CommonBond CBSLT CommonBond 24-Jun-15 105.00 91.8% 96.4 n/a Fixed 3.20 165 Baa2 AH Rated
SOFI 2015-B A1 Student SoFi SOFI SoFi 9-Jun-15 441.18 33.2% 146.7 3.75 Floating 1.57 105 Aa3 A AAH Rated
SOFI 2015-B A2 Student SoFi SOFI SoFi 9-Jun-15 441.18 53.4% 235.4 3.59 Fixed 2.51 105 Aa2 A AAH Rated
SOFI 2015-B B Student SoFi SOFI SoFi 9-Jun-15 441.18 6.8% 29.8 5.14 Fixed 3.52 165 Baa3 BBB Rated
MPLT 2015-OD1 A SME OnDeck MPLT Jefferies 4-Jun-15 52.08 15.0% 44.3 0.58 Fixed 3.25 266
MPLT 2015-OD1 B SME OnDeck MPLT Jefferies 4-Jun-15 52.08 5.0% 5.2 1.19 Fixed 5.25 na
MPLT 2015-CB1 A Consumer CircleBack MPLT Jefferies 3-Jun-15 110.06 22.0% 99.9 n/a Fixed 4.00 312
MPLT 2015-CB1 B Consumer CircleBack MPLT Jefferies 3-Jun-15 110.06 17.0% 6.3 n/a Fixed 6.00 511
ECLT 2014-1 A Consumer Lending Club ECLT Eaglewood 1-May-15 150.00 n/a 120.0 2.25 Fixed 3.50 260
ECLT 2014-1 B Consumer Lending Club ECLT Eaglewood 1-May-15 150.00 n/a 22.5 2.54 Fixed 5.33 429
INSKT 2015-1 A Consumer Prosper INSKT Insikt 31-Mar-15 4.31 n/a 3.7 n/a Fixed 4.00 396
BLT 2015-1 A Consumer Prosper BLT Blue Elephant 25-Mar-15 60.90 n/a 55.0 0.96 Fixed 3.12 275
BLT 2015-1 B Consumer Prosper BLT Blue Elephant 25-Mar-15 60.90 n/a 8.9 2.56 Fixed 5.56 475
BLT 2015-1 C Consumer Prosper BLT Blue Elephant 25-Mar-15 60.90 n/a 3.6 n/a Fixed 0.00 n/a
GLCT 2015-A A Consumer Prosper GLCT Garrison 2-Mar-15 190.26 n/a 154.1 1.52 Fixed 3.96 324
GLCT 2015-A B Consumer Prosper GLCT Garrison 2-Mar-15 190.26 n/a 9.4 1.52 Fixed 5.43 472
GLCT 2015-B A Consumer Prosper GLCT Garrison 2-Mar-15 120.58 n/a 97.4 1.52 Fixed 3.96 324
GLCT 2015-B B Consumer Prosper GLCT Garrison 2-Mar-15 120.58 n/a 5.9 1.52 Fixed 5.43 472
CCOLT 2015-1 A Consumer Prosper CCOLT BlackRock 9-Feb-15 306.71 23.5% 281.3 1.05 Fixed 2.82 240 Baa3 Rated
CCOLT 2015-1 B Consumer Prosper CCOLT BlackRock 9-Feb-15 306.71 11.0% 45.4 2.86 Fixed 5.21 395 Ba3 Rated
SOFI 2015-A A1 Student SoFi SOFI SoFi 29-Jan-15 313.80 n/a 151.5 3.89 Floating 1.72 125 A2 A AA Rated
SOFI 2015-A A2 Student SoFi SOFI SoFi 29-Jan-15 313.80 n/a 162.3 3.47 Fixed 2.42 125 A2 A AA Rated
GLCII 2014-A A Consumer Lending Club GLCII Garrison 29-Dec-14 153.00 n/a 109.8 1.35 Fixed 4.00 355
GLCII 2014-A B Consumer Lending Club GLCII Garrison 29-Dec-14 153.00 n/a 9.5 1.35 Fixed 6.00 555
INSKT 2014-2 A Consumer Prosper INSKT Insikt 22-Dec-14 7.50 n/a 7.1 n/a Fixed 4.00 396
INSKT 2014-2 B Consumer Prosper INSKT Insikt 22-Dec-14 7.50 n/a 0.6 n/a Fixed 9.00 895
SOFI 2014-B A1 Student SoFi SOFI SoFi 10-Nov-14 303.20 n/a 105.7 3.89 Floating 1.77 125 A2 A AAL Rated
SOFI 2014-B A2 Student SoFi SOFI SoFi 10-Nov-14 303.20 n/a 197.5 3.3 Fixed 2.55 130 A2 A AAL Rated
CANF 2014-1A A SME CAN Capital CANF CAN Capital 17-Oct-14 200.02 n/a 171.0 2.9 Fixed 3.12 210 A A Rated
CANF 2014-1A B SME CAN Capital CANF CAN Capital 17-Oct-14 200.02 n/a 20.0 3.4 Fixed 4.26 221 BBB- BBBL Rated
KABB 2014-1RT A22 SME Kabbage KABB Kabbage 25-Sep-14 n/a n/a 575.3 2.56 Floating 3.27 209 A- Rated
KABB 2014-1RT B2A SME Kabbage KABB Kabbage 25-Sep-14 n/a n/a 168.6 2.56 Floating 10.52 907 BB- Rated
KABB 2014-1RT B2B SME Kabbage KABB Kabbage 25-Sep-14 n/a n/a 0.0 2.56 Fixed 3.00 192 BB- Rated
KABB 2014-1RT B2C SME Kabbage KABB Kabbage 25-Sep-14 n/a n/a 21.1 2.56 Floating 13.52 1,234 B+ Rated
GARST 2014-A A Consumer Prosper GARST Garrison 18-Jul-14 45.54 n/a 36.9 1.52 Fixed 3.00 233
GARST 2014-A B Consumer Prosper GARST Garrison 18-Jul-14 45.54 n/a 2.3 1.52 Fixed 4.00 333
SOFI 2014-A A1 Student SoFi SOFI SoFi 14-Jul-14 280.69 n/a 125.5 3.69 Floating 2.12 160 A A Rated
SOFI 2014-A A2 Student SoFi SOFI SoFi 14-Jul-14 280.69 n/a 125.5 3.72 Fixed 3.02 165 A A Rated

 

Ticker Type Originator Shelf Issuer Issue Date Collat Amt Credit Amt ($mm) Initial WAL Coupon Initial Est. Moodys   S&P DBRS   Fitch    Kroll Rated
($mm) Support (%) (yrs) Type Coupon Pricing
GLCT 2014-A A Consumer Prosper GLCT Garrison 2-Jul-14 169.21 n/a 147.6 1.53 Fixed 3.00 253
GLCT 2014-A B Consumer Prosper GLCT Garrison 2-Jul-14 169.21 n/a 9.0 1.53 Fixed 4.00 353
INSKT 2014-1 A Consumer Prosper INSKT Insikt 28-May-14 n/a n/a 7.1 n/a Fixed 3.50 345
ONDK 2014-1A A SME OnDeck ONDK OnDeck 8-May-14 183.20 n/a 156.7 2.32 Fixed 3.15 250 BBB Rated
ONDK 2014-1A B SME OnDeck ONDK OnDeck 8-May-14 183.20 n/a 18.3 2.8 Fixed 5.68 477 BB Rated
SOFI 2013-A A Student SoFi SOFI SoFi 23-Dec-13 151.80 n/a 151.8 4.35 Fixed 3.75 245 A Rated
INSKT 2013-2 A Consumer Prosper INSKT Insikt 17-Dec-13 n/a n/a 2.6 n/a Fixed 4.25 421
INSKT 2013-2 B Consumer Prosper INSKT Insikt 17-Dec-13 n/a n/a 0.6 n/a Fixed 11.00 1,096
INSKT 2013-1 A Consumer Prosper INSKT Insikt 4-Oct-13 1.57 n/a 1.1 n/a Fixed 4.50 444
INSKT 2013-1 B Consumer Prosper INSKT Insikt 4-Oct-13 1.57 n/a 0.3 n/a Fixed 12.00 1,197
ECLT 2013-1 A Consumer Lending Club ECLT Eaglewood 26-Sep-13 100.00 n/a 75.0 2.37 Fixed 4.30 371
ECLT 2013-1 B Consumer Lending Club ECLT Eaglewood 26-Sep-13 100.00 n/a 24.0 2.44 Fixed 8.00 739

About the author: PeerIQ offers portfolio monitoring and loan surveillance, structured finance analytics, third-party reporting, pricing and valuation and advisory services across both whole loans and ABS products.

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