Securitizations Securing the Future
As we near year’s end, we’re excited to announce that LendingClub has closed its third self-sponsored securitization. The $330 million transaction saw immediate traction and has further increased access to consumer credit for the stable and scalable pool of investor capital in the liquid Asset-Backed Securities (ABS) investor market.
This securitization provides incremental revenue and continues to set the stage for growth for the company as we head into 2018. Of note, with 48 total securitization investors this year, over two-thirds (34) are new to LendingClub, including insurance companies, hedge funds, a bank and a pension fund.
Investor interest from very large, established institutions shows the broad appeal of the consumer credit asset, underscores its maturity, and indicates the potential to scale and continue to grow the platform.
Having previously supported securitizations, we kicked off our self-sponsored securitization program in June of this year, closed a second deal in September and have just completed our third self-sponsored securitization (Consumer Loan Underlying Bond (CLUB) Credit Trust 2017-P2 [CLUB 2017-P2]), acting as sponsor, servicer, administrator and a contributor of the loans. The transaction was rated by Kroll Bond Rating Agency, Inc. and includes:
- $239.4MM of Class A notes [rated A- (sf)]
- $34.6MM of Class B notes [rated BBB (sf)]
- $56.0MM of Class C notes [rated BB (sf)]
The notes are backed by approximately $368.0 million in collateral, with J.P. Morgan and Citigroup serving as lead underwriters. BNP Paribas was a co-manager.
Our self-sponsored securitizations have also broadened brand awareness for LendingClub among new institutional investors, and are an efficient use of our resources, as they created a potentially repeatable process with fixed or reduced costs.
These LendingClub self-sponsored securitizations provide unprecedented consistency of access to our assets—with enhanced liquidity, a standardized deal process and greater transparency. They also demonstrate that we’ve got skin in the game, because we own a percentage of each transaction.
Our investors’ win is our borrowers’ win is LendingClub’s win. It’s that connected value proposition that makes this marketplace great.