News
LendingClub’s Structured Certificate Program Surpasses $3 Billion Sold
loan club has sold more than $3 billion in loans through its Structured LendingClub Loan Certificate program since that program launched in April 2023.
In this program, LendingClub retains the senior note and sells the residual certificate of a pool of loans to a market investor at a predetermined price, the company said on Monday (June 17). Press release.
“Our structured certificates program is gaining strong traction among our loan investors because they recognize the value of consumer credit as an asset class, the quality of our underwriting and our simplified financing solutions,” Scott Sanborn, CEO of LendingClub, said in the release. “The success of this program, which is exclusive to us, is another indicator of our status as the provider of choice in this asset class.”
The program offers market investors “risk-adjusted leveraged returns with low friction and low-cost financing in a liquid security” while allowing LendingClub to earn an attractive yield with remote credit risk, according to the release.
The structured certificate program is the latest addition to the product structures offered by LendingClub to expand investor access to consumer credit, broaden distribution and improve liquidity for investors, according to the release.
“As an industry leader, we have a substantially lower default history compared to our competitive set, which is critical to generating solid returns for ourselves and our market investors,” Sanborn said in the release. “This superior performance resulted in existing partners renewing their commitments and bringing new investors to the LendingClub platform.”
LendingClub surpassed the $1 billion mark in personal loans sold through the structured certificate program in November 2023, seven months after the program launch.
The program experienced rapid expansion and attracted new investors to the LendingClub platform, the company said at the time.
O structured certificate program It is also among the new structures built by LendingClub to serve both asset managers and LendingClub at times when loan originations drop, Sanborn said in October 2023 during a quarterly earnings call.
“Another advantage of our bank is our ability to maintain and make loans to investors, earning interest income for LendingClub and increasing certainty about future credit performance for the buyer, which is especially important in this environment,” said Sanborn .