MonJa Monthly News Update- February 2016

In Industry News by Kitty LinLeave a Comment

Here are some of the top stories and trends of February 2016 for marketplace lending investors and industry watchers:

Industry News:

02-03-2016– FDIC Puts Up More Road Blocks for Marketplace Lenders  (Pepper Hamilton LLP) Based on the FDIC’s latest insights on marketplace lending, Pepper Hamilton summarizes specific risks that banks need to examine when dealing with marketplace lenders.

02-05-2016– Misconceptions about Online Lending (The Hill) Written by Al Goldstein of Avant, the article evaluates misconceptions in marketplace lending, such as how online lending is unregulated and less advantageous for borrowers.

02-08-2016– A Look at the Marketplace Lending Ecosystem (TechCrunch)– In this analysis on the marketplace lending business model, competitive pricing, customer experience, and scale are key elements of an originator’s success.  

02-12-2016– Quarterly Report on Household Debt and Credit (FRBNY)—Few takeaways: Household debt increased 0.4% ($51 billion increase) from Q3Y2015. Student loan balances increased by $29 billion. Credit card balances increased by $19 billion, to $733 billion.

02-15-2016–Is The Tide Going Out for Marketplace Lending? (pyments.com)

02-17-2016– How to Understand and Partner with Marketplace Lenders (Banking Journal)– Banks don’t have to lose small business loans. Whether it’s a “white label” partnership or referral agreements, here are are some ways banks are partnering with marketplace lenders.

02-22-2016–The Online Lending Market Might Be Telling Us Something Troubling about the US Economy (Business Insider)

02-25-2016–Marketplace Lending’s Big Investors Grow Anxious (American Banker)

02-26-2016–US Online Lending is Deteriorating, Here is the Data (FT Alphaville)– Is credit quality deteriorating? MonJa provided some insights to this. While loan grades A-D show consistent behavior, the performance of lower grade loans in previous vintages may indicate a potential ramp in losses in Q3 and Q4 of 2015. Take a look of the data here.


 

Platform News:

02-01-2016– JP Morgan acquires $900mm of Lending Club Loans (WSJ)

02-03-2016– Credibly Secures $70 Million Credit Facility (Crowdfund Insider)

02-04-2016– Lending Club Models Misfire as Loan Write-offs Exceed Forecasts (Bloomberg)–This initial Bloomberg piece created a mini panic among investors by stating that write off rates were 7-8% compared to the forecasted 4-6%. Lending Club responded by publishing a credit performance update to emphasize that the overall loan performance, including underperforming segments fall within expectations. That being said, MonJa has also published an analysis on a deeper look of Lending Club’s underwriting performance.

02-06-2016– P2P Lender Dianrong Launches Partnership with Hanwha (Crowdfund Insider)

02-08-2016– Kroll Bond Assigns Preliminary Ratings to Avant Loans (BusinessWire)

02-10-2016– Patch of Land Secures $250mm from East Coast Fund (Crowdfund Insider)

02-11-2016– Moody’s Places Prosper Class C Notes for Possible Downgrade (Moody’s)– While Moody’s upgrades CCOLT 2015 Class A and Class B notes, CHAI 2015 Class C Notes are under review for a possible downgrade. In response, MonJa published a post analyzing Prosper’s delinquency curves and to clarify that the performance is consistent.

02-17-2016– Prosper Raises Rates on Consumer Loans (Crowdfund Insider)

02-22-2015– OnDeck Releases Q4 and Full Year 2015 Financial Results (PR Newswire)

02-25-2016– East Coast PE Firm to Purchase $60mm Sharestates Loans (Crowdfund Insider)

02-26-2016– Lending Club Shifts Risk Ahead of Court Ruling (MarketWatch)

 

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