Lending Club has closed five of its investment funds under LC Advisors; the loans have been sold off to various buyers and the company has rebranded its investment management business to LendingClub Asset Management. Source
In its annual banking report McKinsey & Co. said there is the potential for 40 percent of revenues that could be at risk by 2025 from firms like Amazon entering the space; Asheet Mehta, one of the authors of the McKinsey report, said in an interview reported by American Banker "E-commerce and tech giants are under pressure to keep increasing revenue, and financial services is a large pool they can go after. We're starting to see that." Source.
- Finn.ai Raises $3 Million in Institutional Financing Round
- Digital bank for teenagers raises $5m in Series A investment round
- Italian peer-to-peer lender launches its own fund, targets €100m raise
- Templum Raises $2.7M in Seed Funding
- Canadian Lenders Association & Innovative Lending Platform Association Launch Smart Box in Canada
- Starqrmarq wins peer to peer lending brief
- State of Small Business Lending: 2017 Spotlight on Women Entrepreneurs
Monja shares a list of online lenders in the real estate space; discusses the pull back in construction financing by traditional banks and the continuing rise overall in the real estate construction sector. Source
J.D. Power is out with their most recent Small Business Banking Satisfaction Study and small businesses are still dissatisfied with banks; the biggest issue that could increase positive interaction with small businesses and banks is more account representatives; having someone available to speak to SMBs and help them is something that is sorely lacking; banks have seen market share go to fintechs and digital banks in recent years so better serving this key customer group is something the banks need to recognize. Source.
CommonBond closed their fifth and largest securitization which contained $248 million of refinanced student loans; the senior tranches were rated by Moody’s, S&P and DBRS and received ratings of Aa2, AA and AA (high) respectively; the deal was four times oversubscribed; according to David Klein, CommonBond CEO and co-founder, “Investor demand for CommonBond paper has never been greater. The strong market reception is a reflection of our pristine credit quality, continued ratings progression, and track record of consistent results. As a programmatic issuer, we look forward to continuing to bring consistently high performing bonds to the market, providing investors with world-class capital deployment options.” Source
Jeff Garzik helped contribute to the underlying code of bitcoin and is now coming to market with Metronome; "We've really been beating this up on the economic-model side, the engineering side, the legal and tax side," said Garzik, who serves as CEO of Bloq, to American Banker; Metronome does not have it’s own blockchain and has the ability to jump from one blockchain to another; the new cryptocurrency could be appealing to banks because of the flexibility and they are looking to launch in December. Source.
Orchard stresses the importance of recovery rates in valuing pools of loans; blog post takes Orchard’s US unsecured consumer lending industry data and discusses what loan recoveries are, how they are calculated, how debt holders recover defaulted loan balances, and why recovery rates are so important. Source
Speaking at the Financial Investment Initiative event the former founder of PayPal thinks that bitcoin detractors could be underestimating the currency’s potential; as CoinDesk reports, “underestimating [it] especially because ... it's like a reserve form of money, it's like gold, and it's just a store of value. You don't need to use it to make payments."; he has in the past criticized bitcoin and is not bullish on all cryptocurrencies. Source.
After raising more than $232mn in an initial coin offering the company is now involved in a legal battle that could delay the launch into 2018; the dispute highlights the risk involved in the new form of financing since companies are raising money from a concept; how the case turns out could potentially effect future fundraising and whether or not investors feel secure enough to pour capital into young companies. Source.