Penny Crosman takes a deep dive into the big news story of the week with analysis of the pending LendingClub acquisition of Radius Bank; she talked with LendingClub president, Steve Allocca, who said the deal was about far more than just obtaining a cheaper source of capital for its loans; Allocca said, “It’s definitely a mix. Deposits absolutely are a source of lower-cost funding that allows us to offer lower rates to borrowers and also stabilizes the model. We’re probably the only company in the lending space that’s gone from originally 100% retail funding, peer-to-peer, to almost entirely wholesale funding. This [merger] brings back a more appropriate, more sustainable balance and allows us to pass through more benefits to consumers.” LendingClub plans to launch a bank account later this year to help their customers build up savings; more than 50,000 customers a day apply for a loan at LendingClub today. American Banker
