Pepper Hamilton will be hosting a webinar on Tuesday, January 24 at 12:00 PM EST providing insight on the considerations for fintech companies interested in applying for the new fintech charter; topics will include fintech charter advantages, the application process, OCC requirements, OCC oversight and capital requirements; the panel will include Pepper Hamilton lawyers with OCC experience; participants can register here.
Estimated return for December 2016 production is 6.45%; PMI7, Prosper's underwriting model, was put in place late December, 2016; models are updated every 12 to 18 months; average FICO was higher than lows in 2015 and 2016 but is expected to decrease with an increase in lower grade loans as a result of the new credit risk model; prepayment rates increased and delinquency rates were lower; cumulative gross charge offs have increased but are expected to trend lower. Source
Lend Academy provides details on how marketplace loans are performing at Lending Club and Prosper; delinquency rates have been increasing since the third quarter of 2014; less risky loan grades have continued to report the best performance; lower quality loans have suffered increased degradation specifically since the third quarter of 2014; Prosper has made fewer interest rate changes than Lending Club and it seems its higher risk loans are performing slightly better; Lending Club announced additional changes to the platform on January 18th. Source
OnDeck has announced a new partnership with Wex that will provide credit financing options for Wex's customers; Wex currently provides payment solutions and credit services for corporations and small businesses; the partnership will offer OnDeck's loans of up to $500,000 and credit lines of up to $100,000 for Wex's customers. Source
Credible is one of the success stories in online lending today. The leading online exchange for student loans has just closed their $10 million Series B funding round that we have been told was "a significant up round." Australian fund manager Regal Funds Management led the round that also included Prosper President Ron Suber. Credible doesn't lend money itself. Instead, it has deep integrations with many of their lending partners (such as CommonBond and College Ave) allowing borrowers not only to compare interest rates but to only see those rates with a high likelihood of approval. Source
BorrowersFirst has secured $100 million in new debt funding from Waterfall Asset Management; firm will use the funding primarily to support lending volume growth for its online consumer loan business; firm funds its loans through on-balance sheet debt facilities and whole loan sales with originations by Cross River Bank. Source
Since launching in 2015, Sharestates, a real estate crowdfunding company, has crossed $275 million in originations across 323 loans; in December 2016 the company originated $42 million, nearly doubling total loan volume in just over three months; average net yield to investors has been 11%; Sharestates recently announced they were raising their Series A through SeedInvest; the company is currently profitable and was previously a finalist for PitchIt@LendIt. Source
The online lender is now able to originate mortgages in 27 states, with hopes of expanding to all 50 soon; included in their announcement about the New York license was overall originations reached $1 billion in December, $100 million of which were mortgages; SoFi Chief Revenue Officer Michael Tannenbaum said, "The plan is to continue to roll out a state licensing strategy, our licensing strategy mirrored places where there were large jumbo balances."; SoFi also believes their cross buying strategy and the $1 billion infusion from SoftBank has helped them weather the storm of the last year; in a separate announcement, the online lender has moved their office to 860 Washington Street in New York's Meatpacking District. Source
CAN Capital Inc. has hired an advisor to help the business after halting loan originations and releasing senior executives; Realization Services Inc. has been hired to help the firm negotiate with creditors and strategy investment banking advisor Jefferies; CAN Capital has been lending to small businesses since 1998 with $6.5 billion in loans and cash advances; near the end of 2016 the firm reported data irregularities and issues with loan performance and collections. Source
In June 2016 the White House held the White House FinTech Summit for regulators and industry stakeholders; on January 13 the White House published a white paper on its principles titled, "A Framework for FinTech"; the paper outlines government policy objectives for fintech as well as ten principles; the white paper also outlines agency actions to date. Source