LendingClub’s Structured Certificates Program Surpasses $3 Billion in Loans Sold

LendingClub has sold more than $3 billion in loans through its Structured LendingClub Loan Certificate program since the launch of that program in April 2023.

In this program, LendingClub retains the senior note and sells the residual certificate on a pool of loans to a marketplace investor at a predetermined price, the company said in a Monday (June 17) press release .

“Our structured certificates program is gaining strong momentum among our loan investors because they recognize the value of consumer credit as an asset class, the quality of our underwriting and our streamlined financing solutions,” Scott Sanborn , CEO at LendingClub, said in the release. “The success of this program, which is unique to us, is another indicator of our status as a provider of choice in this asset class.”

The program offers marketplace investors “compelling risk-adjusted levered returns with low-friction and low-cost financing on a liquid security,” while enabling LendingClub to earn an attractive yield with remote credit risk, according to the release.

The structured certificates 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, per the release.

“As the industry leader, we have a track record of substantially lower delinquencies compared to our competitive set, which is key to delivering strong returns for ourselves and our marketplace investors,” Sanborn said in the release. “That outperformance has resulted in existing partners renewing their commitments, and new investors coming to the LendingClub platform.”

LendingClub crossed the $1 billion mark in personal loans sold through the structured certificates program in November 2023, seven months after the program’s launch.

The program experienced rapid expansion and attracted new investors to the LendingClub platform, the firm said at the time.

The structured certificates program is also among the new structures built by LendingClub to serve both asset managers and LendingClub at times when loan originations dip, Sanborn said in October 2023 during a quarterly earnings call.

“Another advantage of our bank is our ability to hold and season loans for investors, earning interest income for LendingClub while increasing the certainty around future credit performance for the buyer, which is especially important in this environment,” Sanborn said.