Lending Club, the largest alternative financing provider in the US, announced it has secured $1.3 billion to be lent through its platform by the National Bank of Canada in the next 12 months.
The investment will be undertaken by Credigy the US subsidiary of the bank, which specializes in consumer finance investment.
“We’re pleased to add this platform purchase program with Credigy to our investor capital mix. As we take multiple strategic actions to enhance our marketplace, we see the Credigy program as a way we’re further diversifying our investor base and adding the funding visibility and stability that can make us even more resilient in various market conditions,” said Scott Sanborn, President and CEO at Lending Club.
“Lending Club is a clear leader in delivering access to unsecured consumer credit. Based on Lending Club’s track record of loan performance and our extensive review, we are excited to establish this purchase program and invest on the platform,” said Brett Samsky, CEO of Credigy.
Meanwhile, Lending Club reported a net loss of $113.7 million for the first nine months of 2016 and a net loss of $36.5 million for the third quarter. This includes $1.7 million of goodwill impairment in the quarter ended September 30, 2016 and $37.1 million year to date in 2016.
At the same time in Q3 the loan originations rose 1% over the quarter, to $1.97 billion, but fell 12% on an annual basis.
Since its founding in 2006 Lending Club has facilitated near $23 billion (as of end of September) in P2P loans and manages a servicing portfolio of nearly $10.9 billion. This is 42% higher compared to the $7.7 billion at the end of the same period last year.
The National Bank of Canada is the sixth largest commercial bank in the country and is based in Montreal. It has 2.4 million private clients and ranks among the strongest banks in the world, according to Bloomberg.