Feb 11th 2016 News Digest

Feb 11th 2016
Title Description Interest level Publication
LendingClub (LC) Tops Q4 Earnings; Rises 2016 Outlook LendingClub came out with adjusted earnings (including stock based compensation) of 2 cents per share. The Zacks Consensus Estimate for the quarter was at the break-even level. Drastic improvement in revenues was mainly responsible for earnings growth. The stock has a market capitalization of $2.48 billion. AAA Zacks
Lending Club Reports Fourth Quarter and Full Year 2015 Results and Announces $150 Million Share Buyback "Our confidence is bolstered again by Lending Club's performance in 2015 and causes us to raise our outlook for 2016," said Lending Club founder and CEO Renaud Laplanche. "We have earned the trust of 1.4 million customers, have considerable room to grow our existing products, and intend to continue to expand both our product line and addressable population going forward. Our operating efficiency reached record levels in Q4, and our credit performance, marketing efficiency and customer satisfaction remain very strong. Accordingly, we are raising Lending Club's 2016 revenue guidance to $730 to $740 million, or 72 percent top line growth, and adjusted EBITDA guidance to $130 to $145 million. We believe there is tremendous long term potential that is not reflected in Lending Club shares and so we are taking this opportunity to use a small portion of our cash to buy back up to $150 million worth of our stock." AAA PR Newswire
LendingClub shares jump 7% after earnings beat, news of share buyback Looking ahead, the company is expecting first-quarter operating revenue to range from $147 million to $149 million, compared with a current FactSet consensus of $145 million. Shares have fallen 70.6% in the last 12 months, while the S&P 500 has lost about 10%. A Market Watch
Former FSA Chair Lord Adair Turner Warns About Peer to Peer Lending. Industry Leaders Disagree Lord Turner named Lord Gloom and Doom. “Anyone who has followed our industry closely will see that this morning’s comments fly in the face of the evidence. Since the industry began, default on loans are low, measuring between 2-3 per cent. We only lend to creditworthy consumers and established small and medium-sized enterprises. Strict credit underwriting rules apply to all our members and this should not be confused with higher risk forms of crowdfunding or lending to sub-prime customers. All members of the P2PFA operate with high standards of transparency and business conduct. AAA Crowdfund Insider
Why P2P lending is getting ever more robust – and why Adair Turner is wrong about the industry The biggest, I think, will be the realisation that we, the P2P lenders, and them, the banks, are friends and can and should work alongside each other. We’ve known it for a long time, but the banks have been slow to realise. Simply put, P2P lenders are more flexible and can facilitate lending that the banks can’t. Meanwhile, the banks offer a range of services that platforms don’t and don’t want to provide, but which can be provided alongside the loans the latter facilitate. A City AM
P2P lending platform Bondora opens API A publicly open API makes it possible to create a truly connected eco-system where numerous 3rd party services are built on a single marketplace. This will result in an increased quality of the P2P lending industry and Bondora as a whole. B Finextra
Are you smarter than a banker? (hint - almost certainly) Basic p2p info B Mirror
Latvian Marketplace Lender Twino is Not Magic, It is Reselling Short Term Consumer loans “Twino will buy back any non performing loan after a 30 day period of delinquency.” As a subsidiary of a larger, innovative consumer lender called Finabay, Twino resells to investors part of the loans vetted and granted by Finabay at short term loan rates. Investors can buy a portfolio of these loans, either by handpicking them or by using Twino’s automated allocation. The loans themselves are fully risk assessed and accordingly priced by the mother company’s consumer credit operations that operate locally in Poland, Denmark and Georgia. Once Finabay resells loans, these are taken off their books at a profit. If the investor wants to withdraw because the repayment is delayed by 30 days or more, the company can afford to take these loans back to its books because their default has been provisioned from the start. AAA Crowdfund Insider
Zopa Preps for Innovative Finance ISA The godfather of peer to peer lending Zopa, has published some information on the forthcoming Innovative Finance ISA. A Crowdfund Insider
To P2P or not to P2P? ArchOver, SME lender, has teamed up with COFACE, a leading global credit insurer and an acknowledged expert in international trade risk, to create future protection of up to £100 million that will reduce the cost of credit insurance for the borrowing company significantly. A Spear's
IFISA falls short of expectation The legislation is crippled by the stipulation that investors may only invest in an IFISA directly through P2P platforms. This restricts investors from participating via their existing ISA managers. Worse still, investments can only be made through a single provider and not across multiple platforms. AAA Financial Reporter
Real Estate Marketplace Lending Gets Institutional Stamp of Approval Institutional forward flow agreements, such as the one announced by Patch of Land, show that the data-driven models being applied by real estate marketplace lenders instill confidence in the products offered, in the company, and in the future of this fast-growing industry. A Equities
Capitalise marketplace uses behavioural analytics to increase lending to small businesses Capitalise launches today - the first online marketplace that uses behavioural analytics to intelligently match lenders with SMEs seeking finance. A Finextra
Industry Veteran Brings Rock Solid Experience to New Middle-Market Venture In the final weeks of 2015, the industry learned that commercial finance veteran, Stuart Armstrong, had partnered with Two Sigma Private Investments to form Great Rock Capital Partners. Serving as this new venture’s CEO and CIO, Armstrong seeks to take advantage of the investment opportunities available in the middle market by drawing on his years of commercial finance experience and deep industry relationships. A ABL Advisor

Lending Club adjusted earnings higher then expected. Announce $150m stock buy back. Continues fast growth. Lord Doom and Gloom ( Lord Turner) is wrong based on fundamentals. “Twino will buy back any non performing loan”. Limits in P2P ISA.

Author : George Popescu

About the author

George Popescu

Serial entrepreneur.

George sold and exited his most successful company, Boston Technologies (BT) group, in 2014. BT was a technology, market maker, high-frequency trading and inter-broker broker-dealer in the FX Spot, precious metals and CFDs space company. George was the Founder and CEO and he boot-strapped from $0 to a $20+ million in revenue without any equity investment. BT has been #1 fastest growing company in Boston in 2011 according to the Boston Business Journal and the only company being in top 10 fastest in 2012-13 as it was #5 in 2012. BT has been on the Inc. 500/5000 list of fastest growing companies in the US for 4 years in a row ( #143, #373, #897 and #1270). After the company sale in July 2014 until February 2015 George was Head-of-Strategy for Currency Mountain ( ), a USD 100 million+ holding company focused on retail and medium institutional currencies, precious metals, stocks, fixed income and commodities businesses.

• Over the last 10 years, George founded 10 companies in online lending, craft beer brewery, exotic sports car rental space, hedge funds, peer-reviewed scientific journal ( Journal of Cellular and Molecular medicine…) and more. George advised 30+ early stage start-ups in different fields. George was also a mentor at MIT’s Venture Mentoring Services and Techstar Fintech in NY.

• Previously George obtained 3 Master's Degrees: a Master's of Science from MIT working on 3D printing, a Master’s in Electrical Engineering and Computer Science from Supelec, France and a Master's in Nanosciences from Paris XI University. Previously he worked as a visiting scientist at MIT in Bio-engineering for 2 years. George had 3 undergrad majors: Maths, Physics and Chemistry. His scientific career led to about 10 publications and patents.

• On the business side, Boston Business Journal has named me in the top 40 under 40 in 2012 in recognition of his business achievements.

• George is originally from Romania and grew up in Paris, France.

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