Record week for marketplace lending securitisation tops $1.2bn

By Daniel Lanyon on 22nd May 2017

P2P/Marketplace LendingAlternative Credit

Three firm’s latest round of ABS has set a new high in the increasing trend for securitised pool of loans originated by online lenders.

Record week for marketplace lending securitisation tops $1.2bn

Three firm’s latest round of ABS has set a new high in the increasing trend for securitised pool of loans originated by online lenders.

Last week saw the largest issuance of marketplace lending securitizations in the history of the nascent asset class with transactions totalling more than $1.23bn.

The trio of transactions priced last week came from three separate US issuers. These were student loan platform SoFi (SoFi 2017-C), and the second largest US platform by lending volumes Prosper (PMIT 2017-1), as well another student lender Earnest (EARN 2017-A).

Securitization is still a relatively new trend within marketplace lending but an uptick in issuance in recent months seems to suggest an increase in investor demand for bonds backed by consumer loans.

Prosper’s $450m tranche is its sixth and just the start of an overall $5bn deal backed by a slew of institutional investors including George Soros’ hedge fund as well Credit Suisse

Standard and Poor’s, the ratings agency, says The SoFi pool consists of approximately $599. 8m in private student loans. This includes the principal plus accrued interest to be capitalized. Earnest’s contribution to the market-record totalled nearly $185m.

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