J.P. Morgan Acquires Nearly $1 Billion Worth of Lending Club Loans -- Sources
February 01 2016 - 12:06PM
Dow Jones News
By Telis Demos
J.P. Morgan Chase & Co. has agreed to acquire nearly $1
billion worth of personal loans arranged by LendingClub Corp.,
according to people familiar with the deal.
The portfolio, worth just over $900 million and comprising loans
made to consumers with an average FICO score of about 700, was sold
for a premium to the outstanding balance on the loans, one of the
people said.
The sale was being closely watched by credit markets as an
indicator of the health of the market for online personal
loans.
The loans had been owned by Santander Consumer USA Holdings
Inc., the subprime auto lender, which had acquired them as part of
an agreement with Lending Club. But last year, Santander Consumer
decided to scale back its personal loan business and initiated a
sale of the portfolio.
There had been some concern that the value of the loans had
diminished following Santander Consumer's markdown last week of
some loans it held for sale, which could indicate that fewer
borrowers were paying back their loans than expected. But the
markdown hadn't affected the Lending Club loans, people familiar
with the matter said.
A premium sale is generally considered a positive indicator for
the loans.
Write to Telis Demos at telis.demos@wsj.com
(END) Dow Jones Newswires
February 01, 2016 11:51 ET (16:51 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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