Net Income of $13.7M, Driven by 7% Sequential Increase in
Pre-Provision Net Revenue (PPNR)
Deposits Up 13% Sequentially to $7.2B; $1.6B in
Cash
SAN
FRANCISCO, April 26, 2023 /PRNewswire/ -- LendingClub
Corporation (NYSE: LC), the parent company of LendingClub Bank,
America's leading digital marketplace bank, today announced
financial results for the first quarter ended March 31,
2023.
"We delivered a solid quarter driven by our strategic
advantages, including over 15 years of cycle-tested data,
prudent and agile underwriting, and our digital marketplace bank
model," said Scott Sanborn,
LendingClub CEO. "While we expect continued industry and macro
headwinds, these significant advantages, along with our growing
online consumer deposit franchise and high-yielding short duration
assets, provide us with a range of options to navigate the current
macro environment while we build toward an ambitious future for the
company and our growing membership base."
First Quarter 2023 Results
Balance Sheet:
- Total assets grew 10% sequentially to $8.8 billion from $8.0
billion at December 31,
2022.
- Deposits up 13% sequentially to $7.2
billion; FDIC-insured deposits represent approximately 86%
of total deposits.
-
- Cash of $1.6 billion increased
55% from December 31, 2022.
- Available aggregate borrowing capacity of $4.1 billion as of April
26, 2023.
- Loans and leases held for investment portfolio grew 4.6%
sequentially from $5.6 billion to
$5.9 billion.
- Substantial capital with a consolidated Tier 1 leverage ratio
of 12.8% and consolidated Common Equity Tier 1 capital ratio of
15.6%.
- Book value per common share of $11.08, up 1.4% from $10.93 at December 31,
2022.
- Tangible book value per common share of $10.23, up 1.7% from $10.06 at December 31,
2022.
Financial Performance:
- Loan originations were $2.3
billion compared to $2.5
billion in the prior quarter.
- Total net revenue was $245.7
million compared to $262.7
million in the prior quarter, as growth in net interest
income was offset by lower marketplace revenue.
-
- Net interest income increased 8% from the prior quarter to
$146.7 million, primarily due to
higher balance sheet growth and partially offset by lower net
interest margin due to higher cost of deposits.
- Marketplace revenue was $95.6
million compared to $123.4
million in the prior quarter, reflecting a reduction in sold
marketplace volumes.
- Net income of $13.7 million, or
diluted EPS of $0.13, compared to
$23.6 million, or diluted EPS of
$0.22, in the prior quarter,
reflecting higher credit provisioning due to growth in the
held-for-investment portfolio as well as higher tax expense.
- Pre-provision net revenue (PPNR) of $88.4 million grew 7% over the prior quarter,
driven by the Company's cost reduction actions and a $9.0 million one-time revenue benefit primarily
due to slower prepayments.
- Credit quality of the held-for-investment prime loan portfolio
performing in-line with expectations as portfolio seasons;
provision for credit losses of $70.6
million primarily reflects $1.0
billion of quarterly loan originations held for
investment.
- Efficiency ratio improved to 64.0% from 68.5% in the prior
quarter due to cost reduction actions and marketing
efficiency.
|
Three Months
Ended
|
|
($ in millions, except
per share amounts)
|
March 31,
2023
|
|
December 31,
2022
|
|
March 31,
2022
|
|
Total net
revenue
|
$
245.7
|
|
$
262.7
|
|
$
289.5
|
|
Non-interest
expense
|
157.3
|
|
180.0
|
|
191.2
|
|
Pre-provision net
revenue (1)
|
88.4
|
|
82.7
|
|
98.3
|
|
|
|
|
|
|
|
|
Provision for credit
losses
|
70.6
|
|
61.5
|
|
52.5
|
|
Income before income
tax benefit (expense)
|
17.8
|
|
21.2
|
|
45.8
|
|
Income tax benefit
(expense)
|
(4.1)
|
|
2.4
|
|
(5.0)
|
|
Net income
|
$
13.7
|
|
$
23.6
|
|
$
40.8
|
|
Diluted EPS
|
$
0.13
|
|
$
0.22
|
|
$
0.39
|
|
|
|
|
|
|
|
|
Income tax benefit from
release of tax valuation allowance
|
$
—
|
|
$
3.2
|
|
$
—
|
|
Net income excluding
income tax benefit (1)
|
$
13.7
|
|
$
20.4
|
|
$
40.8
|
|
Diluted EPS excluding
income tax benefit (1)
|
$
0.13
|
|
$
0.19
|
|
$
0.39
|
|
(1) See page 3 of this
release for additional information on our use of non-GAAP financial
measures.
|
For a calculation of Pre-Provision Net Revenue, Net Income
Excluding Income Tax Benefit, Diluted EPS Excluding Income Tax
Benefit, and Tangible Book Value Per Common Share, refer to the
"Reconciliation of GAAP to Non-GAAP Financial
Measures" tables at the end of this release.
Financial Outlook
|
Second Quarter
2023
|
|
Loan
Originations
|
$1.9B to
$2.1B
|
|
Pre-Provision Net
Revenue (PPNR)
|
$60M to $70M
|
|
About LendingClub
LendingClub Corporation (NYSE: LC) is the parent company of
LendingClub Bank, National Association, Member FDIC. LendingClub
Bank is the leading digital marketplace bank in the U.S., where
members can access a broad range of financial products and services
designed to help them pay less when borrowing and earn more when
saving. Based on more than 150 billion cells of data and over
$80 billion in loans, our advanced credit decisioning and
machine-learning models are used across the customer lifecycle to
expand seamless access to credit for our members, while generating
compelling risk-adjusted returns for our loan investors. Since
2007, more than 4.7 million members have joined the Club to help
reach their financial goals. For more information about
LendingClub, visit https://www.lendingclub.com.
Conference Call and Webcast Information
The LendingClub first quarter 2023 webcast and teleconference is
scheduled to begin at 2:00 p.m. Pacific Time (or
5:00 p.m. Eastern Time) on Wednesday, April 26, 2023. A
live webcast of the call will be available at
http://ir.lendingclub.com under the Filings & Financials menu
in Quarterly Results. To access the call, please dial
+1 (404) 975-4839, or outside the U.S.
+1 (929) 526-1599, with Access Code 900462, ten
minutes prior to 2:00 p.m. Pacific Time (or 5:00 p.m.
Eastern Time). An audio archive of the call will be available at
http://ir.lendingclub.com. An audio replay will also be available
1 hour after the end of the call until May 3, 2023, by
calling +1 (929) 458-6194 or outside the U.S.
+44 (204) 525-0658, with Access Code 850910.
LendingClub has used, and intends to use, its investor relations
website, blog (http://blog.lendingclub.com), Twitter handle
(@LendingClub) and Facebook page
(https://www.facebook.com/LendingClubTeam) as a means of disclosing
material non-public information and to comply with its disclosure
obligations under Regulation FD.
Contacts
For Investors:
IR@lendingclub.com
Media Contact:
Press@lendingclub.com
Non-GAAP Financial Measures
To supplement our financial statements, which are prepared and
presented in accordance with GAAP, we use the following non-GAAP
financial measures: Pre-Provision Net Revenue, Net Income Excluding
Income Tax Benefit, Diluted EPS Excluding Income Tax Benefit, and
Tangible Book Value Per Common Share. Our non-GAAP financial
measures do have limitations as analytical tools and you should not
consider them in isolation or as a substitute for an analysis of
our results under GAAP.
We believe these non-GAAP financial measures provide management
and investors with useful supplemental information about the
financial performance of our business, enable comparison of
financial results between periods where certain items may vary
independent of business performance, and enable comparison of our
financial results with other public companies.
We believe Pre-Provision Net Revenue, Net Income Excluding
Income Tax Benefit and Diluted EPS Excluding Income Tax Benefit are
important measures because they reflect the financial performance
of our business operations. Pre-Provision Net Revenue is a non-GAAP
financial measure calculated by subtracting the provision for
credit losses and income tax benefit/expense from net income. Net
Income Excluding Income Tax Benefit adjusts for the release of a
deferred tax asset valuation allowance in 2022. Diluted EPS
Excluding Income Tax Benefit is a non-GAAP financial measure
calculated by dividing Net Income Excluding Income Tax Benefit by
the weighted-average diluted common shares outstanding.
We believe Tangible Book Value (TBV) Per Common Share is an
important measure used to evaluate the company's use of equity. TBV
Per Common Share is a non-GAAP financial measure representing
common equity reduced by goodwill and intangible assets, divided by
ending common shares issued and outstanding.
For a reconciliation of such measures to the nearest GAAP
measures, please refer to the tables beginning on page 13 of
this release.
Safe Harbor Statement
Some of the statements above, including statements regarding
our competitive advantages, macroeconomic outlook, anticipated
future performance and financial results, are "forward-looking
statements." The words "anticipate," "believe," "estimate,"
"expect," "intend," "may," "outlook," "plan," "predict," "project,"
"will," "would" and similar expressions may identify
forward-looking statements, although not all forward-looking
statements contain these identifying words. Factors that could
cause actual results to differ materially from those contemplated
by these forward-looking statements include: our ability to
continue to attract and retain new and existing customers; our
ability to realize the expected benefits from recent initiatives,
including our cost reduction plan and the acquisition of a
$1 billion loan portfolio;
competition; overall economic conditions; the interest rate
environment; the regulatory environment; demand for the types of
loans facilitated by us; default rates and those factors set forth
in the section titled "Risk Factors" in our most recent Annual
Report on Form 10-K, as filed with the Securities and Exchange
Commission, as well as in our subsequent filings with the
Securities and Exchange Commission. We may not actually achieve the
plans, intentions or expectations disclosed in forward-looking
statements, and you should not place undue reliance on
forward-looking statements. Actual results or events could differ
materially from the plans, intentions and expectations disclosed in
forward-looking statements. We do not assume any obligation to
update any forward-looking statements, whether as a result of new
information, future events or otherwise, except as required by
law.
LENDINGCLUB CORPORATION
OPERATING HIGHLIGHTS
(In thousands, except
percentages or as noted)
(Unaudited)
|
|
|
|
|
As of and for the
three months ended
|
|
%
Change
|
|
|
March 31,
2023
|
|
December 31,
2022
|
|
September
30,
2022
|
|
June
30,
2022
|
|
March 31,
2022
|
|
Q/Q
|
|
Y/Y
|
|
Operating
Highlights:
|
|
Non-interest
income
|
$ 98,990
|
|
$ 127,465
|
|
$ 181,237
|
|
$
213,832
|
|
$
189,857
|
|
(22) %
|
|
(48) %
|
|
Net interest
income
|
146,704
|
|
135,243
|
|
123,676
|
|
116,226
|
|
99,680
|
|
8 %
|
|
47 %
|
|
Total net
revenue
|
245,694
|
|
262,708
|
|
304,913
|
|
330,058
|
|
289,537
|
|
(6) %
|
|
(15) %
|
|
Non-interest
expense
|
157,308
|
|
180,044
|
|
186,219
|
|
209,386
|
|
191,204
|
|
(13) %
|
|
(18) %
|
|
Pre-provision net
revenue(1)
|
88,386
|
|
82,664
|
|
118,694
|
|
120,672
|
|
98,333
|
|
7 %
|
|
(10) %
|
|
Provision for credit
losses
|
70,584
|
|
61,512
|
|
82,739
|
|
70,566
|
|
52,509
|
|
15 %
|
|
34 %
|
|
Income before income
tax benefit (expense)
|
17,802
|
|
21,152
|
|
35,955
|
|
50,106
|
|
45,824
|
|
(16) %
|
|
(61) %
|
|
Income tax benefit
(expense)
|
(4,136)
|
|
2,439
|
|
7,243
|
|
131,954
|
|
(4,988)
|
|
N/M
|
|
(17) %
|
|
Net income
|
13,666
|
|
23,591
|
|
43,198
|
|
182,060
|
|
40,836
|
|
(42) %
|
|
(67) %
|
|
Income tax benefit from
release of tax valuation allowance
|
—
|
|
3,180
|
|
5,015
|
|
135,300
|
|
—
|
|
N/M
|
|
N/M
|
|
Net income excluding
income tax benefit(1)(2)
|
$ 13,666
|
|
$
20,411
|
|
$
38,183
|
|
$ 46,760
|
|
$ 40,836
|
|
(33) %
|
|
(67) %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic EPS – common
stockholders
|
$
0.13
|
|
$
0.22
|
|
$
0.41
|
|
$
1.77
|
|
$
0.40
|
|
(41) %
|
|
(68) %
|
|
Diluted EPS – common
stockholders
|
$
0.13
|
|
$
0.22
|
|
$
0.41
|
|
$
1.73
|
|
$
0.39
|
|
(41) %
|
|
(67) %
|
|
Diluted EPS excluding
income tax benefit(1)(2)
|
$
0.13
|
|
$
0.19
|
|
$
0.36
|
|
$
0.45
|
|
$
0.39
|
|
(32) %
|
|
(67) %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LendingClub
Corporation Performance Metrics:
|
|
Net interest
margin
|
7.5 %
|
|
7.8 %
|
|
8.3 %
|
|
8.5 %
|
|
8.3 %
|
|
|
|
|
|
Efficiency
ratio(3)
|
64.0 %
|
|
68.5 %
|
|
61.1 %
|
|
63.4 %
|
|
66.0 %
|
|
|
|
|
|
Return on average
equity (ROE)(4)
|
4.6 %
|
|
7.2 %
|
|
14.2 %
|
|
33.8 %
|
|
18.7 %
|
|
|
|
|
|
Return on average total
assets (ROA)(5)
|
0.7 %
|
|
1.1 %
|
|
2.5 %
|
|
5.5 %
|
|
3.1 %
|
|
|
|
|
|
Marketing expense as a
% of loan originations
|
1.2 %
|
|
1.4 %
|
|
1.3 %
|
|
1.6 %
|
|
1.7 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LendingClub
Corporation Capital Metrics:
|
|
Common equity Tier 1
capital ratio
|
15.6 %
|
|
15.8 %
|
|
18.3 %
|
|
20.0 %
|
|
20.6 %
|
|
|
|
|
|
Tier 1 leverage
ratio
|
12.8 %
|
|
14.1 %
|
|
15.7 %
|
|
16.2 %
|
|
15.6 %
|
|
|
|
|
|
Book value per common
share
|
$
11.08
|
|
$
10.93
|
|
$
10.67
|
|
$
10.41
|
|
$
8.68
|
|
1 %
|
|
28 %
|
|
Tangible book value per
common share(1)
|
$
10.23
|
|
$
10.06
|
|
$
9.78
|
|
$
9.50
|
|
$
7.75
|
|
2 %
|
|
32 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loan Originations
(in millions)(6):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total loan
originations
|
$
2,288
|
|
$
2,524
|
|
$
3,539
|
|
$
3,840
|
|
$
3,217
|
|
(9) %
|
|
(29) %
|
|
Marketplace
loans
|
$
1,286
|
|
$
1,824
|
|
$
2,386
|
|
$
2,819
|
|
$
2,360
|
|
(29) %
|
|
(46) %
|
|
Loan originations held
for investment
|
$
1,002
|
|
$
701
|
|
$
1,153
|
|
$
1,021
|
|
$
856
|
|
43 %
|
|
17 %
|
|
Loan originations held
for investment as a % of total loan originations
|
44 %
|
|
28 %
|
|
33 %
|
|
27 %
|
|
27 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Servicing Portfolio
AUM (in millions)(7):
|
|
Total servicing
portfolio
|
$
16,060
|
|
$
16,157
|
|
$
15,929
|
|
$ 14,783
|
|
$
13,341
|
|
(1) %
|
|
20 %
|
|
Loans serviced for
others
|
$
10,504
|
|
$
10,819
|
|
$
11,807
|
|
$ 11,382
|
|
$
10,475
|
|
(3) %
|
|
— %
|
|
LENDINGCLUB CORPORATION
OPERATING HIGHLIGHTS
(Continued)
(In thousands, except
percentages or as noted)
(Unaudited)
|
|
|
|
|
As of and for the
three months ended
|
|
%
Change
|
|
|
March 31,
2023
|
|
December 31,
2022
|
|
September
30,
2022
|
|
June
30,
2022
|
|
March 31,
2022
|
|
Q/Q
|
|
Y/Y
|
|
Balance Sheet
Data:
|
|
Loans and leases held
for investment at amortized cost, net, excluding PPP
loans
|
$ 5,091,969
|
|
$
4,638,331
|
|
$
4,414,347
|
|
$
3,692,667
|
|
$ 3,049,325
|
|
10 %
|
|
67 %
|
|
PPP loans
|
$ 51,112
|
|
$
66,971
|
|
$
89,379
|
|
$
118,794
|
|
$
184,986
|
|
(24) %
|
|
(72) %
|
|
Total loans and leases
held for investment at amortized cost, net(8)
|
$ 5,143,081
|
|
$
4,705,302
|
|
$
4,503,726
|
|
$
3,811,461
|
|
$ 3,234,311
|
|
9 %
|
|
59 %
|
|
Loans held for
investment at fair value
|
$
748,618
|
|
$ 925,938
|
|
$
15,057
|
|
$ 20,583
|
|
$ 15,384
|
|
(19) %
|
|
4,766 %
|
|
Total loans and leases
held for investment
|
$ 5,891,699
|
|
$
5,631,240
|
|
$
4,518,783
|
|
$
3,832,044
|
|
$ 3,249,695
|
|
5 %
|
|
81 %
|
|
Total assets
|
$ 8,754,018
|
|
$
7,979,747
|
|
$
6,775,074
|
|
$
6,186,765
|
|
$ 5,574,425
|
|
10 %
|
|
57 %
|
|
Total
deposits
|
$ 7,218,854
|
|
$
6,392,553
|
|
$
5,123,506
|
|
$
4,527,672
|
|
$ 3,977,477
|
|
13 %
|
|
81 %
|
|
Total
liabilities
|
$ 7,563,276
|
|
$
6,815,453
|
|
$
5,653,664
|
|
$
5,107,648
|
|
$ 4,686,991
|
|
11 %
|
|
61 %
|
|
Total equity
|
$ 1,190,742
|
|
$
1,164,294
|
|
$
1,121,410
|
|
$
1,079,117
|
|
$
887,434
|
|
2 %
|
|
34 %
|
|
|
|
N/M – Not
meaningful
|
|
(1)
|
Represents a non-GAAP
financial measure. See "Reconciliation of GAAP to Non-GAAP
Financial Measures."
|
|
(2)
|
Excludes fourth, third
and second quarter 2022 income tax benefit of $3.2 million,
$5.0 million and $135.3 million, respectively, due to the
release of a deferred tax asset valuation allowance.
|
|
(3)
|
Calculated as the ratio
of non-interest expense to total net revenue.
|
|
(4)
|
Calculated as
annualized net income (which excludes the income tax benefit from
the release of the deferred tax asset valuation allowance in the
periods it did not occur) divided by average equity for the period
presented.
|
|
(5)
|
Calculated as
annualized net income (which excludes the income tax benefit from
the release of the deferred tax asset valuation allowance in the
periods it did not occur) divided by average total assets for the
period presented.
|
|
(6)
|
Includes unsecured
personal loans and auto loans only.
|
|
(7)
|
Loans serviced on our
platform, which includes unsecured personal loans, auto loans and
education and patient finance loans serviced for others and held
for investment by the company.
|
|
(8)
|
Excludes loans held for
investment at fair value, which primarily consists of a loan
portfolio that was acquired in the fourth quarter of
2022.
|
|
The asset quality metrics presented in the following table are
for loans and leases held for investment at amortized cost and do
not reflect loans held for investment at fair value:
|
As of and for the
three months ended
|
|
|
March 31,
2023
|
|
December 31,
2022
|
|
September
30,
2022
|
|
June
30,
2022
|
|
March
31,
2022
|
|
Asset Quality
Metrics:
|
|
Allowance for loan and
lease losses to total loans and leases held for
investment
|
6.4 %
|
|
6.5 %
|
|
6.3 %
|
|
6.0 %
|
|
5.5 %
|
|
Allowance for loan and
lease losses to consumer loans and leases held for
investment
|
7.1 %
|
|
7.3 %
|
|
7.2 %
|
|
6.9 %
|
|
6.6 %
|
|
Allowance for loan and
lease losses to commercial loans and leases held for
investment
|
2.0 %
|
|
2.0 %
|
|
1.9 %
|
|
2.0 %
|
|
1.8 %
|
|
Net
charge-offs
|
$
49,845
|
|
$
37,148
|
|
$
22,658
|
|
$
14,778
|
|
$
8,632
|
|
Net charge-off
ratio(1)
|
3.8 %
|
|
3.0 %
|
|
2.1 %
|
|
1.6 %
|
|
1.2 %
|
|
|
|
(1)
|
Net charge-off ratio is
calculated as annualized net charge-offs divided by average
outstanding loans and leases held for investment during the period,
excluding PPP loans.
|
LENDINGCLUB CORPORATION
LOANS AND LEASES HELD FOR
INVESTMENT
(In
thousands)
(Unaudited)
|
|
|
|
The following table
presents loans and leases held for investment at amortized cost and
loans held for investment at fair value:
|
|
|
March 31,
2023
|
|
December 31,
2022
|
|
Unsecured
personal
|
$
4,319,148
|
|
$
3,866,373
|
|
Residential
mortgages
|
197,728
|
|
199,601
|
|
Secured
consumer
|
212,748
|
|
194,634
|
|
Total consumer loans
held for investment
|
4,729,624
|
|
4,260,608
|
|
Equipment finance
(1)
|
153,905
|
|
160,319
|
|
Commercial real
estate
|
372,770
|
|
373,501
|
|
Commercial and
industrial (2)
|
235,639
|
|
238,726
|
|
Total commercial loans
and leases held for investment
|
762,314
|
|
772,546
|
|
Total loans and leases
held for investment at amortized cost
|
5,491,938
|
|
5,033,154
|
|
Allowance for loan and
lease losses
|
(348,857)
|
|
(327,852)
|
|
Loans and leases held
for investment at amortized cost, net
|
$
5,143,081
|
|
$
4,705,302
|
|
Loans held for
investment at fair value
|
748,618
|
|
925,938
|
|
Total loans and leases
held for investment
|
$
5,891,699
|
|
$
5,631,240
|
|
|
|
(1)
|
Comprised of sales-type
leases for equipment.
|
(2)
|
Includes $51.1 million
and $67.0 million of Paycheck Protection Program (PPP) loans
as of March 31, 2023 and
December 31, 2022,
respectively. Such loans are guaranteed by the Small Business
Association and, therefore,
the company determined
no allowance for expected credit losses is required on these
loans.
|
LENDINGCLUB
CORPORATION
ALLOWANCE FOR LOAN
AND LEASE LOSSES
(In
thousands)
(Unaudited)
|
|
The following tables
present the allowance for loan and lease losses on loans and leases
held for investment at amortized cost and do not reflect loans held
for investment at fair value:
|
|
|
|
|
Three Months
Ended
|
|
|
March 31,
2023
|
|
December 31,
2022
|
|
|
Consumer
|
|
Commercial
|
|
Total
|
|
Consumer
|
|
Commercial
|
|
Total
|
|
Allowance for loan and
lease losses, beginning of period
|
$
312,489
|
|
$
15,363
|
|
$ 327,852
|
|
$
288,138
|
|
$
15,063
|
|
$ 303,201
|
|
Credit loss expense for
loans and leases held for investment
|
70,684
|
|
166
|
|
70,850
|
|
61,392
|
|
407
|
|
61,799
|
|
Charge-offs
|
(52,212)
|
|
(351)
|
|
(52,563)
|
|
(38,579)
|
|
(225)
|
|
(38,804)
|
|
Recoveries
|
2,585
|
|
133
|
|
2,718
|
|
1,538
|
|
118
|
|
1,656
|
|
Allowance for loan and
lease losses, end of period
|
$
333,546
|
|
$
15,311
|
|
$ 348,857
|
|
$
312,489
|
|
$
15,363
|
|
$ 327,852
|
|
|
Three Months
Ended
|
|
|
March 31,
2022
|
|
|
Consumer
|
|
Commercial
|
|
Total
|
|
Allowance for loan and
lease losses, beginning of period
|
$
128,812
|
|
$
15,577
|
|
$ 144,389
|
|
Credit loss expense for
loans and leases held for investment
|
53,718
|
|
(1,490)
|
|
52,228
|
|
Charge-offs
|
(9,017)
|
|
(72)
|
|
(9,089)
|
|
Recoveries
|
344
|
|
113
|
|
457
|
|
Allowance for loan and
lease losses, end of period
|
$
173,857
|
|
$
14,128
|
|
$ 187,985
|
|
LENDINGCLUB CORPORATION
PAST DUE LOANS AND LEASES HELD FOR
INVESTMENT
(In
thousands)
(Unaudited)
|
The following tables
present past due loans and leases held for investment at amortized
cost and do not reflect loans held for investment at fair
value:
|
|
|
March 31,
2023
|
30-59
Days
|
|
60-89
Days
|
|
90 or More
Days
|
|
Total Days
Past Due
|
|
Unsecured
personal
|
$ 26,941
|
|
$ 19,759
|
|
$ 18,984
|
|
$
65,684
|
|
Residential
mortgages
|
230
|
|
—
|
|
167
|
|
397
|
|
Secured
consumer
|
1,922
|
|
260
|
|
187
|
|
2,369
|
|
Total consumer loans
held for investment
|
$ 29,093
|
|
$
20,019
|
|
$ 19,338
|
|
$
68,450
|
|
|
|
|
|
|
|
|
|
|
Equipment
finance
|
$
3,020
|
|
$
—
|
|
$
771
|
|
$
3,791
|
|
Commercial real
estate
|
8,251
|
|
2,112
|
|
103
|
|
10,466
|
|
Commercial and
industrial (1)
|
941
|
|
—
|
|
1,608
|
|
2,549
|
|
Total commercial loans
and leases held for investment (1)
|
$ 12,212
|
|
$
2,112
|
|
$
2,482
|
|
$
16,806
|
|
Total loans and leases
held for investment at amortized cost (1)
|
$ 41,305
|
|
$ 22,131
|
|
$
21,820
|
|
$
85,256
|
|
December 31,
2022
|
30-59
Days
|
|
60-89
Days
|
|
90 or More
Days
|
|
|
Total Days
Past Due
|
Unsecured
personal
|
$ 21,016
|
|
$ 16,418
|
|
$ 16,255
|
|
|
$
53,689
|
Residential
mortgages
|
—
|
|
254
|
|
331
|
|
|
585
|
Secured
consumer
|
1,720
|
|
382
|
|
188
|
|
|
2,290
|
Total consumer loans
held for investment
|
$ 22,736
|
|
$ 17,054
|
|
$
16,774
|
|
|
$
56,564
|
|
|
|
|
|
|
|
|
|
Equipment
finance
|
$
3,172
|
|
$
—
|
|
$
859
|
|
|
$
4,031
|
Commercial real
estate
|
—
|
|
102
|
|
—
|
|
|
102
|
Commercial and
industrial (1)
|
—
|
|
—
|
|
1,643
|
|
|
1,643
|
Total commercial loans
and leases held for investment (1)
|
$
3,172
|
|
$
102
|
|
$
2,502
|
|
|
$
5,776
|
Total loans and leases
held for investment at amortized cost (1)
|
$ 25,908
|
|
$
17,156
|
|
$
19,276
|
|
|
$
62,340
|
|
(1)
Past due PPP loans are excluded from the
tables.
|
LENDINGCLUB CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF
INCOME
(In thousands, except
share and per share data)
(Unaudited)
|
|
|
|
|
Three Months
Ended
|
|
Change
(%)
|
|
|
March 31,
2023
|
|
December 31,
2022
|
|
March 31,
2022
|
|
Q1
2023
vs
Q4
2022
|
|
Q1
2023
vs
Q1
2022
|
|
Non-interest
income:
|
|
|
|
|
|
|
|
|
|
|
Origination
fees
|
$
70,543
|
|
$
100,692
|
|
$
122,093
|
|
(30) %
|
|
(42) %
|
|
Servicing
fees
|
26,380
|
|
20,169
|
|
18,514
|
|
31 %
|
|
42 %
|
|
Gain on sales of
loans
|
14,125
|
|
18,352
|
|
24,110
|
|
(23) %
|
|
(41) %
|
|
Net fair value
adjustments
|
(15,414)
|
|
(15,774)
|
|
15,249
|
|
(2) %
|
|
(201) %
|
|
Marketplace
revenue
|
95,634
|
|
123,439
|
|
179,966
|
|
(23) %
|
|
(47) %
|
|
Other non-interest
income
|
3,356
|
|
4,026
|
|
9,891
|
|
(17) %
|
|
(66) %
|
|
Total non-interest
income
|
98,990
|
|
127,465
|
|
189,857
|
|
(22) %
|
|
(48) %
|
|
|
|
|
|
|
|
|
|
|
|
|
Total interest
income
|
202,413
|
|
173,999
|
|
111,653
|
|
16 %
|
|
81 %
|
|
Total interest
expense
|
55,709
|
|
38,756
|
|
11,973
|
|
44 %
|
|
365 %
|
|
Net interest
income
|
146,704
|
|
135,243
|
|
99,680
|
|
8 %
|
|
47 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Total net
revenue
|
245,694
|
|
262,708
|
|
289,537
|
|
(6) %
|
|
(15) %
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for credit
losses
|
70,584
|
|
61,512
|
|
52,509
|
|
15 %
|
|
34 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest
expense:
|
|
|
|
|
|
|
|
|
|
|
Compensation and
benefits
|
73,307
|
|
87,768
|
|
81,610
|
|
(16) %
|
|
(10) %
|
|
Marketing
|
26,880
|
|
35,139
|
|
55,080
|
|
(24) %
|
|
(51) %
|
|
Equipment and
software
|
13,696
|
|
13,200
|
|
11,046
|
|
4 %
|
|
24 %
|
|
Depreciation and
amortization
|
12,354
|
|
11,554
|
|
11,039
|
|
7 %
|
|
12 %
|
|
Professional
services
|
9,058
|
|
10,029
|
|
12,406
|
|
(10) %
|
|
(27) %
|
|
Occupancy
|
4,310
|
|
4,698
|
|
6,019
|
|
(8) %
|
|
(28) %
|
|
Other non-interest
expense
|
17,703
|
|
17,656
|
|
14,004
|
|
— %
|
|
26 %
|
|
Total non-interest
expense
|
157,308
|
|
180,044
|
|
191,204
|
|
(13) %
|
|
(18) %
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income
tax benefit (expense)
|
17,802
|
|
21,152
|
|
45,824
|
|
(16) %
|
|
(61) %
|
|
Income tax benefit
(expense)
|
(4,136)
|
|
2,439
|
|
(4,988)
|
|
N/M
|
|
(17) %
|
|
Net
income
|
$
13,666
|
|
$
23,591
|
|
$
40,836
|
|
(42) %
|
|
(67) %
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income per
share:
|
|
|
|
|
|
|
|
|
|
|
Basic EPS – common
stockholders
|
$
0.13
|
|
$
0.22
|
|
$
0.40
|
|
(41) %
|
|
(68) %
|
|
Diluted EPS – common
stockholders
|
$
0.13
|
|
$
0.22
|
|
$
0.39
|
|
(41) %
|
|
(67) %
|
|
Weighted-average common
shares – Basic
|
106,912,139
|
|
105,650,177
|
|
101,493,561
|
|
1 %
|
|
5 %
|
|
Weighted-average common
shares – Diluted
|
106,917,770
|
|
105,984,612
|
|
105,052,904
|
|
1 %
|
|
2 %
|
|
LENDINGCLUB CORPORATION
NET INTEREST INCOME
(In thousands, except
percentages or as noted)
(Unaudited)
|
|
|
|
|
Consolidated
LendingClub Corporation (1)
|
|
|
Three Months
Ended
March 31,
2023
|
|
Three Months
Ended
December 31,
2022
|
|
Three Months
Ended
March 31,
2022
|
|
|
Average
Balance
|
|
Interest
Income/
Expense
|
|
Average
Yield/
Rate
|
|
Average
Balance
|
|
Interest
Income/
Expense
|
|
Average
Yield/
Rate
|
|
Average
Balance
|
|
Interest
Income/
Expense
|
|
Average
Yield/
Rate
|
|
Interest-earning
assets (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash, cash equivalents,
restricted cash and other
|
$ 1,220,677
|
|
$
13,714
|
|
4.49 %
|
|
$ 1,139,887
|
|
$
10,595
|
|
3.72 %
|
|
$
892,921
|
|
$ 688
|
|
0.31 %
|
|
Securities available
for sale at fair value
|
362,960
|
|
3,900
|
|
4.30 %
|
|
349,512
|
|
3,359
|
|
3.84 %
|
|
325,155
|
|
4,511
|
|
5.55 %
|
|
Loans held for sale at
fair value
|
110,580
|
|
5,757
|
|
20.83 %
|
|
114,851
|
|
5,724
|
|
19.93 %
|
|
255,139
|
|
7,450
|
|
11.68 %
|
|
Loans and leases held
for investment:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unsecured personal
loans
|
4,066,713
|
|
133,687
|
|
13.15 %
|
|
3,825,808
|
|
125,872
|
|
13.16 %
|
|
2,060,323
|
|
78,376
|
|
15.22 %
|
|
Commercial and other
consumer loans
|
1,175,504
|
|
16,780
|
|
5.71 %
|
|
1,164,326
|
|
15,197
|
|
5.22 %
|
|
1,075,412
|
|
13,066
|
|
4.86 %
|
|
Loans and leases held
for investment at amortized cost
|
5,242,217
|
|
150,467
|
|
11.48 %
|
|
4,990,134
|
|
141,069
|
|
11.31 %
|
|
3,135,735
|
|
91,442
|
|
11.66 %
|
|
Loans held for
investment at fair value
|
836,313
|
|
26,892
|
|
12.86 %
|
|
308,570
|
|
10,862
|
|
14.08 %
|
|
18,523
|
|
593
|
|
12.80 %
|
|
Total loans and leases
held for investment
|
6,078,530
|
|
177,359
|
|
11.67 %
|
|
5,298,704
|
|
151,931
|
|
11.47 %
|
|
3,154,258
|
|
92,035
|
|
11.67 %
|
|
Retail and certificate
loans held for investment at fair value
|
46,525
|
|
1,683
|
|
14.47 %
|
|
66,469
|
|
2,390
|
|
14.38 %
|
|
198,813
|
|
6,969
|
|
14.02 %
|
|
Total
interest-earning assets
|
7,819,272
|
|
202,413
|
|
10.35 %
|
|
6,969,423
|
|
173,999
|
|
9.99 %
|
|
4,826,286
|
|
111,653
|
|
9.25 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and due from banks
and restricted cash
|
71,878
|
|
|
|
|
|
64,907
|
|
|
|
|
|
92,683
|
|
|
|
|
|
Allowance for loan and
lease losses
|
(338,359)
|
|
|
|
|
|
(314,861)
|
|
|
|
|
|
(163,631)
|
|
|
|
|
|
Other non-interest
earning assets
|
666,650
|
|
|
|
|
|
613,664
|
|
|
|
|
|
486,363
|
|
|
|
|
|
Total
assets
|
$ 8,219,441
|
|
|
|
|
|
$ 7,333,133
|
|
|
|
|
|
$ 5,241,701
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
deposits:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Checking and money
market accounts
|
$ 1,633,691
|
|
$
7,568
|
|
1.88 %
|
|
$ 1,929,260
|
|
$ 7,500
|
|
1.54 %
|
|
$ 2,240,450
|
|
$
1,724
|
|
0.31 %
|
|
Savings accounts and
certificates of deposit
|
4,747,478
|
|
45,705
|
|
3.90 %
|
|
3,576,205
|
|
28,251
|
|
3.13 %
|
|
1,071,133
|
|
1,714
|
|
0.64 %
|
|
Interest-bearing
deposits
|
6,381,169
|
|
53,273
|
|
3.39 %
|
|
5,505,465
|
|
35,751
|
|
2.58 %
|
|
3,311,583
|
|
3,438
|
|
0.42 %
|
|
Retail notes,
certificates and secured borrowings
|
46,525
|
|
1,683
|
|
14.47 %
|
|
66,469
|
|
2,390
|
|
14.38 %
|
|
198,813
|
|
6,969
|
|
14.02 %
|
|
Other interest-bearing
liabilities
|
107,520
|
|
753
|
|
2.80 %
|
|
105,834
|
|
615
|
|
2.33 %
|
|
312,690
|
|
1,566
|
|
2.00 %
|
|
Total
interest-bearing liabilities
|
6,535,214
|
|
55,709
|
|
3.46 %
|
|
5,677,768
|
|
38,756
|
|
2.71 %
|
|
3,823,086
|
|
11,973
|
|
1.25 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest bearing
deposits
|
241,954
|
|
|
|
|
|
251,686
|
|
|
|
|
|
227,337
|
|
|
|
|
|
Other
liabilities
|
263,868
|
|
|
|
|
|
266,558
|
|
|
|
|
|
319,241
|
|
|
|
|
|
Total
liabilities
|
$ 7,041,036
|
|
|
|
|
|
$ 6,196,012
|
|
|
|
|
|
$ 4,369,664
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
equity
|
$ 1,178,405
|
|
|
|
|
|
$ 1,137,121
|
|
|
|
|
|
$
872,037
|
|
|
|
|
|
Total liabilities
and equity
|
$ 8,219,441
|
|
|
|
|
|
$ 7,333,133
|
|
|
|
|
|
$ 5,241,701
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate
spread
|
|
|
|
|
6.90 %
|
|
|
|
|
|
7.28 %
|
|
|
|
|
|
8.00 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income
and net interest margin
|
|
|
$
146,704
|
|
7.50 %
|
|
|
|
$ 135,243
|
|
7.76 %
|
|
|
|
$
99,680
|
|
8.26 %
|
|
|
|
(1)
|
Consolidated
presentation reflects intercompany eliminations.
|
(2)
|
Nonaccrual loans and
any related income are included in their respective loan
categories.
|
LENDINGCLUB CORPORATION
CONSOLIDATED BALANCE SHEETS
(In Thousands, Except
Share and Per Share Amounts)
(Unaudited)
|
|
|
|
|
March 31,
2023
|
|
December 31,
2022
|
|
Assets
|
|
|
|
|
Cash and due from
banks
|
$
22,732
|
|
$
23,125
|
|
Interest-bearing
deposits in banks
|
1,614,265
|
|
1,033,905
|
|
Total cash and cash
equivalents
|
1,636,997
|
|
1,057,030
|
|
Restricted
cash
|
47,342
|
|
67,454
|
|
Securities available
for sale at fair value ($428,395 and $399,668 at amortized cost,
respectively)
|
380,028
|
|
345,702
|
|
Loans held for sale at
fair value
|
44,647
|
|
110,400
|
|
Loans and leases held
for investment
|
5,491,938
|
|
5,033,154
|
|
Allowance for loan and
lease losses
|
(348,857)
|
|
(327,852)
|
|
Loans and leases held
for investment, net
|
5,143,081
|
|
4,705,302
|
|
Loans held for
investment at fair value
|
748,618
|
|
925,938
|
|
Retail and certificate
loans held for investment at fair value
|
38,855
|
|
55,425
|
|
Property, equipment
and software, net
|
144,041
|
|
136,473
|
|
Goodwill
|
75,717
|
|
75,717
|
|
Other
assets
|
494,692
|
|
500,306
|
|
Total
assets
|
$
8,754,018
|
|
$ 7,979,747
|
|
Liabilities and
Equity
|
|
|
|
|
Deposits:
|
|
|
|
|
Interest-bearing
|
$
7,018,014
|
|
$ 6,158,560
|
|
Noninterest-bearing
|
200,840
|
|
233,993
|
|
Total
deposits
|
7,218,854
|
|
6,392,553
|
|
Borrowings
|
52,980
|
|
74,858
|
|
Retail notes,
certificates and secured borrowings at fair value
|
38,855
|
|
55,425
|
|
Other
liabilities
|
252,587
|
|
292,617
|
|
Total
liabilities
|
7,563,276
|
|
6,815,453
|
|
Equity
|
|
|
|
|
Series A Preferred
stock, $0.01 par value; 1,200,000 shares authorized; 0 shares
issued and outstanding
|
—
|
|
—
|
|
Common stock, $0.01
par value; 180,000,000 shares authorized; 107,460,734 and
106,546,995 shares issued and outstanding, respectively
|
1,075
|
|
1,065
|
|
Additional paid-in
capital
|
1,637,283
|
|
1,628,590
|
|
Accumulated
deficit
|
(414,079)
|
|
(427,745)
|
|
Accumulated other
comprehensive loss
|
(33,537)
|
|
(37,616)
|
|
Total
equity
|
1,190,742
|
|
1,164,294
|
|
Total liabilities
and equity
|
$
8,754,018
|
|
$ 7,979,747
|
|
LENDINGCLUB
CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
(In thousands, except share and per share data)
(Unaudited)
|
|
Pre-Provision Net
Revenue
|
|
|
|
|
|
For the three months
ended
|
|
|
|
March 31,
2023
|
|
December
31,
2022
|
|
September
30,
2022
|
|
June 30,
2022
|
|
March
31,
2022
|
|
GAAP Net
income
|
$
13,666
|
|
$
23,591
|
|
$
43,198
|
|
$ 182,060
|
|
$
40,836
|
|
Less: Provision for
credit losses
|
(70,584)
|
|
(61,512)
|
|
(82,739)
|
|
(70,566)
|
|
(52,509)
|
|
Less: Income tax
benefit (expense)
|
(4,136)
|
|
2,439
|
|
7,243
|
|
131,954
|
|
(4,988)
|
|
Pre-provision net
revenue
|
$
88,386
|
|
$
82,664
|
|
$
118,694
|
|
$ 120,672
|
|
$
98,333
|
|
|
|
For the three months
ended
|
|
|
|
March 31,
2023
|
|
December
31,
2022
|
|
September
30,
2022
|
|
June 30,
2022
|
|
March
31,
2022
|
|
Non-interest
income
|
$
98,990
|
|
$
127,465
|
|
$
181,237
|
|
$ 213,832
|
|
$
189,857
|
|
Net interest
income
|
146,704
|
|
135,243
|
|
123,676
|
|
116,226
|
|
99,680
|
|
Total net
revenue
|
245,694
|
|
262,708
|
|
304,913
|
|
330,058
|
|
289,537
|
|
Non-interest
expense
|
(157,308)
|
|
(180,044)
|
|
(186,219)
|
|
(209,386)
|
|
(191,204)
|
|
Pre-provision net
revenue
|
88,386
|
|
82,664
|
|
118,694
|
|
120,672
|
|
98,333
|
|
Provision for credit
losses
|
(70,584)
|
|
(61,512)
|
|
(82,739)
|
|
(70,566)
|
|
(52,509)
|
|
Income before income
tax benefit (expense)
|
17,802
|
|
21,152
|
|
35,955
|
|
50,106
|
|
45,824
|
|
Income tax benefit
(expense)
|
(4,136)
|
|
2,439
|
|
7,243
|
|
131,954
|
|
(4,988)
|
|
GAAP Net
income
|
$
13,666
|
|
$
23,591
|
|
$
43,198
|
|
$ 182,060
|
|
$
40,836
|
|
Net Income Excluding
Income Tax Benefit and Diluted EPS Excluding Income Tax
Benefit
|
|
|
|
For the three months
ended
|
|
|
|
December
31,
2022
|
|
September
30,
2022
|
|
June 30,
2022
|
|
GAAP Net
income
|
$
23,591
|
|
$
43,198
|
|
$
182,060
|
|
Less: Income tax
benefit from release of tax valuation allowance
|
3,180
|
|
5,015
|
|
135,300
|
|
Net income excluding
income tax benefit
|
$
20,411
|
|
$
38,183
|
|
$
46,760
|
|
|
|
|
|
|
|
|
|
GAAP Diluted EPS –
common stockholders
|
$
0.22
|
|
$
0.41
|
|
$
1.73
|
|
|
|
|
|
|
|
|
|
(A)
|
Income tax benefit from
release of tax valuation allowance
|
$
3,180
|
|
$
5,015
|
|
$
135,300
|
|
(B)
|
Weighted-average common
shares – Diluted
|
105,984,612
|
|
105,853,938
|
|
105,042,626
|
|
(A/B)
|
Diluted EPS impact of
income tax benefit
|
$
0.03
|
|
$
0.05
|
|
$
1.29
|
|
|
|
|
|
|
|
|
|
Diluted EPS excluding
income tax benefit
|
$
0.19
|
|
$
0.36
|
|
$
0.44
|
|
LENDINGCLUB CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL
MEASURES (Continued)
(In thousands, except
share and per share data)
(Unaudited)
|
|
|
|
Tangible Book Value
Per Common Share
|
|
|
March
31,
2023
|
|
December
31,
2022
|
|
September
30,
2022
|
|
June 30,
2022
|
|
March
31,
2022
|
|
GAAP common
equity
|
$ 1,190,742
|
|
$ 1,164,294
|
|
$
1,121,410
|
|
$
1,079,117
|
|
$
887,434
|
|
Less:
Goodwill
|
(75,717)
|
|
(75,717)
|
|
(75,717)
|
|
(75,717)
|
|
(75,717)
|
|
Less: Intangible
assets
|
(15,201)
|
|
(16,334)
|
|
(17,512)
|
|
(18,690)
|
|
(19,886)
|
|
Tangible common
equity
|
$ 1,099,824
|
|
$ 1,072,243
|
|
$
1,028,181
|
|
$ 984,710
|
|
$
791,831
|
|
|
|
|
|
|
|
|
|
|
|
|
Book value per
common share
|
|
|
|
|
|
|
|
|
|
|
GAAP common
equity
|
$ 1,190,742
|
|
$ 1,164,294
|
|
$
1,121,410
|
|
$
1,079,117
|
|
$
887,434
|
|
Common shares issued
and outstanding
|
107,460,734
|
|
106,546,995
|
|
105,088,761
|
|
103,630,776
|
|
102,194,037
|
|
Book value per
common share
|
$
11.08
|
|
$
10.93
|
|
$
10.67
|
|
$
10.41
|
|
$
8.68
|
|
|
|
|
|
|
|
|
|
|
|
|
Tangible book value
per common share
|
|
|
|
|
|
|
|
|
|
|
Tangible common
equity
|
$ 1,099,824
|
|
$ 1,072,243
|
|
$
1,028,181
|
|
$ 984,710
|
|
$
791,831
|
|
Common shares issued
and outstanding
|
107,460,734
|
|
106,546,995
|
|
105,088,761
|
|
103,630,776
|
|
102,194,037
|
|
Tangible book value
per common share
|
$
10.23
|
|
$
10.06
|
|
$
9.78
|
|
$
9.50
|
|
$
7.75
|
|
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SOURCE LendingClub Corporation