Lendingclub Corporation · NYSE:LC
Lendingclub — Q1 2024 Earnings Presentation
21 slides from Lendingclub's earnings presentation, Apr 30, 2024
Slide 1: First Quarter 2024 Results
First Quarter 2024 Results April 30, 2024
Slide 2: Disclaimer
Disclaimer Some of the statements in this presentation, including statements regarding our competitive advantages, loan and financial performance, business outlook, and demand for our loan programs, are “forward-looking statements.” The words “anticipate,” “believe,” “estimate,” “expect,” “intend,”
Slide 3: Award-Winning Member-Focused Digital Marketplace Bank
Award-Winning Member-Focused Digital Marketplace Bank Members1 Originations1 4.9+ $90+ Million Billion Best Overall Checking Best Checking Account Account Overall Average Customer Net Promoter Review2 Score (NPS)3 4.83 Out of 5 stars 80 1) Total members and originations based on lifetime volume acro
Slide 4: The Solution We're Providing
The Solution We’re Providing 47% of American households carry over LendingClub’s 4.9+ million Our direct-to-consumer digital $1.3 trillion of revolving debt, paying an members have already come to us to marketplace bank features a estimated $133 billion in fees and access lower-cost credit. While we
Slide 5: Total Addressable Market & Customer Value Proposition Has Never Been Greater
Total Addressable Market & Customer Value Proposition Has Never Been Greater Record High Outstanding Record High Credit Card Revolving Consumer Credit1 Interest Rates2 (in thousands; Feb. 2009 to Feb. 2024, seasonally adjusted) (Feb. 2009 to Feb. 2024) $1.3T $1,350 23 $1,250 Total outstanding revolv
Slide 6: Strategically Positioned for Long-term Success
Strategically Positioned for Long-term Success 1 Fintechs Banks Ability to efficiently serve a broad range of customers Industry-leading marketing efficiency; 4.9M+ members ✓ ✓ ✗ Capital-light, high-ROE marketplace earnings stream $57.8M Non-Interest Income ✓ ✓ ✗ Economics Profitable earnings via lo
Slide 7: 1Q24 Highlights: Achieved Financial Targets
1Q24 Highlights: Achieved Financial Targets 1Q24 Guidance Targets Actuals Commentary2 Total originations of $1.65B, near high end of guidance range consisting of approximately: Q1 Total § $785M for structured certificate program Originations $1.5B to $1.7B $1.65B § $320M of marketplace whole loans §
Slide 8: Strong Capital & Liquidity Position
Strong Capital & Liquidity Position MAJORITY INSURED DEPOSITS AMPLE CASH ON HAND BORROWING CAPACITY 87% $1.1B $2.9B $6.5B of $7.5B total deposits are insured Cash represents 12% of Total Assets; Includes loans and securities pledged compared to 56% average for all FDIC- provides 106% coverage of uni
Slide 9: Ongoing Credit Outperformance vs. Competitive Set
Ongoing Credit Outperformance vs. Competitive Set LendingClub vs. Competitive Set: 30-day+ Delinquencies & Hardships at Month on Book 9 by Quarterly Vintage1,2 LendingClub Competitive Set3 FICO 660-719 FICO 720-779 FICO 780-850 7% 7% 7% 6% 5.9% 5.6% 5.9% 6% 6% 5% 5% 5% 41% Lower 4% 4% 4% 3.8% 3.1% 3
Slide 10: Multiple Loan Disposition Channels Available to Optimize In-Period Earnings
Multiple Loan Disposition Channels Available to Optimize In-Period Earnings and Return on Capital HIGHER Day-1 Contribution LOWER Day-1 Contribution LOWER lifetime value, capital usage, and credit risk HIGHER lifetime value, capital usage, and credit risk WHOLE LOAN STRUCTURED EXTENDED HELD FOR SALE
Slide 11: Resuming Originations Growth with New Programs and Asset Structures
Resuming Originations Growth with New Programs and Asset Structures Consumer Loan Originations1 ($ in millions) $2,288 $2,011 $1,600 - $1,800 $1,630 $1,646 Whole Loan Sales 54% $1,508 Whole Loan Sales Whole Loan Sales Whole Loan Sales 20% 22% 58% Whole Loan Sales 26% Whole Loan Sales + Structured Ce
Slide 12: Structured Certificates Continuing to Improve Risk-Adjusted Revenue Sequentially
Structured Certificates Continuing to Improve Risk-Adjusted Revenue Sequentially Total Net Revenue ($ in millions) $245.7 $99.0 $185.6 $180.7 NON-INTEREST INCOME $54.1 $57.8 Sequential change primarily due to marketplace loan pricing improvement $146.7 $131.5 $122.9 NET INTEREST INCOME Non-Interest
Slide 13: Net Interest Margin Reflecting Lower-Risk Balance Sheet
Net Interest Margin Reflecting Lower-Risk Balance Sheet Average Balances Average Yield 1Q23 2Q23 3Q23 4Q23 1Q24 1Q23 2Q23 3Q23 4Q23 1Q24 Cash, cash equivalents and restricted cash $1,221 $1,513 $1,249 $1,191 $1,217 4.49% 5.06% 5.38% 5.47% 5.42% Growing balance Securities Available for Sale at FV $36
Slide 14: Disciplined Expense Management
Disciplined Expense Management Efficiency Ratio Total Non-Interest Expense1 (Non-Interest Expense as a % of Net Revenue) ($ in millions) Efficiency Ratio Non-Interest Expense Less Marketing 1Q23 2Q23 3Q23 4Q23 1Q24 Ma rketing as % of Net Revenue 73.2% 70.0% Compensation & Benefits 73.3 71.6 58.5 58.
Slide 15: Continued Profitability Increasing TBV per Common Share
Continued Profitability Increasing TBV per Common Share Pre-Provision Net Revenue (PPNR)1 Net Income ($ in millions) ($ in millions) $88.4 $13.7 $12.3 $10.2 $55.6 $48.5 1Q23 4Q23 1Q24 1Q23 4Q23 1Q24 Diluted Provision for ($70.6) ($41.9) ($31.9) EPS $0.13 $0.09 $0.11 Credit Losses Book Value Per Inco
Slide 16: Held for Investment Personal Loan Credit Performance by Vintage
Held for Investment Personal Loan Credit Performance by Vintage Expected lifetime net loss rates remain in-line with prior quarter expectations across all vintages Expected Personal Loans Lifetime Net Loss Rate1,3 2021 Vintage 2022 Vintage 2023 Vintage LEGEND 8.9% 8.9% 8.9% 8.9% § 2023 vintage incor
Slide 17: Illustrative Lifecycle of a $100M Personal Loan Portfolio
Illustrative Lifecycle of a $100M Personal Loan Portfolio Charge-offs ($) Peak at Approximately Six Quarters of Seasoning Portfolio Vintage Dynamics1 $0.5 Metric ($M) Year 1 Year 2 Year 3 Year 4+ Total $100 Average age of PL HFI Portfolio $ Ending UPB 65.3 31.8 10.6 0.0 na (as of 3/31/24) $0.4 $ Pro
Slide 18: 2Q24 Guidance
2Q24 Guidance Outlook Context § Increasing origination range from prior quarter 2Q24 Guidance reflecting expansion of new initiatives § PPNR assumes: Total § Marketplace revenue decreasing due to lower loan Originations $1.6B to $1.8B sales prices (driven by higher interest rates on the forward curv
Slide 19: Reconciliation of GAAP to Non-GAAP Measures: Pre-Provision Net Revenue
Reconciliation of GAAP to Non-GAAP Measures: Pre-Provision Net Revenue1 For the three months ended In thousands March 31, 2024 December 31, 2023 March 31, 2023 GAAP Net income $ 12,250 $ 10,155 $ 13,666 Less: Provision for credit losses (31,927) (41,907) (70,584) Less: Income tax expense (4,278) (3,
Slide 20: Reconciliation of GAAP to Non-GAAP Measures: Tangible Book Value Per Common Share
Reconciliation of GAAP to Non-GAAP Measures: Tangible Book Value Per Common Share1 In thousands, except share and per share data. March 31, 2024 December 31, 2023 March 31, 2023 GAAP common equity $ 1,266,286 $ 1,251,822 $ 1,190,742 Less: Goodwill (75,717) (75,717) (75,717) Less: Intangible assets (
Slide 21: LendingClub
= LendingClub