LendingClub Reports Third Quarter 2021 Results

·6 min read

Record Revenues Up 20% Sequentially

Net Income up 190% Sequentially

Raising Full Year Outlook

SAN FRANCISCO, Oct. 27, 2021 /PRNewswire/ -- LendingClub Corporation (NYSE: LC), the parent company of LendingClub Bank, America's leading digital marketplace bank, today announced financial results for the third quarter ended September 30, 2021.

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.
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.

"Our strong revenue and earnings growth trajectory has become evident following our transformation into a digital marketplace bank," said Scott Sanborn, LendingClub's CEO. "Our success continues to be driven by our competitive advantages, including our growing base of 3.8 million members, our exceptional data science capabilities, and our proven marketplace model. With our enhanced operating leverage, digital first infrastructure, and the ongoing move of consumers toward online banking, there's no better time to grow a next generation digital bank like LendingClub."

Record Revenue and Net Income Reflects Strong Execution and Business Model Transformation.

  • Record revenue of $246.2 million with total sequential revenue growth of 20% outpacing origination growth of 14%.

  • Record net income of $27.2 million, up 190% sequentially, highlighting positive operating leverage in the fully integrated digital bank business model.

  • Net income of $27.2 million and earnings per share of $0.26 were negatively impacted by $51.5 million of notable items: $34.0 million of Current Expected Credit Loss (CECL) provisioning and $17.5 million of net revenue deferrals both driven by strong retained loan growth. These items reduced our earnings per share by $0.49 in the third quarter of 2021.


Three Months Ended

($ in millions)

September 30,
2021


June 30,
2021


QoQ
$ Change


QoQ
% Change

Loan originations(1)

$

3,106.7



$

2,722.4



$

384.3



14

%

Total revenue

$

246.2



$

204.4



$

41.8



20

%

Consolidated net income

$

27.2



$

9.4



$

17.8



190

%

(1)

Includes unsecured personal loans, auto loans, and education and patient finance loans only.

Financial Outlook – Raising Full Year Targets

(millions)

Fourth Quarter

2021

Full Year

2021

Versus Prior

Full Year 2021 Guidance

Loan originations(1)

$2.8B to $3.0B

$10.1B to $10.3B

+$100M to +$300M

Total revenue

$240M to $250M

$796M to $806M

+$26M to +$46M

Consolidated net income

$20M to $25M

$9M to $14M

+$17M to +$22M

(1)

Includes unsecured personal loans, auto loans, and education and patient finance loans only.

Notable Items Impacting Q3'21 Consolidated Net Income

(millions)

Consolidated Net
Income Impact(1)

Per
Diluted
Share
Impact

Commentary

Revenue deferrals, net of amortization

$(17.5)

$0.17

Origination fee and cost deferrals,
net of interest income amortization during
the period

Provision for credit losses, less net charge-offs

$(34.0)

$0.32

Primarily for consumer loans originated
and retained in the quarter

Total

$(51.5)

$0.49


(1)

Amounts presented net of tax.

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 $65 billion in loans, our artificial intelligence-driven 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 3.8 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 third quarter 2021 webcast and teleconference is scheduled to begin at 2:00 p.m. Pacific Time (or 5:00 p.m. Eastern Time) on Wednesday, October 27, 2021. 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 (888) 317-6003, or outside the U.S. +1 (412) 317-6061, with conference ID 3514635, 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 November 3, 2021, by calling +1 (877) 344-7529 or outside the U.S. +1 (412) 317-0088, with Conference ID 10160701. 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

Safe Harbor Statement

Some of the statements above, including statements regarding our competitive advantages, ability to grow our business, 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; competition; overall economic conditions; 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 Quarterly Report on Form 10-Q and Annual Report on Form 10-K, each as filed with the Securities and Exchange Commission, as well as our subsequent reports on Form 10-Q and 10-K each as filed 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)


The information in the following tables is presented for the consolidated LendingClub Corporation, unless specifically noted for LendingClub Bank, the company's wholly-owned subsidiary:



As of and for the three months ended


% Change


September 30,
2021


June 30,
2021


March 31,

2021


December 31,

2020


September 30,
2020


Q/Q


Y/Y

Operating Highlights:

Non-interest income

$

180,878



$

158,476



$

87,334



$

72,597



$

57,750



14

%


213

%

Net interest income

$

65,288



$

45,905



$

18,506



$

2,899



13,294



42

%


391

%

Total net revenue

$

246,166



$

204,381



$

105,840



$

75,496



$

71,044



20

%


246

%















Consolidated net income (loss)

$

27,185



$

9,371



$

(47,084)



$

(26,655)



$

(34,325)



190

%


N/M
















EPS – basic

$

0.27



$

0.10



$

(0.49)



$

(0.29)



$

(0.38)



170

%


N/M


EPS – diluted

$

0.26



$

0.09



$

(0.49)



$

(0.29)



$

(0.38)



189

%


N/M
















LendingClub Bank Performance Metrics:

Net interest margin

7.1

%


5.5

%


3.3

%


N/A



N/A






Efficiency ratio (1)

67.5

%


69.0

%


104.8

%


N/A



N/A






Return on average equity (ROE)

26.5

%


34.7

%


N/A



N/A



N/A






Return on average total assets (ROA)

3.7

%


4.7

%


N/A



N/A



N/A




















LendingClub Bank Capital Ratios:

Common Equity Tier 1 Capital Ratio

18.0

%


18.7

%


20.9

%


N/A



N/A






Tier 1 Leverage Ratio

14.1

%


13.5

%


12.9

%


N/A



N/A




















Consolidated LendingClub Corporation Performance Metrics:

Net interest margin

6.3

%


4.7

%


1.8

%


0.7

%


2.9

%





Efficiency ratio (1)

72.6

%


78.4

%


126.8

%


N/A



N/A






Return on average equity (ROE)

13.8

%


5.0

%


N/A



N/A



N/A






Return on average total assets (ROA)

2.4

%


0.8

%


N/A



N/A



N/A






Marketing expense as a % of loan originations

1.6

%


1.3

%


1.3

%


0.9

%


0.4

%



















Loan originations (in millions) (2):














Marketplace loans

$

2,471



$

2,182



$

1,139



$

912



$

584



13

%


323

%

Loan originations held for investment

$

636



$

541



$

344



$



$



18

%


N/A


Total loan originations

$

3,107



$

2,722



$

1,483



$

912



$

584



14

%


432

%















Servicing portfolio AUM

(in millions) (3)

$

11,592



$

10,741



$

10,271



$

11,002



$

12,267



8

%


(6)

%









...

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