LendingClub reported Q1 2022 results last week, and the company’s earnings call was one of the few bright spots in an otherwise dark month for the markets. The company managed to beat its quarterly guidance, as well as revised upwards the guidance for the full year.
Jevgenijs, a question for you b/c your thesis deemphasizes originations growth and focuses on the newer income stream from retaining loans on the balance sheet. LC seemed to indicate in their Q4 reporting that the average loan lifetime is ~18 months (with prepays somewhat elevated given currently strong consumer balance sheets). If this remains the case and originations experience only modest growth (say 5-10% annually), how large can LC's retained look book grow if they continue to retain at the upper end of current guidance (25%) of quarterly originations? Considering the avg loan lifetime, have you considered how large the book can ultimately grow before originations growth becomes the limiting factor?
Jevgenijs, a question for you b/c your thesis deemphasizes originations growth and focuses on the newer income stream from retaining loans on the balance sheet. LC seemed to indicate in their Q4 reporting that the average loan lifetime is ~18 months (with prepays somewhat elevated given currently strong consumer balance sheets). If this remains the case and originations experience only modest growth (say 5-10% annually), how large can LC's retained look book grow if they continue to retain at the upper end of current guidance (25%) of quarterly originations? Considering the avg loan lifetime, have you considered how large the book can ultimately grow before originations growth becomes the limiting factor?