Orchard has released its "Quarterly Industry Report" for the third quarter; origination volume was lower in the third quarter, down approximately 21% from the previous quarter and 50% from peak origination volume in the fourth quarter of 2015; the third quarter is the third consecutive quarter of decreased origination volume; charge-offs have also increased; average borrowing rate has decreased 79 basis points from the previous quarter. Source
Experienced credit market executive Kathryn Petralia talks with Crowdfund Insider about fintech and the business growth of Kabbage; the firm has originated approximately $3 billion in loans to 100,000 US small businesses since 2011; it has developed lending partnerships with global banks Santander and Scotiabank; it has also been active in promoting small business lending through its development of the SMART Box in collaboration with the Innovative Lending Platform Association; other highlights from the interview include insight on fintech predictions and regulations, Kabbage's involvement with the Consumer Financial Data Rights group, initiatives within the Innovative Lending Platform Association and Petralia's career advice. Source
PPDAI plans for an IPO this month and co-founder Shaofeng Gu owns more than 25% of the business; Ning Tang of Yirendai, a US listed public company, owns 36% of the company; This year three Chinese fintech companies have gone public, raising $2.45 billion; Bloomberg provides data on the rise of the wealthiest billionaires in China. Source
Leading Canadian point-of-sale (POS) platform Flexiti Financial raised an oversubscribed CAD$6.25 million (USD$5 million) convertible debt offering; they will use the capital to accelerate growth and improve technology; according to Flexiti Financial Founder and CEO Peter Kalen: "Retailers across Canada are looking for unique solutions to increase sales and maintain customer loyalty in a highly competitive and shifting market. Flexiti Financial's POS lending platform has become an important tool in their sales arsenal, and this investment will help us better serve our retail partners while managing our growth across Canada." Source
Investors are continuously looking for new asset classes, equipment finance is one of the stronger performing areas and the presentation by Patricia Voorhees of The Alta Group at LendIt USA 2017 explains why this segment is ripe for capital; the total market is $1.7 trillion and currently only about $300 million is financed through term leases or loans; most equipment is put on some other form of credit like a credit card; the more technology that is enabled and the more chances to make a loan at the point of sale will allow for the market share to grow; Patricia also pointed out that ABS deals in the equipment space outperformed all other categories because the nature of the equipment is essential use and the integration of the finance providers in the transactions; equipment finance could be the next big opportunity, we will have to wait and see how it shakes out in the next couple of years. Source
The fund expects to provide a dividend of 15p per quarter by the end of the second quarter of 2018; this would represent a yield of 7.8%; the fund shared that it had a pipeline of attractive yielding assets of £400m and will increase share buybacks. Source
FinLab aims to help fintech startups that are helping American consumers; it is funded through a five-year grant from JPMorgan; in total 26 companies have worked or are working with Finlab; TechCrunch profiles how the innovation lab works which includes programs to help startups understand how the banking industry works and meetings in Washington with regulators. Source
Highlights partnerships announced by Wells Fargo and Blend, and Walmart and Google Express; reports on economists' comments at the Jackson Hole Economic Policy Symposium discussing post-crisis market regulations and areas for further improvement; also mentions Jamie Dimon's annual letter and the role for third party risk infrastructure. Source
The CreditEase Wealth Management Offshore Private Credit Fund (OPCF) has announced new investments in OnDeck and LendingHome; in 2015 the fund raised $80 million from Chinese clients, including high net worth and mass affluent investors, which it expects to be fully invested by March 2017; a $30 million investment in OnDeck and LendingHome adds to previous investments in Avant and Prosper in 2016; the firm also says it is planning to fundraise for another offshore private credit fund, OPCF II; CreditEase is targeting $200 million for this fund and its investments will likely be similar with a different fund structure, varying durations, new geographies and new types of credit products. Source
Yirendai, an affiliate of CreditEase, is the only Chinese online lender publicly traded on a US exchange; its stock price closed at $29.29 prior to the company's earnings announcement after the closing bell on March 15; year-to-date the stock is up 41.36%; the earnings results showed revenue of $154.3 million for the fourth quarter, beating estimates by $19.38 million and increasing 137% from the comparable quarter; revenue for the year was $466.4 million an increase from $190.1 million in 2015; earnings per share for the fourth quarter were $0.91, beating estimates by $0.58 and increasing 287% from the comparable quarter; earnings per share for the year were $2.72 an increase from $0.79. Source