LendingClub Reports Second Quarter 2022 Results
07/27/2022 - 04:07 PM
Record Revenue of $330 million
Reported Net Income of $182 million Including Income Tax Benefit of $135 million
Record Net Income of $47 million Excluding Income Tax Benefit
SAN FRANCISCO , July 27, 2022 /PRNewswire/ -- LendingClub Corporation (NYSE: LC), the parent company of LendingClub Bank, America's leading digital marketplace bank, today announced financial results for the second quarter ended June 30, 2022.
"Our strong execution, marketplace bank model, member and data advantages, and our continued focus on prudent underwriting have all contributed to an incredible first half of the year with records set for both revenue and profitability," said Scott Sanborn , LendingClub CEO. "Despite the more challenging economic backdrop and increased uncertainty, we are well positioned to navigate through this dynamic environment."
Record Second Quarter 2022 Results
Revenue of $330.1 million grew 61% year-over-year, driven by growth in net interest income and marketplace revenue. Recurring stream of net interest income increased 153% year-over-year to $116.2 million . LendingClub Bank's net interest margin expanded to 8.7% from 5.5% a year earlier, primarily reflecting growth in consumer loans which generate a higher yield. Total loans held for investment (excluding PPP) grew 106% from June 30, 2021 , reflecting growth in personal loan originations and an increase in originations retained in the held for investment portfolio. The percentage of originations held for investment increased to 27% from 20% a year earlier as the company reinvested earnings into loan retention to drive growth in recurring revenue. Marketplace revenue of $206.4 million grew 36% year-over-year, reflecting growth in marketplace originations. Deposits of $4.5 billion were up 78% from June 30, 2021 , supporting growth in loans held for investment. The efficiency ratio improved to 63% from 78% a year earlier as the company continued to manage expenses prudently while generating strong revenue growth. LendingClub's credit quality remained better than the industry, with delinquency rates remaining below pre-pandemic levels. Credit quality of the company's held for investment personal loan portfolio also remained strong reflecting the prime credit profile of its borrowers with an average FICO of 730. Provision for credit losses increased to $70.6 million from $34.6 million in the second quarter of 2021, primarily reflecting growth of 106% in loans held for investment (excluding PPP) from June 30, 2021 . Net income of $182.1 million increased $172.7 million year-over-year. Net income for the second quarter of 2022 included an income tax benefit of $132.0 million , reflecting the release of a $135.3 million valuation allowance against the company's deferred tax assets, partially offset by a $3.3 million state income tax expense, due to the company's business model transition and resulting increase in profitability and the expectation of continued profitability. Net income excluding the income tax benefit was $46.8 million , up 399% year-over-year. Total equity was up $316.7 million or 42% from June 30, 2021 primarily reflecting net income generated over the period and the release of a deferred tax asset valuation allowance. Diluted earnings per share of $1.73 compared to earnings of $0.09 per share in the second quarter of 2021. Results in the second quarter of 2022 included an income tax benefit of $1.28 per share due to the release of a deferred tax asset valuation allowance. The improvement in diluted earnings per share from a year earlier reflected revenue growth and increased operating efficiency, as well as the benefit from the release of the deferred tax asset valuation allowance. Excluding the income tax benefit, diluted earnings per share of $0.45 was up 400% year-over-year. Pre-tax, pre-provision income of $120.7 million increased 173% year-over-year, consistent with revenue growth and improved operating efficiency which drove growth in net income. Three Months Ended
($ in millions)
June 30, 2022
March 31, 2022
June 30, 2021
Total net revenue
$ 330.1
$ 289.5
$ 204.4
Non-interest expense
209.4
191.2
160.1
Pre-tax, pre-provision income
120.7
98.3
44.3
Provision for credit losses
70.6
52.5
34.6
Income before income tax benefit (expense)
50.1
45.8
9.6
Income tax benefit (expense)
132.0
(5.0)
(0.2)
Net income
$ 182.1
$ 40.8
$ 9.4
Diluted EPS
$ 1.73
$ 0.39
$ 0.09
Income tax benefit from release of tax valuation allowance
$ 135.3
$ —
$ —
Net income excluding income tax benefit (1)
$ 46.8
$ 40.8
$ 9.4
Diluted EPS excluding income tax benefit (1)
$ 0.45
$ 0.39
$ 0.09
(1)
Second quarter 2022 income tax benefit of $135.3 million due to the release of a deferred tax asset valuation allowance. See page 3 of this release for additional information on our use of Non-GAAP Financial Measures.
Financial Outlook
The company reaffirmed full year revenue and net income guidance for 2022 (excluding the income tax benefit from release of a deferred tax asset valuation allowance).
(millions)
Third Quarter
2022
Full Year
2022
Total revenue
$280M to $300M
$1.15B to $1.25B
Net income
$30M to $40M
$280M to $300M
Income tax benefit from release of tax valuation allowance
—
$135.3M
Net income excluding income tax benefit
$30M to $40M
$145M to $165M
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 $75 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 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 second quarter 2022 webcast and teleconference is scheduled to begin at 2:00 p.m. Pacific Time (or 5:00 p.m. Eastern Time) on Wednesday, July 27, 2022. 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 (844) 200-6205, or outside the U.S. +1 (929) 526-1599, with Access Code 696569, 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 August 3, 2022 , by calling +1 (866) 813-9403 or outside the U.S. +44 (204) 525-0658, with Access Code 945301. 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: Net Income Excluding Income Tax Benefit and Diluted EPS Excluding Income Tax Benefit. Our non-GAAP 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 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 Net Income Excluding Income Tax Benefit and Diluted EPS Excluding Income Tax Benefit are important measures because they directly reflect the financial performance of our business operations. Net Income Excluding Income Tax Benefit adjusts for the release of a deferred tax asset valuation allowance in the second quarter of 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.
For a reconciliation of such measures to the nearest GAAP measure, please refer to the table on page 2 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; 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 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)
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
June 30, 2022
March 31, 2022
December 31,
2021
September 30,
2021
June 30, 2021
Q/Q
Y/Y
Operating Highlights:
Non-interest income
$ 213,832
$ 189,857
$ 179,111
$ 180,878
$ 158,476
13 %
35 %
Net interest income
116,226
99,680
83,132
65,288
45,905
17 %
153 %
Total net revenue
330,058
289,537
262,243
246,166
204,381
14 %
61 %
Non-interest expense
209,386
191,204
188,220
178,775
160,139
10 %
31 %
Pre-tax, pre-provision income
120,672
98,333
74,023
67,391
44,242
23 %
173 %
Provision for credit losses
70,566
52,509
45,149
37,524
34,634
34 %
104 %
Income before income tax benefit
50,106
45,824
28,874
29,867
9,608
9 %
422 %
Income tax benefit (expense)
131,954
(4,988)
234
(2,682)
(237)
N/M
N/M
Net income
182,060
40,836
29,108
27,185
9,371
N/M
N/M
Income tax benefit from release of tax valuation allowance
135,300
—
—
—
—
N/M
N/M
Net income excluding income tax benefit (1)
$ 46,760
$ 40,836
$ 29,108
$ 27,185
$ 9,371
15 %
399 %
Basic EPS – common stockholders
$ 1.77
$ 0.40
$ 0.29
$ 0.27
$ 0.10
N/M
N/M
Diluted EPS – common stockholders
$ 1.73
$ 0.39
$ 0.27
$ 0.26
$ 0.09
N/M
N/M
Diluted EPS excluding income tax benefit (1)
$ 0.45
$ 0.39
$ 0.27
$ 0.26
$ 0.09
15 %
400 %
LendingClub Bank Performance Metrics:
Net interest margin
8.7 %
8.6 %
8.3 %
7.1 %
5.5 %
Efficiency ratio (2)
60.5 %
63.6 %
69.5 %
67.5 %
69.0 %
Return on average equity (ROE)
21.5 %
22.5 %
21.7 %
26.5 %
34.7 %
Return on average total assets (ROA)
3.0 %
3.1 %
3.1 %
3.7 %
4.7 %
LendingClub Bank Capital Ratios:
Common Equity Tier 1 Capital Ratio
16.7 %
16.0 %
16.7 %
18.0 %
18.7 %
Tier 1 Leverage Ratio
13.4 %
13.2 %
14.3 %
14.1 %
13.5 %
Consolidated LendingClub Corporation Performance Metrics:
Net interest margin
8.5 %
8.3 %
7.6 %
6.3 %
4.7 %
Efficiency ratio (2)
63.4 %
66.0 %
71.8 %
72.6 %
78.4 %
Return on average equity (ROE)
33.8 %
18.7 %
14.1 %
13.8 %
5.0 %
Return on average total assets (ROA)
5.5 %
3.1 %
2.4 %
2.4 %
0.8 %
Marketing expense as a % of loan originations
1.6 %
1.7 %
1.7 %
1.6 %
1.3 %
Loan originations (in millions) (3) :
Total loan originations
$ 3,840
$ 3,217
$ 3,069
$ 3,107
$ 2,722
19 %
41 %
Marketplace loans
$ 2,819
$ 2,360
$ 2,308
$ 2,471
$ 2,182
19 %
29 %
Loan originations held for investment
$ 1,021
$ 856
$ 761
$ 636
$ 541
19 %
89 %
Loan originations held for investment as a % of total loan originations
27 %
27 %
25 %
20 %
20 %
Servicing portfolio AUM (in millions) (4)
$ 14,783
$ 13,341
$ 12,463
$ 11,592
$ 10,741
11 %
38 %
Balance Sheet Data:
Loans and leases held for investment, net, excluding PPP loans
$ 3,692,667
$ 3,049,325
$ 2,486,440
$ 2,235,698
$ 1,791,492
21 %
106 %
PPP loans
$ 118,794
$ 184,986
$ 268,297
$ 367,558
$ 507,553
(36) %
(77) %
Total loans and leases held for investment, net
$ 3,811,461
$ 3,234,311
$ 2,754,737
$ 2,603,256
$ 2,299,045
18 %
66 %
Total assets
$ 6,186,765
$ 5,574,425
$ 4,900,319
$ 4,750,760
$ 4,370,101
11 %
42 %
Total deposits
$ 4,527,672
$ 3,977,477
$ 3,135,788
$ 2,838,719
$ 2,539,704
14 %
78 %
Total liabilities
$ 5,107,648
$ 4,686,991
$ 4,050,077
$ 3,945,970
$ 3,607,742
9 %
42 %
Total equity
$ 1,079,117
$ 887,434
$ 850,242
$ 804,790
$ 762,359
22 %
42 %
Allowance Ratios:
Allowance for loan and lease losses to total loans and leases held for investment
6.0 %
5.5 %
5.0 %
3.9 %
3.0 %
Allowance for loan and lease losses to total loans and leases held for investment, excluding PPP loans
6.2 %
5.8 %
5.5 %
4.5 %
3.8 %
Allowance for loan and lease losses to consumer loans and leases held for investment
6.9 %
6.6 %
6.4 %
5.2 %
4.3 %
Allowance for loan and lease losses to commercial loans and leases held for investment
2.0 %
1.8 %
1.8 %
1.6 %
1.5 %
Allowance for loan and lease losses to commercial loans and leases held for investment, excluding PPP loans
2.3 %
2.3 %
2.6 %
2.6 %
2.8 %
N/M – Not meaningful
N/A – Not applicable
(1)
Second quarter 2022 income tax benefit of $135.3 million due to the release of a deferred tax asset valuation allowance. See page 3 of this release for additional information on our use of Non-GAAP Financial Measures.
(2)
Calculated as the ratio of non-interest expense to total net revenue.
(3)
Includes unsecured personal loans, auto loans, and education and patient finance loans only.
(4)
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.
LENDINGCLUB CORPORATION
LOANS AND LEASES HELD FOR INVESTMENT
(In thousands, except percentages or as noted)
(Unaudited)
June 30, 2022
December 31, 2021
Unsecured personal
$ 2,964,950
$ 1,804,578
Residential mortgages
176,900
151,362
Secured consumer
142,824
65,976
Total consumer loans held for investment
3,284,674
2,021,916
Equipment finance (1)
164,104
149,155
Commercial real estate
339,524
310,399
Commercial and industrial (2)
266,419
417,656
Total commercial loans and leases held for investment
770,047
877,210
Total loans and leases held for investment
4,054,721
2,899,126
Allowance for loan and lease losses
(243,260)
(144,389)
Loans and leases held for investment, net
$ 3,811,461
$ 2,754,737
(1)
Comprised of sales-type leases for equipment.
(2)
Includes $118.8 million and $268.3 million of Paycheck Protection Program (PPP) loans as of June 30, 2022 and December 31, 2021, 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, except percentages or as noted)
(Unaudited)
Three Months Ended
June 30, 2022
December 31, 2021
Consumer
Commercial
Total
Consumer
Commercial
Total
Allowance for loan and lease losses, beginning of period
$ 173,857
$ 14,128
$ 187,985
$ 88,631
$ 16,105
$ 104,736
Credit loss expense for loans and leases held for investment
68,314
1,739
70,053
45,595
(306)
45,289
Charge-offs
(14,707)
(1,145)
(15,852)
(5,557)
(313)
(5,870)
Recoveries
720
354
1,074
143
91
234
Allowance for loan and lease losses, end of period
$ 228,184
$ 15,076
$ 243,260
$ 128,812
$ 15,577
$ 144,389
LENDINGCLUB CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except share and per share data)
(Unaudited)
Three Months Ended
Change (%)
June 30, 2022
March 31, 2022
June 30, 2021
Q2 2022
vs
Q2 2021
Q2 2022
vs
Q1 2022
Non-interest income:
Marketplace revenue (1)
$ 206,384
$ 179,966
$ 151,735
36 %
15 %
Other non-interest income
7,448
9,891
6,741
10 %
(25) %
Total non-interest income
213,832
189,857
158,476
35 %
13 %
Interest income:
Interest on loans held for sale
7,130
7,450
8,694
(18) %
(4) %
Interest and fees on loans and leases held for investment
108,911
91,442
39,068
179 %
19 %
Interest on retail and certificate loans held for investment at fair value
5,091
6,969
16,014
(68) %
(27) %
Interest on other loans held for investment at fair value
631
593
1,222
(48) %
6 %
Interest on securities available for sale
4,426
4,511
2,539
74 %
(2) %
Other interest income
2,279
688
190
N/M
231 %
Total interest income
128,468
111,653
67,727
90 %
15 %
Interest expense:
Interest on deposits
6,078
3,438
1,699
258 %
77 %
Interest on short-term borrowings
417
435
1,003
(58) %
(4) %
Interest on retail notes, certificates and secured borrowings
5,091
6,969
16,014
(68) %
(27) %
Interest on Structured Program borrowings
360
764
2,668
(87) %
(53) %
Interest on other long-term debt
296
367
438
(32) %
(19) %
Total interest expense
12,242
11,973
21,822
(44) %
2 %
Net interest income
116,226
99,680
45,905
153 %
17 %
Total net revenue
330,058
289,537
204,381
61 %
14 %
Provision for credit losses
70,566
52,509
34,634
104 %
34 %
Non-interest expense:
Compensation and benefits
85,103
81,610
71,925
18 %
4 %
Marketing
61,497
55,080
35,107
75 %
12 %
Equipment and software
12,461
11,046
9,281
34 %
13 %
Occupancy
6,209
6,019
6,157
1 %
3 %
Depreciation and amortization
10,557
11,039
11,508
(8) %
(4) %
Professional services
16,138
12,406
11,520
40 %
30 %
Other non-interest expense
17,421
14,004
14,641
19 %
24 %
Total non-interest expense
209,386
191,204
160,139
31 %
10 %
Income before income tax benefit (expense)
50,106
45,824
9,608
422 %
9 %
Income tax benefit (expense)
131,954
(4,988)
(237)
N/M
N/M
Net income
$ 182,060
$ 40,836
$ 9,371
N/M
N/M
Net income per share:
Basic EPS – common stockholders
$ 1.77
$ 0.40
$ 0.10
N/M
N/M
Diluted EPS – common stockholders
$ 1.73
$ 0.39
$ 0.09
N/M
N/M
Weighted-average common shares – Basic
102,776,867
101,493,561
97,785,089
5 %
1 %
Weighted-average common shares – Diluted
105,042,626
105,052,904
102,031,088
3 %
— %
N/M – Not meaningful
(1)
Marketplace revenue consists of the following:
LENDINGCLUB CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Continued)
(In thousands, except share and per share data)
(Unaudited)
Three Months Ended
Change (%)
June 30, 2022
March 31, 2022
June 30, 2021
Q2 2022
vs
Q2 2021
Q2 2022
vs
Q1 2022
Origination fees
$ 149,252
$ 122,093
$ 113,802
31 %
22 %
Servicing fees
18,166
18,514
22,714
(20) %
(2) %
Gain on sales of loans
29,319
24,110
19,317
52 %
22 %
Net fair value adjustments
9,647
15,249
(4,098)
N/M
(37) %
Total marketplace revenue
$ 206,384
$ 179,966
$ 151,735
36 %
15 %
LENDINGCLUB CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS BY SEGMENT
(In Thousands, Except Share and Per Share Amounts)
(Unaudited)
LendingClub
Bank
LendingClub
Corporation
(Parent only)
Intercompany
Eliminations
Total
June 30, 2022
December 31, 2021
June 30, 2022
December 31, 2021
June 30, 2022
December 31, 2021
June 30, 2022
December 31, 2021
Assets
Total cash and cash equivalents
$ 1,004,602
$ 659,919
$ 95,755
$ 88,268
$ (58,377)
$ (61,061)
$ 1,041,980
$ 687,126
Restricted cash
—
—
66,044
76,540
(5,792)
(80)
60,252
76,460
Securities available for sale at fair value
370,567
205,730
32,427
57,800
—
—
402,994
263,530
Loans held for sale
62,811
335,449
—
55,799
—
—
62,811
391,248
Loans and leases held for investment, net
3,811,461
2,754,737
—
—
—
—
3,811,461
2,754,737
Retail and certificate loans held for investment at fair value
—
—
122,078
229,719
—
—
122,078
229,719
Other loans held for investment at fair value
—
—
20,583
21,240
—
—
20,583
21,240
Property, equipment and software, net
73,002
36,424
46,974
61,572
—
—
119,976
97,996
Investment in subsidiary
—
—
634,102
557,577
(634,102)
(557,577)
—
—
Goodwill
75,717
75,717
—
—
—
—
75,717
75,717
Other assets
264,600
254,075
230,379
168,042
(26,066)
(119,571)
468,913
302,546
Total assets
5,662,760
4,322,051
1,248,342
1,316,557
(724,337)
(738,289)
6,186,765
4,900,319
Liabilities and Equity
Total deposits
4,591,841
3,196,929
—
—
(64,169)
(61,141)
4,527,672
3,135,788
Short-term borrowings
165
165
7,818
27,615
—
—
7,983
27,780
Advances from PPPLF
123,444
271,933
—
—
—
—
123,444
271,933
Retail notes, certificates and secured borrowings at fair value
—
—
122,078
229,719
—
—
122,078
229,719
Payable on Structured Program borrowings
—
—
15,274
65,451
—
—
15,274
65,451
Other long-term debt
—
—
15,300
15,455
—
—
15,300
15,455
Other liabilities
187,089
218,775
134,874
150,727
(26,066)
(65,551)
295,897
303,951
Total liabilities
4,902,539
3,687,802
295,344
488,967
(90,235)
(126,692)
5,107,648
4,050,077
Total equity
760,221
634,249
952,998
827,590
(634,102)
(611,597)
1,079,117
850,242
Total liabilities and equity
$ 5,662,760
$ 4,322,051
$ 1,248,342
$ 1,316,557
$ (724,337)
$ (738,289)
$ 6,186,765
$ 4,900,319
LENDINGCLUB CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME BY SEGMENT
(In thousands, except share and per share data)
(Unaudited)
Three Months Ended June 30, 2022
LendingClub
Bank
LendingClub
Corporation
(Parent only)
Intercompany
Eliminations
Total
Non-interest income:
Marketplace revenue
$ 191,087
$ 11,167
$ 4,130
$ 206,384
Other non-interest income
20,041
3,914
(16,507)
7,448
Total non-interest income
211,128
15,081
(12,377)
213,832
Interest income:
Interest income
120,152
8,316
—
128,468
Interest expense
(6,213)
(6,029)
—
(12,242)
Net interest income
113,939
2,287
—
116,226
Total net revenue
325,067
17,368
(12,377)
330,058
Provision for credit losses
(70,566)
—
—
(70,566)
Non-interest expense
(196,636)
(25,127)
12,377
(209,386)
Income (Loss) before income tax benefit (expense)
57,865
(7,759)
—
50,106
Income tax benefit (expense)
(17,318)
85,864
63,408
131,954
Net income
$ 40,547
$ 78,105
$ 63,408
$ 182,060
Three Months Ended March 31, 2022
LendingClub
Bank
LendingClub
Corporation
(Parent only)
Intercompany
Eliminations
Total
Non-interest income:
Marketplace revenue
$ 164,835
$ 15,131
$ —
$ 179,966
Other non-interest income
19,498
4,223
(13,830)
9,891
Total non-interest income
184,333
19,354
(13,830)
189,857
Interest income:
Interest income
99,823
11,830
—
111,653
Interest expense
(3,644)
(8,329)
—
(11,973)
Net interest income
96,179
3,501
—
99,680
Total net revenue
280,512
22,855
(13,830)
289,537
Provision for credit losses
(52,509)
—
—
(52,509)
Non-interest expense
(178,459)
(26,575)
13,830
(191,204)
Income (Loss) before income tax benefit (expense)
49,544
(3,720)
—
45,824
Income tax benefit (expense)
(12,355)
17,727
(10,360)
(4,988)
Net income
$ 37,189
$ 14,007
$ (10,360)
$ 40,836
Three Months Ended June 30, 2021
LendingClub
Bank
LendingClub
Corporation
(Parent only)
Intercompany
Eliminations
Total
Non-interest income:
Marketplace revenue
$ 128,714
$ 23,021
$ —
$ 151,735
Other non-interest income
28,340
4,281
(25,880)
6,741
Total non-interest income
157,054
27,302
(25,880)
158,476
Interest income:
Interest income
45,325
22,402
—
67,727
Interest expense
(1,972)
(19,850)
—
(21,822)
Net interest income
43,353
2,552
—
45,905
Total net revenue
200,407
29,854
(25,880)
204,381
Reversal of (Provision for) credit losses
(34,956)
322
—
(34,634)
Non-interest expense
(138,182)
(47,837)
25,880
(160,139)
Income (Loss) before income tax benefit (expense)
27,269
(17,661)
—
9,608
Income tax benefit (expense)
12,513
8,922
(21,672)
(237)
Net income (loss)
$ 39,782
$ (8,739)
$ (21,672)
$ 9,371
LENDINGCLUB BANK
NET INTEREST INCOME
(In thousands, except percentages or as noted)
(Unaudited)
LendingClub Bank
Three Months Ended
June 30, 2022
Three Months Ended
March 31, 2022
Three Months Ended
June 30, 2021
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 (1)
Cash, cash equivalents, restricted cash and other
$ 964,161
$ 2,214
0.92 %
$ 829,707
$ 683
0.33 %
$ 551,895
$ 186
0.13 %
Securities available for sale at fair value
369,012
2,259
2.45 %
274,089
1,276
1.86 %
165,579
348
0.84 %
Loans held for sale
149,506
6,768
18.11 %
228,529
6,422
11.24 %
144,037
5,723
15.89 %
Loans and leases held for investment:
Unsecured personal loans
2,692,148
95,529
14.19 %
2,060,323
78,376
15.22 %
511,787
19,499
15.24 %
Secured consumer loans
268,091
2,351
3.51 %
232,235
2,275
3.92 %
532,426
5,173
3.89 %
Commercial loans and leases
644,002
8,732
5.42 %
620,660
7,588
4.89 %
623,735
9,062
5.81 %
PPP loans
149,454
2,299
6.15 %
222,517
3,203
5.76 %
615,942
5,334
3.46 %
Loans and leases held for investment
3,753,695
108,911
11.61 %
3,135,735
91,442
11.66 %
2,283,890
39,068
6.84 %
Total interest-earning assets
5,236,374
120,152
9.18 %
4,468,060
99,823
8.94 %
3,145,401
45,325
5.76 %
Cash and due from banks
31,142
46,117
34,612
Allowance for loan and lease losses
(202,904)
(163,631)
(51,109)
Other non-interest earning assets
424,586
390,066
221,870
Total assets
$ 5,489,198
$ 4,740,612
$ 3,350,774
Interest-bearing liabilities
Interest-bearing deposits
Checking and money market accounts
$ 2,463,710
$ 2,664
0.43 %
$ 2,240,450
$ 1,724
0.31 %
$ 2,071,112
$ 1,618
0.31 %
Savings accounts and certificates of deposit
1,555,607
3,414
0.88 %
1,071,133
1,714
0.65 %
301,939
81
0.11 %
Interest-bearing deposits
4,019,317
6,078
0.61 %
3,311,583
3,438
0.42 %
2,373,051
1,699
0.29 %
Short-term borrowings
164
—
— %
165
—
— %
2,138
1
0.06 %
Advances from PPPLF
151,278
135
0.36 %
234,872
206
0.35 %
312,168
272
0.35 %
Other long-term debt
—
—
— %
—
—
— %
708
—
— %
Total interest-bearing liabilities
4,170,759
6,213
0.60 %
3,546,620
3,644
0.42 %
2,688,065
1,972
0.29 %
Non-interest bearing deposits
399,949
300,218
102,709
Other liabilities
163,095
232,018
100,835
Total liabilities
$ 4,733,803
$ 4,078,856
$ 2,891,609
Total equity
$ 755,395
$ 661,756
$ 459,165
Total liabilities and equity
$ 5,489,198
$ 4,740,612
$ 3,350,774
Interest rate spread
8.58 %
8.52 %
5.47 %
Net interest income and net interest margin
$ 113,939
8.70 %
$ 96,179
8.61 %
$ 43,353
5.51 %
(1)
Nonaccrual loans and any related income are included in their respective loan categories.
LENDINGCLUB CORPORATION
NET INTEREST INCOME (Continued)
(In thousands, except percentages or as noted)
(Unaudited)
Consolidated LendingClub Corporation (1)
Three Months Ended
June 30, 2022
Three Months Ended
March 31, 2022
Three Months Ended
June 30, 2021
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
$ 1,023,192
$ 2,279
0.89 %
$ 892,921
$ 688
0.31 %
$ 642,182
$ 190
0.12 %
Securities available for sale at fair value
409,327
4,426
4.32 %
325,155
4,511
5.55 %
273,956
2,539
3.71 %
Loans held for sale
156,503
7,130
18.22 %
255,139
7,450
11.68 %
243,445
8,694
14.29 %
Loans and leases held for investment:
Unsecured personal loans
2,692,148
95,529
14.19 %
2,060,323
78,376
15.22 %
511,787
19,499
15.24 %
Secured consumer loans
268,091
2,351
3.51 %
232,235
2,275
3.92 %
532,426
5,173
3.89 %
Commercial loans and leases
644,002
8,732
5.42 %
620,660
7,588
4.89 %
623,735
9,062
5.81 %
PPP loans
149,454
2,299
6.15 %
222,517
3,203
5.76 %
615,942
5,334
3.46 %
Loans and leases held for investment
3,753,695
108,911
11.61 %
3,135,735
91,442
11.66 %
2,283,890
39,068
6.84 %
Retail and certificate loans held for investment at fair value
144,613
5,091
14.08 %
198,813
6,969
14.02 %
448,822
16,014
14.27 %
Other loans held for investment at fair value
16,991
631
14.85 %
18,523
593
12.80 %
38,662
1,222
12.64 %
Total interest-earning assets
5,504,321
128,468
9.34 %
4,826,286
111,653
9.25 %
3,930,957
67,727
6.89 %
Cash and due from banks and restricted cash
75,517
92,683
144,897
Allowance for loan and lease losses
(202,904)
(163,631)
(51,109)
Other non-interest earning assets
490,412
486,363
447,826
Total assets
$ 5,867,346
$ 5,241,701
$ 4,472,571
Interest-bearing liabilities
Interest-bearing deposits:
Checking and money market accounts
$ 2,463,710
$ 2,664
0.43 %
$ 2,240,450
$ 1,724
0.31 %
$ 2,071,112
$ 1,618
0.31 %
Savings accounts and certificates of deposit
1,555,607
3,414
0.88 %
1,071,133
1,714
0.64 %
301,939
81
0.11 %
Interest-bearing deposits
4,019,317
6,078
0.61 %
3,311,583
3,438
0.42 %
2,373,051
1,699
0.29 %
Short-term borrowings
10,874
417
15.35 %
20,371
435
8.56 %
79,511
1,003
5.05 %
Advances from PPPLF
151,278
135
0.36 %
234,872
206
0.35 %
312,168
272
0.35 %
Retail notes, certificates and secured borrowings
144,613
5,091
14.08 %
198,813
6,969
14.02 %
449,057
16,014
14.27 %
Structured Program borrowings
18,439
360
7.81 %
42,026
764
7.29 %
121,738
2,668
8.77 %
Other long-term debt
15,357
161
4.20 %
15,421
161
4.19 %
16,404
166
4.04 %
Total interest-bearing liabilities
4,359,878
12,242
1.12 %
3,823,086
11,973
1.25 %
3,351,929
21,822
2.61 %
Non-interest bearing deposits
292,750
227,337
92,588
Other liabilities
261,795
319,241
276,723
Total liabilities
$ 4,914,423
$ 4,369,664
$ 3,721,240
Total equity
$ 952,922
$ 872,037
$ 751,331
Total liabilities and equity
$ 5,867,345
$ 5,241,701
$ 4,472,571
Interest rate spread
8.21 %
8.00 %
4.29 %
Net interest income and net interest margin
$ 116,226
8.45 %
$ 99,680
8.26 %
$ 45,905
4.67 %
(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)
June 30, 2022
December 31, 2021
Assets
Cash and due from banks
$ 26,415
$ 35,670
Interest-bearing deposits in banks
1,015,565
651,456
Total cash and cash equivalents
1,041,980
687,126
Restricted cash
60,252
76,460
Securities available for sale at fair value ($435,451 and $256,170 at amortized cost, respectively)
402,994
263,530
Loans held for sale (includes $62,811 and $142,370 at fair value, respectively)
62,811
391,248
Loans and leases held for investment
4,054,721
2,899,126
Allowance for loan and lease losses
(243,260)
(144,389)
Loans and leases held for investment, net
3,811,461
2,754,737
Retail and certificate loans held for investment at fair value
122,078
229,719
Other loans held for investment at fair value
20,583
21,240
Property, equipment and software, net
119,976
97,996
Goodwill
75,717
75,717
Other assets
468,913
302,546
Total assets
$ 6,186,765
$ 4,900,319
Liabilities and Equity
Deposits:
Interest-bearing
$ 4,261,651
$ 2,919,203
Noninterest-bearing
266,021
216,585
Total deposits
4,527,672
3,135,788
Short-term borrowings
7,983
27,780
Advances from Paycheck Protection Program Liquidity Facility (PPPLF)
123,444
271,933
Retail notes, certificates and secured borrowings at fair value
122,078
229,719
Payable on Structured Program borrowings
15,274
65,451
Other long-term debt
15,300
15,455
Other liabilities
295,897
303,951
Total liabilities
5,107,648
4,050,077
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; 103,630,776 and 101,043,924 shares issued and outstanding, respectively
1,036
1,010
Additional paid-in capital
1,594,458
1,559,616
Accumulated deficit
(494,534)
(717,430)
Accumulated other comprehensive income (loss)
(21,843)
7,046
Total equity
1,079,117
850,242
Total liabilities and equity
$ 6,186,765
$ 4,900,319
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SOURCE LendingClub Corporation