Financial Performance - Marketplace revenue for the three months ended March 31, 2022, was $179,966 thousand, a significant increase of 120.0% compared to $81,727 thousand for the same period in 2021 [25]. - Total non-interest income reached $189,857 thousand for the first quarter of 2022, up from $87,334 thousand in the same quarter of 2021, marking an increase of 117.0% [25]. - Consolidated net income for the three months ended March 31, 2022, was $40,836 thousand, compared to a net loss of $47,084 thousand for the same period in 2021, indicating a turnaround in profitability [28]. - Basic earnings per share (EPS) for common stockholders was $0.40 for the first quarter of 2022, compared to a loss of $0.49 in the same quarter of 2021 [28]. - Total comprehensive income for the three months ended March 31, 2022, was $20,649 thousand, compared to a loss of $46,880 thousand in the same period of 2021 [31]. Assets and Liabilities - Total assets increased to $5,574,425 thousand as of March 31, 2022, up from $4,900,319 thousand at December 31, 2021, representing a growth of approximately 13.7% [18]. - Total liabilities rose to $4,686,991 thousand as of March 31, 2022, up from $4,050,077 thousand at December 31, 2021, representing an increase of approximately 15.7% [19]. - Total deposits increased to $3,977,477 thousand as of March 31, 2022, from $3,135,788 thousand at December 31, 2021, reflecting a growth of approximately 26.9% [19]. - Total cash, cash equivalents, and restricted cash at the end of the period was $1,113,732, compared to $970,880 at the end of the same period in 2021 [36]. - Total assets as of March 31, 2022, amounted to $92,031 million, a decrease from $162,323 million as of December 31, 2021 [109]. Credit Losses and Provisions - Provision for credit losses was $52,509 thousand for the first quarter of 2022, compared to $21,493 thousand in the same quarter of 2021, indicating an increase in expected credit losses [25]. - The company reported a credit loss expense of $52,228 thousand for loans and leases held for investment during the first quarter of 2022 [81]. - The allowance for loan and lease losses (ALLL) increased to $187,985 thousand, up from $144,389 thousand, indicating a rise of 30% [79]. Cash Flow - Net cash provided by operating activities was $40,673 for the three months ended March 31, 2022, compared to a cash used of $51,366 in the same period of 2021 [36]. - Net cash used for investing activities was $(360,224) for the three months ended March 31, 2022, compared to cash provided of $287,908 in the prior year [36]. - Net cash provided by financing activities was $669,697 for the three months ended March 31, 2022, compared to $105,853 in the same period of 2021 [36]. Securities and Investments - The fair value of U.S. agency residential mortgage-backed securities was $227,135 million as of March 31, 2022, compared to $123,699 million on December 31, 2021, indicating a significant increase [65]. - The company reported gross unrealized losses of $15,224 million for total securities available for sale as of March 31, 2022, compared to $3,744 million on December 31, 2021, representing a substantial increase in losses [66]. - The total fair value of municipal securities was $2,872 million as of March 31, 2022, down from $3,252 million as of December 31, 2021, indicating a decrease of approximately 11.66% [65]. Loans and Leases - Total loans and leases held for investment increased to $3,422,296 thousand as of March 31, 2022, up from $2,899,126 thousand as of December 31, 2021, representing a growth of 18% [78]. - Total consumer loans held for investment rose to $2,621,509 thousand, a 30% increase from $2,021,916 thousand in the previous period [79]. - The company reported a total of $218,801 in certificates of deposit as of March 31, 2022, significantly up from $68,405 as of December 31, 2021, marking a growth of about 220.5% [158]. Regulatory and Compliance - The Company is subject to regulatory examinations and actions, which may impact its business practices and compliance with licensing requirements [198]. - The Company is required to obtain a written determination of non-objection from the OCC before declaring any dividends, and no dividends were declared during the first quarters of 2022 and 2021 [212]. - The Company has resolved past legal matters without material impact on its financial operations, but future outcomes remain uncertain [200]. Stock-Based Compensation - Stock-based compensation for the three months ended March 31, 2022, was $15,694, compared to $14,801 in the same period of 2021 [36]. - The company granted 3,784,854 Restricted Stock Units (RSUs) with an aggregate fair value of $53.9 million during the first quarter of 2022 [172]. - As of March 31, 2022, there was $140.4 million of unrecognized compensation cost related to unvested RSUs, expected to be recognized over the next 2.2 years [173].

Financial Data and Key Metrics Changes - Revenues increased by 10% sequentially and more than doubled year-over-year to $290 million [17] - Net income rose to $41 million, up 40% sequentially and nearly $90 million year-over-year [17] - Net interest margin increased to 8.6% from 8.3% in the prior quarter and 3.3% a year earlier [19] Business Line Data and Key Metrics Changes - Marketplace revenue grew 6% to $180 million, while loan origination increased by 5% [18] - Recurring net interest income grew to $100 million, a 20% increase reflecting growth in the health and investment portfolio [18] - Personal loans now comprise 69% of the held-for-investment (HFI) portfolio, up from 62% at the end of 2021 [19] Market Data and Key Metrics Changes - Deposits grew 27% sequentially to $4 billion, primarily in high-yield savings accounts [20] - The company retained 27% of new consumer loan originations, which is 7 points above the previously shared range [19] Company Strategy and Development Direction - The company is focused on maintaining discipline in underwriting while expanding its product offerings to enhance member engagement [9][12] - Investments are being made in loan retention, marketing, and technology to support long-term growth [12][13] - The company plans to continue growing its commercial loans, excluding PPP, which are secured by collateral or cash flow [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating potential changes in the economic environment, citing strong earnings and capital levels [15] - The company raised guidance for revenue, earnings, and loan originations for the full year, reflecting positive momentum from Q1 [26][27] - Management acknowledged the need to be thoughtful about passing increased funding costs to borrowers while maintaining value for members [15] Other Important Information - The company introduced a new metric, pre-tax, pre-provision income, to better communicate underlying performance and growth [25] - The CET ratio remains strong at 16%, and tangible book value increased to $792 million at the end of Q1 [24] Q&A Session Summary Question: Loan demand and pricing outlook - Management noted strong loan demand driven by increasing credit card balances and familiarity with their offerings, with expectations of continued momentum into Q2 [30][32] - On loan pricing, management indicated a decrease in yields on unsecured loans as part of a strategy to focus on higher quality loans [33][35] Question: Marketing expenses and efficiency - Management confirmed that they still target marketing expenses in the range of 1.9% to 2% of volume, emphasizing efficiency and the impact of retaining a higher percentage of originations [38][40] Question: Nature of loan buyers in the marketplace - Management highlighted a diverse investor base, with a significant portion not reliant on capital markets, which provides stability and strong demand for loans [52][54] Question: Customer base health and trends - Management expressed confidence in the health of their customer base, noting strong performance and low delinquency rates, while proactively monitoring economic indicators [60][62]

Financial Performance - LendingClub's net revenue for Q1 2022 was $289.5 million, a 174% year-over-year increase and a 10% increase compared to the previous quarter[9, 10] - GAAP net income reached a record $40.8 million, up 40% quarter-over-quarter and $87.9 million year-over-year[9] - The average loan portfolio grew 65% year-over-year to $3.1 billion[15] - Net interest margin expanded to 8.61% due to the growing consumer loan portfolio mix[39] Loan Originations and Revenue Streams - Total loan originations in Q1 2022 amounted to $3.2 billion[16] - Net interest income increased, driven by average loan growth of 65% and a net interest margin of 8.6%[26] - Non-interest income, primarily from marketplace revenue, reflected year-over-year marketplace origination growth of $1.2 billion[26] Balance Sheet and Efficiency - Deposits totaled $4 billion, supporting the integrated originations and deposit model[16] - The average cost of funds was 0.42%[16] - The company's efficiency ratio improved, with non-interest expense as a percentage of net revenue decreasing[42] Outlook - LendingClub raised its full-year 2022 net revenue guidance to $1.15 billion to $1.25 billion, representing a 40% to 53% year-over-year increase[46] - The company also increased its full-year GAAP net income guidance to $145 million to $165 million, a 7.8X to 8.9X year-over-year increase[46] - The origination target was increased by $500 million to $13.5 billion for FY22[46]

Financial Performance - LendingClub's Q4 2021 originations reached $3.1 billion, exceeding the guidance target of $2.8B to $3.0B [10] - Q4 2021 revenue was $262.2 million, a 7% increase QoQ, driven by a 27% growth in net interest income [10] - GAAP Net Income for Q4 2021 was a record $29.1 million [10] - The company's FY22 revenue guidance is $1.1B to $1.2B, a 34% to 47% YoY increase [36] - FY22 GAAP Net Income guidance is $130M to $150M, a 600% to 707% YoY increase [36] Loan Portfolio and Net Interest Margin - The average consumer loan portfolio grew by 36% QoQ [16] - Net Interest Margin expanded to 8.25% [26] - Interest income from the Held For Investment (HFI) portfolio grew 34% QoQ [20] Loan Originations and Marketplace Revenue - Quarterly loan originations reached $3.107 billion in 4Q21 [17] - Quarterly marketplace revenue was $170.6 million in 4Q21 [17] Customer Profile and Credit Performance - LendingClub's members generally have high income (+$100K avg) and high FICO (+700 avg) [5] - The average FICO score for 2021 HFI loans is 717 [33] - The average income for 2021 HFI loans is $114,000 [33]

Financial Data and Key Metrics Changes - The company reported Q4 2021 revenues of $262 million, a 7% sequential increase, exceeding the guidance range of $240 million to $250 million [16] - Net income for the quarter was $29.1 million, surpassing the target range of $20 million to $25 million [16] - The recurring net interest income increased by 27% for the quarter, now representing 32% of quarterly revenue [16][18] - The net interest margin at the bank rose to 8.25%, up 119 basis points sequentially [16] Business Line Data and Key Metrics Changes - Total loan originations for Q4 were $3.1 billion, exceeding the guidance range of $2.8 billion to $3 billion [16] - Marketplace revenues decreased by 2% from Q3, reflecting fewer loans sold and a higher held-for-investment (HFI) portfolio retention of 25% compared to 20% in Q3 [17] - The consumer loan portfolio grew to over $2 billion, an 18% sequential increase [20] Market Data and Key Metrics Changes - The company expects consumer demand to build as credit card balances recover towards pre-pandemic levels, increasing the total addressable market [8] - The company anticipates that rising interest rates will not negatively impact demand for refinancing credit card debt [10] Company Strategy and Development Direction - The company aims for 40% revenue growth at the midpoint and an additional $120 million in earnings for 2022 [7] - Investments in 2022 will focus on building the on-balance sheet loan portfolio, enhancing marketing and product experience, and improving infrastructure [12][13] - The company plans to retain 15% to 25% of personal loan originations to drive sustained recurring revenue [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating environmental factors such as competitive activity and rising interest rates [7] - The company expects to deliver strong results in 2022, leveraging competitive advantages and operating momentum [11] - Management noted that the charge-off rate for the quarter was about 190 basis points, with expectations for it to rise as the portfolio matures [60] Other Important Information - The company integrated its purchase finance operation onto a common platform to leverage data and servicing capabilities [12] - The Tier 1 leverage ratio at the bank was 14.3%, above the targeted level of 11% [22] Q&A Session Summary Question: Origination guidance for 2022 - Management indicated that the $13 billion origination target for 2022 is conservative, considering seasonal trends and market conditions [29][30] Question: Mix of originations and auto refinancing - Management noted that while auto refinancing numbers are small, they expect disproportionate growth in that area [31][32] Question: Provisioning rate for retained loans - Management suggested a provisioning rate of around 6% to 7% for retained originations, which may increase as the portfolio matures [36][38] Question: Marketing expenses as a percentage of originations - Management expects marketing expenses to return to pre-pandemic levels, around 2% of originations [40][50] Question: Investments in technology and marketing - Management outlined plans for approximately $25 million in technology investments and $25 million in marketing to enhance customer acquisition and retention [45][46] Question: Charge-off rate and future expectations - Management indicated that the charge-off rate is expected to rise as the portfolio matures, with a projected range of 4% to 4.5% [60] Question: Auto loans and scaling - Management confirmed a combination of marketplace and balance sheet strategies for auto loans, with expectations for the business to cover its costs [76]

LendingClub Corporation (NYSE:LC) Q3 2021 Earnings Conference Call October 27, 2021 5:00 PM ET Company Participants Sameer Gokhale - Head, IR Scott Sanborn - Chief Executive Officer Thomas Casey - Chief Financial Officer Conference Call Participants Henry Coffey - Wedbush Securities Giuliano Bologna - Compass Point Steven Kwok - KBW John Rowan - Janney Montgomery Scott Operator Good afternoon, and welcome to the LendingClub’s Third Quarter 2021 Earnings Conference Call. All participants will be in listen- ...