LendingClub(US:LC)2025-10-30 20:16Financial Performance - Loan originations for Q3 2025 increased by $708.8 million, or 37%, year over year, driven by a rise in unsecured personal loan origination volume [170] - Total net revenue for Q3 2025 rose by $64.4 million, or 32%, year over year, with marketplace revenue increasing by $43.8 million, or 75% [170] - Net income for Q3 2025 increased by $29.8 million, or 206%, year over year, with diluted earnings per share growing to $0.37 from $0.13 in Q3 2024 [170] - Total loan originations for Q3 2025 were $2.622 billion, compared to $2.391 billion in Q3 2024 [174] - Net income for Q3 2025 was $44,274, representing a 16% increase from Q2 2025 and a 206% increase from Q3 2024 [180] - Total net revenue for the nine months ended September 30, 2025, was $747.5 million, a 27.1% increase from $588.0 million in the same period of 2024 [269] - Net income for the nine months ended September 30, 2025, was $94.1 million, compared to $41.6 million in 2024, representing a 126% increase [269] Assets and Liabilities - Total assets as of September 30, 2025, were $11.1 billion, comparable to $11.0 billion in the prior year, due to a portfolio acquisition [172] - Total liabilities as of September 30, 2025, were $9,610,302, compared to $9,369,298 in Q2 2025 [177] - Total equity increased to $1,462,213 as of September 30, 2025, from $1,406,035 in Q2 2025 [177] - Total liabilities increased to $9,240,903 as of September 30, 2025, compared to $9,095,865 in the previous quarter [212] - Total equity rose to $1,424,538, up from $1,381,199 in the previous quarter [212] - Total liabilities increased to $9,139,195 thousand in September 2025 from $8,304,569 thousand in September 2024, marking a growth of 10.1% [216] Income and Expenses - Total non-interest expense for Q3 2025 increased by $26.4 million, or 19%, year over year, mainly due to higher marketing expenses [170] - Total non-interest income for Q3 2025 reached $107,792, a 14% increase from Q2 2025 and a 75% increase from Q3 2024 [180] - Total non-interest expense for the third quarter of 2025 was $162,713, a 5% increase from $154,718 in the previous quarter and a 19% increase from $136,332 in the same quarter of 2024 [235] - Total non-interest income for the nine months ended September 30, 2025, was $284.9 million, a 45% increase from $196.3 million in 2024 [269] - Total non-interest expense for the nine months ended September 30, 2025, was $476.4 million, up from $419.0 million in 2024, indicating a 13.7% increase [269] Credit and Provisioning - Provision for credit losses decreased by $1.3 million, or 3%, year over year, reflecting improved credit performance [170] - Provision for credit losses for Q3 2025 was $46,280, a 16% increase from Q2 2025 [180] - The provision for credit losses for the first nine months of 2025 was $144,162 thousand, an increase of 25% from $115,029 thousand in 2024, primarily due to a higher volume of originated loans [223] - The allowance for loan and lease losses (ALLL) was estimated using a discounted cash flow approach, reflecting the expected credit losses on held-for-investment loans [220] - The allowance for loan and lease losses increased to $267,774 as of September 30, 2025, compared to $252,989 as of June 30, 2025, and $220,564 in the same period of 2024, resulting in an allowance ratio of 6.1% [228] Capital and Ratios - The common equity tier 1 capital ratio was 18.0% as of September 30, 2025, up from 17.5% in the previous quarter [174] - As of September 30, 2025, LendingClub Corporation's Common Equity Tier 1 (CET1) capital ratio was 18.0%, significantly above the minimum requirement of 7.0% [288] - LendingClub Bank's total capital ratio was 17.1% as of September 30, 2025, exceeding the minimum requirement of 10.5% [288] - Tangible Book Value (TBV) per common share increased to $11.95 as of September 30, 2025, compared to $11.19 in 2024 [278] - Return on Tangible Common Equity (ROTCE) for the nine months ended September 30, 2025, was 9.6%, compared to 4.7% in 2024 [279] Market and Loan Performance - Marketplace revenue for Q3 2025 was $102,155, reflecting a 14% increase from Q2 2025 and a 75% increase from Q3 2024 [184] - Marketplace loans originated reached $2,027,406 thousand in Q3 2025, a 19% increase from Q2 2025 and a 44% increase from Q3 2024 [187] - Marketplace revenue for the nine months ended September 30, 2025, reached $238.7 million, up 58% from $150.5 million in 2024 [269] Capital Expenditures and Investments - Capital expenditures for the third quarter of 2025 were $21.003 million, up from $12.436 million in the same period of 2024 [265] - Capital expenditures for the nine months ended September 30, 2025, totaled $124.8 million, significantly higher than $37.1 million in 2024 [269] - Capital expenditures in 2025 are projected to be approximately $155 million, driven by a $74.5 million acquisition of an office building and related improvements [295] Regulatory and Compliance - LendingClub Corporation is subject to ongoing supervision and regulation by multiple federal banking regulatory bodies, including the Federal Reserve and the Office of the Comptroller of the Currency [282] - The company has invested in regulatory compliance to meet the requirements set forth by banking regulations, which may impact its business operations [283] Interest Rate Sensitivity - Projected net interest income is expected to decrease by 7.7% and 7.1% under hypothetical increases of 200 basis points in interest rates for September 30, 2025, and December 31, 2024, respectively [305] - Conversely, net interest income is projected to increase by 3.3% and 1.1% under hypothetical decreases of 100 basis points in interest rates for September 30, 2025, and December 31, 2024, respectively [305] Miscellaneous - The company reported an increase in net interest income of $4,190 compared to the previous quarter, driven by changes in volume and yield [212] - The liquidity management strategy includes maintaining sufficient liquidity to meet daily cash flow requirements and unexpected funding needs [289] - The holding company had cash and cash equivalents of $140.9 million as of September 30, 2025, up from $66.0 million at the end of 2024, primarily due to a $50 million cash dividend from LC Bank [297]