LendingClub Shares Plummet as Loan Originations Slow

Core Insights - LendingClub reported growth in key metrics such as loan originations and deposits, but faced a deceleration in growth rates in the final quarter of the year, leading to a 23% drop in shares after hours [1][2]. Financial Performance - Consumer loan originations in Q4 reached $1.8 billion, a 13$217.2 million, while deposits rose by 24% year-on-year to $9.1 billion [2]. Guidance and Projections - The company projects Q1 loan originations between$1.8 billion and $1.9 billion, indicating a growth of 12.5$60 million to $70 million, slightly below the consensus estimate of$73 million [9]. Credit Metrics - The net charge-off ratio for the held-for-investment portfolio improved to 4.5%, down from 6.6% the previous year [4]. - CEO Scott Sanborn highlighted that delinquencies were over 40% better than competitors, attributing this to the company's data advantage and disciplined risk management [5]. Product and Technology Developments - The "top up" offering has seen an 80% increase in issuance dollars per member compared to traditional personal loans [6]. - The DebtIQ tool has led to a 50% increase in member engagement and a 25% boost in loan issuance for enrolled members [7]. Marketing and Growth Strategy - CFO Drew LaBenne indicated that marketing expenses will rise, with expectations of continued loan volume growth as the company enters the seasonally favorable second and third quarters [8]. - The LevelUp savings product has generated $1.2 billion in deposits since its launch in August 2024, with over 70% of customers actively adding to their savings [10].