LendingClub Reports Fourth Quarter and Full Year 2022 Results

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January 25, 2023 4:06 PM EST

Delivers Record Full Year Revenue and Earnings Growth Despite Challenging Environment

SAN FRANCISCO, Jan. 25, 2023 /PRNewswire/ -- LendingClub Corporation (NYSE: LC), the parent company of LendingClub Bank, America's leading digital marketplace bank, today announced financial results for the fourth quarter and full year ended December 31, 2022.

LC) is the parent company of LendingClub Bank, National Association, Member FDIC. LendingClub Bank is the leading digital marketplace bank in the U.S." alt="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." />

"Our fourth quarter results clearly demonstrated the benefits of our evolution into a marketplace bank. We significantly grew recurring revenue to offset the expected reduction in marketplace volumes," said Scott Sanborn, LendingClub CEO. "Looking ahead, in anticipation of a more challenging environment, we have streamlined our operations and will maintain our underwriting discipline. We also intend to remain profitable, while investing in-period earnings into loan retention to support future earnings. These actions will allow us to capitalize on growth opportunities as economic pressures abate."

Full Year 2022 Results Reflect Ongoing Transformation and Positioning for Long-Term Sustained Success

  • Total assets increased 63% year over year to $8.0 billion, primarily reflecting growth in loans held for investment, including the acquisition of a $1.05 billion outstanding principal loan portfolio in the fourth quarter of 2022.
  • Deposits of $6.4 billion more than doubled, primarily due to growth in online savings deposits.
  • Total net revenue of $1.2 billion up 45% year over year
    • Net interest income, a recurring stream of earnings, increased over 100% to $474.8 million.
    • Marketplace revenue grew 18% year over year to $683.6 million.
  • Pre-tax income of $153.0 million compared to $18.4 million in the prior year, reflecting solid revenue growth combined with improved operating efficiency.
  • Implemented significant cost reduction plan to more closely align the company's expense base with anticipated loan volume in 2023.

Fourth Quarter 2022 Results

  • Total net revenue of $262.7 million was comparable to the prior-year period, as strong growth in net interest income offset lower marketplace revenue.
    • Net interest income increased 63% year over year to $135.2 million.
      • Total loans and leases held for investment grew 104%, primarily reflecting growth in personal loan originations held for investment and the acquisition of a $1.05 billion loan portfolio in the fourth quarter of 2022.
      • Net interest margin expanded to 7.8% from 7.6% in the prior-year period, primarily reflecting a greater mix of personal loans which generate a higher yield than the other loans held for investment.
    • Marketplace revenue was $123.4 million compared to $170.6 million year over year, reflecting a reduction in volumes consistent with the change in total origination volume due to the pace of Federal Reserve interest rate increases and tighter underwriting standards implemented by the company.
  • Loan originations were $2.5 billion, compared to $3.1 billion in the prior-year period.
  • Credit quality of the held-for-investment prime loan portfolio remained strong, with delinquency rates continuing to normalize as the portfolio seasons.
  • Provision for credit losses of $61.5 million primarily reflects $700.8 million of quarterly loan originations held for investment and ongoing recognition of provision expense for discounted lifetime losses at origination.
  • Efficiency ratio improved to 69% from 72% in the prior-year period due to better marketing efficiency.
  • Pre-provision net revenue of $82.7 million grew 12% year over year, driven by improved operating efficiency.
  • Net income of $23.6 million compared to $29.1 million year over year, reflecting higher credit provisioning due to growth in the held-for-investment portfolio, partially offset by favorable marketing efficiency.
  • Total equity of $1.2 billion grew $314.1 million from December 31, 2021, primarily reflecting net income generated over the period and the release of the deferred tax asset valuation allowance.
  • Book value per common share of $10.93 increased 30% from December 31, 2021. Tangible book value per common share of $10.06 increased 35% from December 31, 2021. The increases in book value and tangible book value per share were consistent with the growth in total equity.
  • Substantial capital with a consolidated Tier 1 leverage ratio of 14.1% and consolidated Common Equity Tier 1 capital ratio of 15.8%.

 

Three Months Ended

Year Ended

($ in millions, except per share amounts)

December 31,2022

September 30,2022

December 31,2021

December 31,2022

December 31,2021

Total net revenue

$            262.7

$             304.9

$            262.2

$         1,187.2

$            818.6

Non-interest expense

180.0

186.2

188.2

766.9

661.4

Pre-provision net revenue (1)

82.7

118.7

74.0

420.3

157.2

Provision for credit losses

61.5

82.7

45.1

267.3

138.8

Income before income tax benefit

21.2

36.0

28.9

153.0

18.4

Income tax benefit

2.4

7.2

0.2

136.6

0.1

Net income

$             23.6

$              43.2

$              29.1

$           289.7

$             18.6

Diluted EPS

$             0.22

$              0.41

$              0.27

$             2.79

$             0.18

Income tax benefit from release of tax valuation allowance

$               3.2

$                5.0

$                 —

$           143.5

$                —

Net income excluding income tax benefit (1,2)

$             20.4

$              38.2

$              29.1

$           146.2

$             18.6

Diluted EPS excluding income tax benefit (1,2)

$             0.19

$              0.36

$              0.27

$             1.41

$             0.18

(1)

See page 3 of this release for additional information on our use of non-GAAP financial measures.

(2)

Fourth and third quarters of 2022 and the year ended December 31, 2022, include income tax benefit of $3.2 million, $5.0 million, and $143.5 million, respectively, due to the release of a deferred tax asset valuation allowance.

 

For a calculation of Pre-Provision Net Revenue, Net Income Excluding Income Tax Benefit, Diluted EPS Excluding Income Tax Benefit, and Tangible Book Value Per Common Share, refer to the "Reconciliation of GAAP to Non-GAAP Financial Measures" tables at the end of this release.

Financial Outlook

Given the rapid change in the economic environment, the company is currently providing guidance for the first quarter of 2023 and expects loan originations and pre-provision net revenue to be in the ranges below. The outlook for loan originations reflects the impact of rising rates on marketplace demand combined with continued prudent underwriting. The company plans to maintain held-for-investment loan balances in line with the fourth quarter of 2022. For 2023, the company intends to remain profitable, while investing in-period earnings into loan retention to support future earnings.

First Quarter 2023

Loan Originations

$1.9B to $2.2B

Pre-Provision Net Revenue

$55M to $70M

 

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 $80 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 4.5 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 fourth 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, January 25, 2023. 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 786729, 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 February 1, 2023, by calling +1 (866) 813-9403 or outside the U.S. +44 (204) 525-0658, with Access Code 636433. 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.

ContactsFor Investors:[email protected]

Media Contact:[email protected]

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: Pre-Provision Net Revenue, Net Income Excluding Income Tax Benefit, Diluted EPS Excluding Income Tax Benefit, and Tangible Book Value Per Common Share. Our non-GAAP financial 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 financial 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 Pre-Provision Net Revenue, Net Income Excluding Income Tax Benefit and Diluted EPS Excluding Income Tax Benefit are important measures because they reflect the financial performance of our business operations. Pre-Provision Net Revenue is a non-GAAP financial measure calculated by subtracting the provision for credit losses and income tax benefit/expense from net income. Net Income Excluding Income Tax Benefit adjusts for the release of a deferred tax asset valuation allowance in the fourth, third and second quarters 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.

We believe Tangible Book Value (TBV) Per Common Share is an important measure used to evaluate the company's use of equity. TBV Per Common Share is a non-GAAP financial measure representing common equity reduced by goodwill and intangible assets, divided by ending common shares issued and outstanding.

For a reconciliation of such measures to the nearest GAAP measures, please refer to the tables beginning on page 14 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; our ability to realize the expected benefits from recent initiatives, including our cost reduction plan and the acquisition of a $1 billion loan portfolio; competition; overall economic conditions; the interest rate environment; 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 and Quarterly Report on Form 10-Q, each 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)

As of and for the three months ended

% Change

December 31,2022

September 30,2022

June 30,

2022

March 31,

2022

December 31,2021

Q/Q

Y/Y

Operating Highlights:

Non-interest income

$       127,465

$      181,237

$    213,832

$    189,857

$       179,111

(30) %

(29) %

Net interest income

135,243

123,676

116,226

99,680

83,132

9 %

63 %

Total net revenue

262,708

304,913

330,058

289,537

262,243

(14) %

— %

Non-interest expense

180,044

186,219

209,386

191,204

188,220

(3) %

(4) %

Pre-provision net revenue(1)

82,664

118,694

120,672

98,333

74,023

(30) %

12 %

Provision for credit losses

61,512

82,739

70,566

52,509

45,149

(26) %

36 %

Income before income tax benefit (expense)

21,152

35,955

50,106

45,824

28,874

(41) %

(27) %

Income tax benefit (expense)

2,439

7,243

131,954

(4,988)

234

N/M

NM

Net income

23,591

43,198

182,060

40,836

29,108

N/M

N/M

Income tax benefit from release of tax valuation allowance

3,180

5,015

135,300

—

—

N/M

N/M

Net income excluding income tax benefit(1)(2)

$        20,411

$        38,183

$     46,760

$     40,836

$        29,108

(47) %

(30) %

Basic EPS – common stockholders

$            0.22

$            0.41

$         1.77

$         0.40

$            0.29

(46) %

(24) %

Diluted EPS – common stockholders

$            0.22

$            0.41

$         1.73

$         0.39

$            0.27

(46) %

(19) %

Diluted EPS excluding income tax benefit(1)(2)

$            0.19

$            0.36

$         0.45

$         0.39

$            0.27

(47) %

(30) %

LendingClub Corporation Performance Metrics:

Net interest margin

7.8 %

8.3 %

8.5 %

8.3 %

7.6 %

Efficiency ratio(3)

68.5 %

61.1 %

63.4 %

66.0 %

71.8 %

Return on average equity (ROE)

7.2 %

14.2 %

33.8 %

18.7 %

14.1 %

Return on average total assets (ROA)

1.1 %

2.5 %

5.5 %

3.1 %

2.4 %

Marketing expense as a % of loan originations

1.4 %

1.3 %

1.6 %

1.7 %

1.7 %

LendingClub Corporation Capital Metrics:

Common Equity Tier 1 Capital Ratio

15.8 %

18.3 %

20.0 %

20.6 %

21.3 %

Tier 1 Leverage Ratio

14.1 %

15.7 %

16.2 %

15.6 %

16.5 %

Book Value per Common Share

$           10.93

$           10.67

$        10.41

$          8.68

$            8.41

2 %

30 %

Tangible Book Value per Common Share(1)

$           10.06

$             9.78

$          9.50

$          7.75

$            7.46

3 %

35 %

Loan Originations (in millions)(4):

Total loan originations

$           2,524

$           3,539

$        3,840

$        3,217

$          3,069

(29) %

(18) %

Marketplace loans

$           1,824

$           2,386

$        2,819

$        2,360

$          2,308

(24) %

(21) %

Loan originations held for investment

$              701

$           1,153

$        1,021

$           856

$             761

(39) %

(8) %

Loan originations held for investment as a % of total loan originations

28 %

33 %

27 %

27 %

25 %

Servicing Portfolio AUM (in millions)(5):

Total servicing portfolio

$        16,157

$         15,929

$      14,783

$      13,341

$        12,463

1 %

30 %

Loans serviced for others

$        10,819

$         11,807

$      11,382

$      10,475

$        10,124

(8) %

7 %

Balance Sheet Data:

Loans and leases held for investment at amortized cost, net, excluding PPP loans

$   4,638,331

$   4,414,347

$  3,692,667

$  3,049,325

$   2,486,440

5 %

87 %

PPP loans

$        66,971

$        89,379

$   118,794

$   184,986

$      268,297

(25) %

(75) %

Total loans and leases held for investment at amortized cost, net(6)

$   4,705,302

$   4,503,726

$  3,811,461

$  3,234,311

$   2,754,737

4 %

71 %

Loans held for investment at fair value

$      925,938

$        15,057

$     20,583

$     15,384

$               21

N/M

N/M

Total loans and leases held for investment

$   5,631,240

$   4,518,783

$  3,832,044

$  3,249,695

$   2,754,758

25 %

104 %

Total assets

$   7,979,747

$   6,775,074

$  6,186,765

$  5,574,425

$   4,900,319

18 %

63 %

Total deposits

$   6,392,553

$   5,123,506

$  4,527,672

$  3,977,477

$   3,135,788

25 %

104 %

Total liabilities

$   6,815,453

$   5,653,664

$  5,107,648

$  4,686,991

$   4,050,077

21 %

68 %

Total equity

$   1,164,294

$   1,121,410

$  1,079,117

$   887,434

$      850,242

4 %

37 %

N/M – Not meaningful

(1)

Represents a non-GAAP financial measure. See "Reconciliation of GAAP to Non-GAAP Financial Measures."

(2)

Excludes fourth, third and second quarter 2022 income tax benefit of $3.2 million, $5.0 million and $135.3 million, respectively, due to the release of a deferred tax asset valuation allowance.

(3)

Calculated as the ratio of non-interest expense to total net revenue.

(4)

Includes unsecured personal loans, auto loans, and education and patient finance loans only.

(5)

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.

(6)

Excludes loans held for investment at fair value, which primarily consists of a loan portfolio that was acquired in the fourth quarter of 2022.

 

The asset quality metrics presented in the following table are for loans and leases held for investment at amortized cost and do not reflect loans held for investment at fair value:

As of and for the three months ended

December 31,2022

September 30,2022

June 30,

2022

March 31,

2022

December 31,2021

Asset Quality Metrics:

Allowance for loan and lease losses to total loans and leases held for investment

6.5 %

6.3 %

6.0 %

5.5 %

5.0 %

Allowance for loan and lease losses to total loans and leases held for investment, excluding PPP loans

6.6 %

6.4 %

6.2 %

5.8 %

5.5 %

Allowance for loan and lease losses to consumer loans and leases held for investment

7.3 %

7.2 %

6.9 %

6.6 %

6.4 %

Allowance for loan and lease losses to commercial loans and leases held for investment

2.0 %

1.9 %

2.0 %

1.8 %

1.8 %

Allowance for loan and lease losses to commercial loans and leases held for investment, excluding PPP loans

2.2 %

2.2 %

2.3 %

2.6 %

2.6 %

Net charge-offs

$          37,148

$          22,658

$          13,987

$            8,673

$            5,636

Net charge-off ratio(1)

3.0 %

2.1 %

1.6 %

1.2 %

0.9 %

(1)

Net charge-off ratio is calculated as annualized net charge-offs divided by average outstanding loans and leases held for investment during the period, excluding PPP loans.

 

LENDINGCLUB CORPORATION

LOANS AND LEASES HELD FOR INVESTMENT

(In thousands)

(Unaudited)

The following table presents loans and leases held for investment at amortized cost and loans held for investment at fair value:

December 31,2022

September 30,2022

December 31,2021

Unsecured personal

$       3,866,373

$       3,642,254

$       1,804,578

Residential mortgages

199,601

197,776

151,362

Secured consumer

194,634

180,768

65,976

Total consumer loans held for investment

4,260,608

4,020,798

2,021,916

Equipment finance (1)

160,319

167,447

149,155

Commercial real estate

373,501

372,406

310,399

Commercial and industrial (2)

238,726

246,276

417,656

Total commercial loans and leases held for investment

772,546

786,129

877,210

Total loans and leases held for investment at amortized cost

5,033,154

4,806,927

2,899,126

Allowance for loan and lease losses

(327,852)

(303,201)

(144,389)

Loans and leases held for investment at amortized cost, net

$       4,705,302

$       4,503,726

$       2,754,737

Loans held for investment at fair value

$          925,938

$            15,057

$                   21

Total loans and leases held for investment

$       5,631,240

$       4,518,783

$       2,754,758

(1)

Comprised of sales-type leases for equipment.

(2)

Includes $67.0 million, $89.4 million, and $268.3 million of Paycheck Protection Program (PPP) loans as of December 31, 2022, September 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)

(Unaudited)

The following tables present the allowance for loan and lease losses on loans and leases held for investment at amortized cost and do not reflect loans held for investment at fair value:

Three Months Ended

December 31, 2022

September 30, 2022

Consumer

Commercial

Total

Consumer

Commercial

Total

Allowance for loan and lease losses, beginning of period

$     288,138

$          15,063

$ 303,201

$     228,184

$          15,076

$ 243,260

Credit loss expense for loans and leases held for investment

61,392

407

61,799

81,935

664

82,599

Charge-offs

(38,579)

(225)

(38,804)

(22,944)

(784)

(23,728)

Recoveries

1,538

118

1,656

963

107

1,070

Allowance for loan and lease losses, end of period

$     312,489

$          15,363

$ 327,852

$     288,138

$          15,063

$ 303,201

 

Three Months Ended

December 31, 2021

Consumer

Commercial

Total

Allowance for loan and lease losses, beginning of period

$        88,631

$          16,105

$ 104,736

Credit loss expense for loans and leases held for investment

45,595

(306)

45,289

Charge-offs

(5,557)

(313)

(5,870)

Recoveries

143

91

234

Allowance for loan and lease losses, end of period

$     128,812

$          15,577

$ 144,389

 

LENDINGCLUB CORPORATION

PAST DUE LOANS AND LEASES HELD FOR INVESTMENT

(In thousands)

(Unaudited)

 

The following tables present past due loans and leases held for investment at amortized cost and do not reflect loans held for investment at fair value:

December 31, 2022

30-59Days

60-89Days

90 or MoreDays

Total DaysPast Due

Unsecured personal

$       21,016

$       16,418

$       16,255

$             53,689

Residential mortgages

—

254

331

585

Secured consumer

1,720

382

188

2,290

Total consumer loans held for investment

$       22,736

$       17,054

$       16,774

$             56,564

Equipment finance

$         3,172

$              —

$            859

$               4,031

Commercial real estate

—

102

—

102

Commercial and industrial (1)

—

—

1,643

1,643

Total commercial loans and leases held for investment (1)

$         3,172

$            102

$         2,502

$               5,776

Total loans and leases held for investment at amortized cost (1)

$       25,908

$       17,156

$       19,276

$             62,340

September 30, 2022

30-59Days

60-89Days

90 or MoreDays

Total DaysPast Due

Unsecured personal

$       14,799

$       12,463

$       10,601

$             37,863

Residential mortgages

—

—

337

337

Secured consumer

985

504

162

1,651

Total consumer loans held for investment

$       15,784

$       12,967

$       11,100

$             39,851

Equipment finance

$              —

$              —

$              —

$                     —

Commercial real estate

—

101

452

553

Commercial and industrial (1)

—

—

1,650

1,650

Total commercial loans and leases held for investment (1)

$              —

$            101

$         2,102

$               2,203

Total loans and leases held for investment at amortized cost (1)

$       15,784

$       13,068

$       13,202

$             42,054

December 31, 2021

30-59Days

60-89Days

90 or MoreDays

Total DaysPast Due

Unsecured personal

$         3,624

$         2,600

$         1,676

$               7,900

Residential mortgages

142

92

1,069

1,303

Secured consumer

171

53

3,011

3,235

Total consumer loans held for investment

$         3,937

$         2,745

$         5,756

$             12,438

Equipment finance

$              —

$              —

$              —

$                     —

Commercial real estate

104

—

609

713

Commercial and industrial (1)

—

—

1,410

1,410

Total commercial loans and leases held for investment (1)

$            104

$              —

$         2,019

$               2,123

Total loans and leases held for investment at amortized cost (1)

$         4,041

$         2,745

$         7,775

$             14,561

(1)

Past due PPP loans are excluded from the tables.

 

LENDINGCLUB CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except share and per share data)

(Unaudited)

Three Months Ended

Change (%)

December 31,2022

September 30,2022

December 31,2021

Q4 2022

vs

Q4 2021

Q4 2022

vs

Q3 2022

Non-interest income:

Origination fees

$       100,692

$        127,142

$       118,353

(15) %

(21) %

Servicing fees

20,169

23,760

20,940

(4) %

(15) %

Gain on sales of loans

18,352

23,554

20,569

(11) %

(22) %

Net fair value adjustments

(15,774)

(619)

10,700

(247) %

N/M

Marketplace revenue

123,439

173,837

170,562

(28) %

(29) %

Other non-interest income

4,026

7,400

8,549

(53) %

(46) %

Total non-interest income

127,465

181,237

179,111

(29) %

(30) %

Total interest income

173,999

143,220

97,655

78 %

21 %

Total interest expense

38,756

19,544

14,523

167 %

98 %

Net interest income

135,243

123,676

83,132

63 %

9 %

Total net revenue

262,708

304,913

262,243

— %

(14) %

Provision for credit losses

61,512

82,739

45,149

36 %

(26) %

Non-interest expense:

Compensation and benefits

87,768

84,916

78,741

11 %

3 %

Marketing

35,139

46,031

50,708

(31) %

(24) %

Equipment and software

13,200

12,491

12,019

10 %

6 %

Occupancy

4,698

5,051

4,706

— %

(7) %

Depreciation and amortization

11,554

10,681

10,462

10 %

8 %

Professional services

10,029

11,943

12,699

(21) %

(16) %

Other non-interest expense

17,656

15,106

18,885

(7) %

17 %

Total non-interest expense

180,044

186,219

188,220

(4) %

(3) %

Income before income tax benefit

21,152

35,955

28,874

(27) %

(41) %

Income tax benefit

2,439

7,243

234

N/M

N/M

Net income

$         23,591

$          43,198

$         29,108

(19) %

(45) %

Net income per share: 

Net income per share attributable to common stockholders – Basic

$             0.22

$              0.41

$             0.29

(24) %

(46) %

Net income per share attributable to common stockholders – Diluted

$             0.22

$              0.41

$             0.27

(19) %

(46) %

Weighted-average common shares – Basic

105,650,177

104,215,594

100,320,691

5 %

1 %

Weighted-average common shares – Diluted

105,984,612

105,853,938

108,096,823

(2) %

— %

N/M – Not meaningful

 

LENDINGCLUB CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except share and per share data)

(Unaudited)

Year Ended December 31,

2022

2021

Change (%)

Non-interest income:

Origination fees

$       499,179

$       416,839

20 %

Servicing fees

80,609

87,639

(8) %

Gain on sales of loans

95,335

70,116

36 %

Net fair value adjustments

8,503

3,986

113 %

Marketplace revenue

683,626

578,580

18 %

Other non-interest income

28,765

27,219

6 %

Total non-interest income

712,391

605,799

18 %

Total interest income

557,340

292,832

90 %

Total interest expense

82,515

80,001

3 %

Net interest income

474,825

212,831

123 %

Total net revenue

1,187,216

818,630

45 %

Provision for credit losses

267,326

138,800

93 %

Non-interest expense:

Compensation and benefits

339,397

288,390

18 %

Marketing

197,747

156,142

27 %

Equipment and software

49,198

39,490

25 %

Occupancy

21,977

24,249

(9) %

Depreciation and amortization

43,831

44,285

(1) %

Professional services

50,516

47,572

6 %

Other non-interest expense

64,187

61,258

5 %

Total non-interest expense

766,853

661,386

16 %

Income before income tax benefit

153,037

18,444

730 %

Income tax benefit

136,648

136

N/M

Net income

$       289,685

$         18,580

N/M

Net income per share: 

Net income per share attributable to common stockholders – Basic

$             2.80

$             0.19

N/M

Net income per share attributable to common stockholders – Diluted

$             2.79

$             0.18

N/M

Weighted-average common shares – Basic

103,547,305

97,486,754

6 %

Weighted-average common shares – Diluted

104,001,288

102,147,353

2 %

N/M – Not meaningful

 

LENDINGCLUB CORPORATION

NET INTEREST INCOME

(In thousands, except percentages or as noted)

(Unaudited)

Consolidated LendingClub Corporation (1)

Three Months Ended

December 31, 2022

Three Months Ended

September 30, 2022

Three Months Ended

December 31, 2021

AverageBalance

Interest Income/Expense

Average Yield/Rate

AverageBalance

Interest Income/Expense

Average Yield/Rate

AverageBalance

Interest Income/Expense

Average Yield/Rate

Interest-earning assets (2)

Cash, cash equivalents, restricted cash and other

$ 1,139,887

$   10,595

3.72 %

$    893,655

$      5,017

2.25 %

$    710,472

$       469

0.26 %

Securities available for sale at fair value

349,512

3,359

3.84 %

396,556

3,820

3.85 %

265,140

3,071

4.63 %

Loans held for sale

114,851

5,724

19.93 %

126,487

5,879

18.59 %

184,708

7,153

15.49 %

Loans and leases held for investment:

Unsecured personal loans

3,825,808

125,872

13.16 %

3,268,649

110,446

13.52 %

1,542,285

60,384

15.66 %

Commercial and other consumer loans

1,164,326

15,197

5.22 %

1,135,474

13,582

4.78 %

1,381,041

16,580

4.80 %

Loans and leases held for investment at amortized cost

4,990,134

141,069

11.31 %

4,404,123

124,028

11.26 %

2,923,326

76,964

10.53 %

Loans held for investment at fair value (3)

308,570

10,862

14.08 %

17,763

791

17.83 %

24,184

762

12.60 %

Total loans and leases held for investment

5,298,704

151,931

11.47 %

4,421,886

124,819

11.29 %

2,947,510

77,726

10.55 %

Retail and certificate loans held for investment at fair value

66,469

2,390

14.38 %

104,010

3,685

14.17 %

262,548

9,236

14.07 %

Total interest-earning assets

6,969,423

173,999

9.99 %

5,942,594

143,220

9.64 %

4,370,378

97,655

8.94 %

Cash and due from banks and restricted cash

64,907

58,411

73,258

Allowance for loan and lease losses

(314,861)

(254,849)

(125,120)

Other non-interest earning assets

613,664

597,169

465,010

Total assets

$ 7,333,133

$ 6,343,325

$ 4,783,526

Interest-bearing liabilities

Interest-bearing deposits:

Checking and money market accounts

$ 1,929,260

$     7,500

1.54 %

$ 2,192,904

$      4,575

0.83 %

$ 2,146,687

$    1,716

0.32 %

Savings accounts and certificates of deposit

3,576,205

28,251

3.13 %

2,260,170

10,609

1.86 %

580,361

900

0.62 %

Interest-bearing deposits

5,505,465

35,751

2.58 %

4,453,074

15,184

1.35 %

2,727,048

2,616

0.38 %

Short-term borrowings

3,875

63

6.52 %

6,848

87

5.09 %

36,823

561

6.08 %

Advances from PPPLF

77,199

69

0.36 %

104,897

93

0.36 %

342,335

307

0.36 %

Retail notes, certificates and secured borrowings

66,469

2,390

14.38 %

104,010

3,685

14.17 %

262,548

9,236

14.07 %

Structured Program borrowings

9,956

159

6.39 %

13,859

225

6.50 %

77,354

1,642

8.49 %

Other long-term debt

14,804

324

8.76 %

15,300

270

7.04 %

15,514

161

4.15 %

Total interest-bearing liabilities

5,677,768

38,756

2.71 %

4,697,988

19,544

1.65 %

3,461,622

14,523

1.68 %

Non-interest bearing deposits

251,686

284,134

211,692

Other liabilities

266,558

250,086

282,339

Total liabilities

$ 6,196,012

$ 5,232,208

$ 3,955,653

Total equity

$ 1,137,121

$  1,111,117

$    827,873

Total liabilities and equity

$ 7,333,133

$ 6,343,325

$ 4,783,526

Interest rate spread

7.28 %

7.99 %

7.26 %

Net interest income and net interest margin

$  135,243

7.76 %

$ 123,676

8.32 %

$  83,132

7.61 %

(1)

Consolidated presentation reflects intercompany eliminations.

(2)

Nonaccrual loans and any related income are included in their respective loan categories.

(3)

Fourth quarter 2022 average balance includes the acquisition of a $1.05 billion outstanding principal loan portfolio in December 2022.

 

LENDINGCLUB CORPORATION

CONSOLIDATED BALANCE SHEETS

(In Thousands, Except Share and Per Share Amounts)

(Unaudited)

December 31,2022

December 31,2021

Assets

Cash and due from banks

$            23,125

$          35,670

Interest-bearing deposits in banks

1,033,905

651,456

Total cash and cash equivalents

1,057,030

687,126

Restricted cash

67,454

76,460

Securities available for sale at fair value ($399,668 and $256,170 at amortized cost, respectively)

345,702

263,530

Loans held for sale (includes $110,400 and $142,370 at fair value, respectively)

110,400

391,248

Loans and leases held for investment

5,033,154

2,899,126

Allowance for loan and lease losses

(327,852)

(144,389)

Loans and leases held for investment, net

4,705,302

2,754,737

Loans held for investment at fair value

925,938

21,240

Retail and certificate loans held for investment at fair value

55,425

229,719

Property, equipment and software, net

136,473

97,996

Goodwill

75,717

75,717

Other assets

500,306

302,546

Total assets

$        7,979,747

$     4,900,319

Liabilities and Equity

Deposits:

Interest-bearing

$        6,158,560

$     2,919,203

Noninterest-bearing

233,993

216,585

Total deposits

6,392,553

3,135,788

Short-term borrowings

2,619

27,780

Advances from Paycheck Protection Program Liquidity Facility (PPPLF)

64,154

271,933

Retail notes, certificates and secured borrowings at fair value

55,425

229,719

Payable on Structured Program borrowings

8,085

65,451

Other long-term debt

—

15,455

Other liabilities

292,617

303,951

Total liabilities

6,815,453

4,050,077

Equity

Series A Preferred stock, $0.01 par value; 1,200,000 shares authorized; — shares issued and outstanding

—

—

Common stock, $0.01 par value; 180,000,000 shares authorized; 106,546,995 and 101,043,924 shares issued and outstanding, respectively

1,065

1,010

Additional paid-in capital

1,628,590

1,559,616

Accumulated deficit

(427,745)

(717,430)

Accumulated other comprehensive income (loss)

(37,616)

7,046

Total equity

1,164,294

850,242

Total liabilities and equity

$        7,979,747

$     4,900,319

 

LENDINGCLUB CORPORATION

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES

(In thousands, except share and per share data)

(Unaudited)

Pre-Provision Net Revenue

For the three months ended

For the year ended

December 31,

2022

September 30,2022

June 30,2022

March 31,

2022

December 31,2021

December 31,

2022

December 31,

2021

GAAP Net income

$          23,591

$            43,198

$     182,060

$       40,836

$          29,108

$        289,685

$          18,580

Less: Provision for credit losses

(61,512)

(82,739)

(70,566)

(52,509)

(45,149)

(267,326)

(138,800)

Less: Income tax benefit (expense)

2,439

7,243

131,954

(4,988)

234

136,648

136

Pre-provision net revenue

$          82,664

$          118,694

$     120,672

$       98,333

$          74,023

$        420,363

$        157,244

For the three months ended

For the year ended

December 31,

2022

September 30,2022

June 30,2022

March 31,

2022

December 31,2021

December 31,

2022

December 31,

2021

Non-interest income

$        127,465

$         181,237

$     213,832

$     189,857

$        179,111

$        712,391

$        605,799

Net interest income

135,243

123,676

116,226

99,680

83,132

474,825

212,831

Total net revenue

262,708

304,913

330,058

289,537

262,243

1,187,216

818,630

Non-interest expense

(180,044)

(186,219)

(209,386)

(191,204)

(188,220)

(766,853)

(661,386)

Pre-provision net revenue

82,664

118,694

120,672

98,333

74,023

420,363

157,244

Provision for credit losses

(61,512)

(82,739)

(70,566)

(52,509)

(45,149)

(267,326)

(138,800)

Income before income tax benefit

21,152

35,955

50,106

45,824

28,874

153,037

18,444

Income tax benefit

2,439

7,243

131,954

(4,988)

234

136,648

136

GAAP Net income

$          23,591

$            43,198

$     182,060

$       40,836

$          29,108

$        289,685

$          18,580

 

Net Income Excluding Income Tax Benefit and Diluted EPS Excluding Income Tax Benefit

For the three months ended

For the

year ended

December 31,

2022

September 30,2022

June 30,2022

December 31,

2022

GAAP Net income

$             23,591

$             43,198

$           182,060

$           289,685

Less: Income tax benefit from release of tax valuation allowance

3,180

5,015

135,300

143,495

Net income excluding income tax benefit

$             20,411

$             38,183

$             46,760

$           146,190

GAAP Diluted EPS – common stockholders

$                 0.22

$                 0.41

$                 1.73

$                 2.79

(A)

Income tax benefit from release of tax valuation allowance

$               3,180

$               5,015

$           135,300

$           143,495

(B)

Weighted-average common shares – Diluted

105,984,612

105,853,938

105,042,626

104,001,288

(A/B)

Diluted EPS impact of income tax benefit

$                 0.03

$                 0.05

$                 1.29

$                 1.38

Diluted EPS excluding income tax benefit

$                 0.19

$                 0.36

$                 0.44

$                 1.41

 

LENDINGCLUB CORPORATION

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (Continued)

(In thousands, except share and per share data)

(Unaudited)

Tangible Book Value Per Common Share

December 31,

2022

September 30,2022

June 30,2022

March 31,

2022

December 31,

2021

GAAP common equity

$       1,164,294

$       1,121,410

$  1,079,117

$     887,434

$          850,242

Less: Goodwill

(75,717)

(75,717)

(75,717)

(75,717)

(75,717)

Less: Intangible assets

(16,334)

(17,512)

(18,690)

(19,886)

(21,181)

Tangible common equity

$       1,072,243

$       1,028,181

$     984,710

$     791,831

$          753,344

Book value per common share

GAAP common equity

$       1,164,294

$       1,121,410

$  1,079,117

$     887,434

$          850,242

Common shares issued and outstanding

106,546,995

105,088,761

103,630,776

102,194,037

101,043,924

Book value per common share

$              10.93

$              10.67

$         10.41

$           8.68

$                8.41

Tangible book value per common share

Tangible common equity

$       1,072,243

$       1,028,181

$     984,710

$     791,831

$          753,344

Common shares issued and outstanding

106,546,995

105,088,761

103,630,776

102,194,037

101,043,924

Tangible book value per common share

$              10.06

$                9.78

$           9.50

$           7.75

$                7.46

 

 

Cision View original content to download multimedia:https://www.prnewswire.com/news-releases/lendingclub-reports-fourth-quarter-and-full-year-2022-results-301730874.html

SOURCE LendingClub Corporation


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