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Alternative finance marketplace Lending Club has entered into an agreement with the U.S. branch of Alibaba to offer financing to American businesses to buy parts from Chinese manufacturers through the Alibaba marketplace.
February 3 -
Marketplace lenders are seizing on current investor enthusiasm after the December public listing of LendingClub. SoFi and Funding Circle have set new origination targets, and new capital markets deals may help replace bank credit lines for Blue Elephant Capital Management and perhaps others.
January 28 -
Peer-to-peer and institution-to-small business loan marketplace Funding Circle launched a new fractional loan marketplace today, the San Francisco company announced.
January 27 -
Like General Motors extending credit to car dealers, Google will use Lending Club to finance resellers, service providers, and consultants in its supply chain while putting to work a portion of the tech giant's cash war chest.
January 26 -
Online marketplace lending platforms are filling real needs. But few banks participate in this booming niche, reflecting the industry's risk aversion and regulatory concerns as well as resistance to change.
January 22 -
Because of a regulatory quirk, Lending Club and its competitors depend on banks to issue their loans. The set-up raises questions about the regulatory outlook for the fast-growing marketplace lending sector.
December 18
Marlette Funding, an
"Banks aren't lending, but boy do they have lots of deposits," CEO Jeffrey Meiler said. "We would need to originate deposits with a bank partner, in the same way we originate assets."
Banks have not been keen on the idea, though some have expressed "meaningful interest," he said, declining to name those firms.
"FDIC-insured is important. There's no way we could do this without a bank partner."
Marlette has a funding line with Cross River Bank in Teaneck, N.J. As with
His company has eight end-buyers to purchase its loans, including asset managers, family offices, and banks, Meiler said. Those parties have purchased 100% of Marlette's loans.
"We will start retaining loans in the second quarter," Meiler said. "Our assumption, for every dollar, it takes 20 cents of equity. We will need to take on some more equity to become a balance sheet lender. We need to raise more equity over time."
Marlette, which offers institutional investors only the chance to buy its unsecured three- and five-year loans of up to $35,000, has a run rate that if maintained would bring full-year 2015 originations to $800 million. The firm made $215 million in loans in the fourth quarter. That origination rate is accelerating, though, Meiler said.
