Weekly Industry Update: SFIG Vegas 2017 Recap

By March 6, 2017Blog

The SFIG Vegas conference set an attendance record this year, mirroring improved investor sentiment amidst an improving economic backdrop. Several participants drew comparisons to the 2004 environment which also featured a rising rate environment, deregulatory agenda, and conditions leading to an acceleration in ABS volumes.

Fed Chair Janet Yellen signaled a rate increase for March FOMC committee. Fed officials expect a total of three rate hikes this year (75 bps total). Fed futures peg the probability of a March rate hike at over 80%. Originators are expected to raise interest rates on borrowers by a similar amount to maintain net interest margin and cover higher funding costs borne by aggregators.

Financings continue apace. Upstart announced a $32.5 Mn raise and sees an additional opportunity to help banks, credit unions, and retailers originate loans using their SAAS technology. This represents a continuation of the “capital light” theme (see Avant & Regions Bank, or OnDeck and JP Morgan for instance). In a much anticipated deal, Prosper announced a $5 Bn deal across a consortium of investors including affiliates of Third Point, Fortress unit New Residential Mortgage, and Soros Fund Management. 

On the regulatory front, the US District Court of the Southern District of New York issued a decision in Madden v. Midland on remand. The court granted certiorari enabling a class action against Midland to proceed. In an unfortunate setback for lenders and investors, the court rejected the “choice of law” provision in relation to NY residents. The upshot is that the decision preserves the status quo of regulatory uncertainty, and increases the need for congressional action to overturn the Second Circuit’s Madden decision.

For those focused on deal-making at SFIG, we put together a summary of our impressions and takeaways based on dozens of conversations with industry leaders.

SFIG Vegas Recap

This week, several members of the PeerIQ leadership team will be attending LendIt where PeerIQ is nominated for the “Top Service Provider” Award. PeerIQ CEO, Ram Ahluwalia, will give a keynote address on Monday at 10:20AM on the role of securitization in marketplace lending.

Feel free to contact us if you’d like to schedule a meeting.

Conferences:

  • LendIt on March 6-7 in New York. Save 15% on your ticket by using PeerIQ’s VIP code: PEERIQ17USA.
    CEO, Ram Ahluwalia will deliver a keynote address, “Why Securitization and Online Lending are So Important for Each Other,” on March 6 at 10:20AM.

    • PeerIQ will also serve as a judge at the LendIt Awards Ceremony for “Most Innovative Bank” and “Top Consumer Lending Platform.” PeerIQ is nominated for the “Top Service Provider” Award.

PeerIQ the News:

Industry Update:

  • SoFi Pursues New Mortgage Niche (AB Alert, 3/3/17)  SoFi is considering an expansion of its mortgage-lending business to include higher-income borrowers whose accounts don’t meet the CFPB’s “qualified-mortgage” standards.

Lighter Fare: