PeerIQ is please to present our Marketplace Lending Securitization Tracker for 4Q2015.  Highlights include:

  • The fourth quarter saw an acceleration in marketplace lending (MPL) securitization activity despite wider credit spreads. There were 9 new deals issued for a total par amount of $2.7bn, representing over 30% of cumulative issuance to date and an 5x increase in issuance from the corresponding quarter in 2014 ($0.5bn). 
  • Total cumulative securitizations now stands at $8.4bn, with 41 deals issued to date (25 Consumer, 9 Student, and 7 Small Business).  
  • Consumer MPL established a significant lead in 4Q15. Heading into the fourth quarter, cumulative Consumer MPL securitization stood at $2.3bn, slightly above Student Loan MPL securitization at $1.9bn. That gap widened in 4Q, with cumulative Consumer issuance now representing almost twice that of Student, the next leading category.  
  • More rated tranches. The fourth quarter saw the issuance of 9 tranches rated by at least one ratings agency—the most out of any quarter to date—possibly suggesting that ratings agencies might be growing more comfortable with certain Consumer MPL originators.
  • In the long term, this bodes well for originators as well as investors.  Increased volumes and comfort levels with the asset class should ultimately lead to a reduction in risk premia required by investors (holding other factors constant) over the long term. This leads to a lower funding cost (again, all else equal) for balance sheet originators and investors funding loans on marketplace platforms.

Please feel free to download and view our tracker online at your convenience.