The unemployment rate dropped to a near five decades low of 3.8% even as nonfarm payrolls only rose by 20K. Average hourly earnings rose by 3.4%, above economists’ expectations. The Fed is on hold and is watching incoming data to determine the timing of the next rate hike.
US credit card balances reached their highest level of $870 Bn at the end of 2018. Available credit limits also reached their highest level of nearly $3 Tn. Overall debt outstanding also reached a record $13.5 Tn, although debt burdens remain near low on a per-capita and on a percentage of disposable income basis. Borrowers, however, are paying higher interest rates as a share of household spending:
Source: Deutsche Bank Research, WSJ
In securitization news, KBRA has rated the senior tranche on Avant’s first deal of 2019 A. AVNT 2019-A is a $284 Mn securitization. The pool consists of ~55 k loans with an average loan balance of $5.6 k. The weighted average loan term is 36 months and the borrowers’ weighted average FICO score is 649.
Kabbage is out with its 2nd securitization. KBRA has rated the senior tranche on KABB 2019-1 AA. KABB 2019-1 is a $610 Mn securitization with a 36-month revolving period, similar to that on the KABB 2017-1 deal. The pool consists of 91 k loans with an average balance of $7.3 k. The weighted average term of the loans is 10 months and the borrowers’ weighted average FICO score is 702. KABB 2017-1 is still within its revolving period and is currently passing all triggers.
PeerIQ has been nominated for the “Most Promising Partnership” award at LendIt for our partnership with TransUnion.
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GreenSky’s Strong 4Q2018 Earnings
GreenSky’s 4Q revenue grew by 22% YoY to $109 Mn, although net income fell by nearly 43% YoY to $23 Mn. The stock rose by ~6% post earnings.
- Transaction volume increased by 23% YoY to $1.3 Bn.
- Loan servicing portfolio increased by 36% YoY to $7.3 Bn.
- GSKY had aggregate commitments of $11.8 Bn from its nine bank partners, of which $4.8 Bn were unused.
- 30+ DQ rates rose slightly YoY from 145 bps to 148 bps.
- GreenSky now has nearly 12 k home improvement merchant partners and nearly 3 k elective healthcare partners.
Source: GreenSky, PeerIQ
- Hiring Plunges to 20,000 as Wage Gains Top Estimates (Bloomberg, 3/8/19) The unemployment rate dropped to a near five decades low of 3.8% even as nonfarm payrolls only rose by 20 k.
- Credit Card Debt Closed 2018 at a Record $870 Billion (Bloomberg, 3/8/19) US credit card balances reached their highest level of $870 Bn at the end of 2018.
- AVNT 2019-A PreSale (KBRA, 3/7/19) KBRA has rated the senior tranche on Avant’s first deal of 2019 A-.
- KABB 2019-1 PreSale (KBRA, 3/6/19) KBRA has rated the senior tranche on KABB 2019-1 AA.
- GreenSky, Inc. Reports Full Year 2018 Financial Results (BusinessWire, 3/5/19) GreenSky’s 4Q revenue grew by 22% YoY to $109 Mn, although net income fell by nearly 43% YoY to $23 Mn.
- US Mobile Bank Chime Raises $200 Mn (TechCrunch, 3/5/19) Chime, a digital bank, raised $200 Mn in a Series D round led by DST Global. Chime will use the financing to expand its product offerings.
- Prosper Performance Update: January 2019 (Prosper, January 2019) Originations in Jan had a weighted average FICO score of 719. Weighted average interest rate decreased by 50 bps MoM.
- Fifth Third Bancorp Receives Regulatory Approvals for Merger with MB Financial (FifthThird, 3/7/19) FifthThird’s merger with MBFI has been approved. The approval comes on the heels of the merger announcement of SunTrust and BB&T.
- Two Astronauts Will Conduct First All-Woman Spacewalk (Popular Mechanics, 3/6/19) As we celebrate International Women’s Day, two astronauts will conduct the first all-female spacewalk on March 29th 2019.