Weekly Industry Update: December 11, 2016

By Vy Phan

December 11, 2016

It was great to see so many MPL participants this past week at the Opal Group’s Marketplace Lending & Alternative Financing Summit. The OCC’s move to authorize national bank charters for fintechs dominated conversations there, including whether (and which) fintechs might ultimately seek to avail themselves of the pre-emption benefit. We refer readers to PeerIQ's analysis of the OCC charter's supervisory guidelines for more.

Also this week, Moody’s released its 2017 Credit Quality Outlook, finding that the credit quality of MPL loans backing ABS should remain stable in 2017. Finally, on the securitization front, SoFi made headlines, announcing the pricing of their first mortgage transaction (SoFi Mortgage Trust Series 2016-1) of $168M+ in prime jumbo RMBS. The firm also announced their 7th student loan transaction this year (SOFI 2016-F). Upcoming Conferences:

SFIG Vegas on February 26-March 1.

LendIt on March 6-7 in New York,

PeerIQ in the News:

ABS, Bank Partnerships to Lift Marketplace Lending (SCI, 12/8/16)

Weekly Briefing No. 57 | A Fintech Judgement of Solomon (The Financial Revolutionist, 12/3/16)

Industry Update:

Fintech Charter Likely to Lure Suitors, Despite Regulatory Burden (BNA, 12/2/16) The payoff of preemption will likely attract fintech companies to apply for a national charter from the OCC despite regulatory hurdles.

Banking on Change: Tech Startups Target Financial Services (NYT, 12/8/16) The financial services industry described as “ripe for disruption,” and further validated by the OCC’s recent announcement regarding national bank charters.

Cross River Says It Could Advise Fintechs Under New Charter (AmericanBanker, 12/6/16) OCC presents opportunity for banks such as Cross River Bank to offer guidance on compliance.

Finance Watchdog CEO: Peer-to-peer's Evolution Poses 'Big Challenges' for 'Transparency and Fairness' (Business Insider, 12/9/16) FCA is pushing for greater transparency on risks posed to investors, calling for more disclosure surrounding developing platforms’ complex business models.

SEC Urges LendingClub to Disclose More About Loans and Funding (WSJ, 12/7/16) SEC urges LendingClub to disclose more about its lending operations.

2017 Outlook - Credit Quality Will Be Generally Steady as Lenders Look to Reestablish Confidence (Moody’s, 12/5/16) Moody’s 2017 predictions for US MPL ABS market: Little change to credit quality of new transactions, stable asset performance of outstanding deals, continued uncertainty surrounding the legal and regulatory landscape, and increases in securitization issuance.

UK Regulator Signals Tougher Peer-to-Peer Lending Rules (FT, 12/9/16) FCA seeks to bolster protection for investors in P2P market.

LendingHome Exceeds $1B in Mortgage Loan Originations (VentureBeat, 12/8/16) LendingHome launches new master trust securitization vehicle to accelerate capital growth—this is the first of its kind in the MPL space.

Lighter Fare:

Two Friends Who Changed How We Think About How We Think (New Yorker, 12/7/16) Bestselling author of “MoneyBall,” Michael Lewis examines the partnership between two esteemed psychologists and the impact of their work in psychology and economics in his new book, “The Undoing Project: A Friendship That Changed Our Minds.”