A Lending Club banner hangs on the facade of the the New York Stock Exchange in New York, New York, United States December 11, 2014. REUTERS/Brendan McDermid/File Photo NEW YORK (IFR) - Jefferies has revived its stalled Lending Club loan securitization in a club-style deal it has begun to pre-market to only a few select investors, two buyside sources with knowledge of the trade told IFR. The roughly US$140m bond was put on hold in May after the resignation of Lending Club’s CEO Renaud Laplanche. The bank is now looking to sell a two-tranche trade that could offer yields in the 4.25%-7% range, one of the investors said. The top class of notes of slightly less than one-year were about 60% subscribed, while a longer 2-year tranche was already fully covered, the investor said. The near-prime loan securitization was shelved after Lending Club said it had repurchased a US$22m pool of loans sold to Jefferies under Laplanche’s watch that included falsified documentation. The scandal put the fledgling online industry in the regulatory spotlight, including probes by the Department of Justice and the New York Department of Financial Services. Goldman Sachs also hit pause on its potential bond sale of prime Lending Club loans. But bankers told IFR that Goldman could now look to revive its bond deal, if the Jefferies trade finds favor with investors. Jefferies did not immediately respond to a request for comment. Reporting by Joy Wiltermuth; editing by Shankar Ramakrishnan
Joy Wiltermuth is rumoured to be helping revive Lending Club’s hindered loan securitisation via a bond deal that is being pre-marketed to select investors, according to buyside sources quoted by Reuters. The bond, worth around $140m, was put on hold upon the resignation of Lending Club’s CEO back in May, and Joy Wiltermuth is now said to be considering selling a two-tranche trade that is predicted to offer yields between 4.25% and 7%. The sources added that the top class note of less than one year is approximately 60% subscribed, while the longer two-year note was said to be fully covered. If the deal is successful, it is thought that Goldman Sachs may revive its own Lending Club bond deal.