[Editor’s note: This is a guest post by David Johnson. David is the Chief Executive Officer at First Associates, the fastest growing loan servicer in the country with a $7 billion dollar portfolio under management for various asset classes including P2P and P2B loans. As CEO, Johnson increased revenues at First Associates by 20x in just three years.]
Marketplace lending reliance on non-deposit funds for lending capital is driving increasing securitization volume. Marketplace lenders aiming to rise to the top of the pack would be well-advised to start planning for securitization now, if they haven’t already.
For those both contemplating and completing securitization, PeerIQ Research has initiated a series of reports called the Marketplace Lending Securitization Tracker, starting with third quarter 2015. The reports track various elements of securitized marketplace lending progress and performance.
According to the inaugural report, “As the sector continues to scale—with a projected $50B in total US originations by end of 2015—origination platforms, loan purchasers, and other market participants are increasingly looking to the [Asset-Backed Securities] ABS markets to meet their funding needs…Securitization is an essential link in the funding chain connecting originators to institutional investors in the capital markets. A transparent, simple, high-quality securitization market with active repeat issuance will connect marketplace lenders to long-term, low-cost, and diverse capital base, thereby reducing the funding risk through all credit environments.” [Read more…]