LendingClub’s LCX evolves to offer increased liquidity & marketplace functionalities

By Pavithra R

LendingClub Corporation, an online lending marketplace connecting borrowers and investors, has announced the expansion its LCX platform to make it easier for registered institutional investors to analyse, price, and bid on loans at the time a loan is originated (pre-issuance), down to the individual loan level.

When the platform was launched, LendingClub through LCX was able to sell previously originated loans at dynamic and competitive prices, from LendingClub’s balance sheet. With the expansion, the company can now sell loans at dynamic pricing before they are originated. These loans do not hit the company’s balance sheet, helping the firm preserve liquidity.

“As a technology-driven marketplace, we want to remove friction and encourage investors to trade electronically and with precision whether its pre-issuance or post-issuance, with LendingClub or each other. We believe this will result in increased liquidity of this asset class and add marketplace functionality that previously did not exist. We expect to continue to utilise new technology to make this asset both more tradeable and investable while improving the experience for platform investors. We believe this evolution will be a major part of our goal of continuing to provide market-based rates for borrowers and competitive risk-adjusted returns for investors,” said Patrick Coicou, LendingClub Senior Director Electronic Markets.

The LCX’s expansion also increases investors’ ability to evaluate and execute their purchase strategies with enhanced precision in a real-time, data-rich environment. Loans will be offered on the LendingClub marketplace multiple times a day. The expansion is another evolution of the way LendingClub is selling loans in response to changing market conditions. LendingClub enables electronic trading for faster deployment of capital, improved liquidity, price discovery and an efficient and scalable order execution process.

“We’re excited to continue working together with LendingClub to create market-leading solutions. This LCX expansion is the next evolution in allowing investors to pinpoint risk and increase liquidity,” said Gal Krubiner, CEO and Co-Founder of Pagaya Investments.

Founded in 2006, LendingClub aims to transform the banking system to make credit more affordable and investing more rewarding. The firm offers loans to institutional investors through four platforms: Scale, Select, Select Plus, and the combined LCX suite.