# LendingClub Reports Fourth Quarter and Full Year 2022 Results

January 25, 2023

*Delivers Record Full Year Revenue and Earnings Growth Despite Challenging Environment*

SAN FRANCISCO, Jan. 25, 2023 /PRNewswire/ -- LendingClub Corporation (NYSE: LC), the parent company of LendingClub Bank, America's leading digital marketplace bank, today announced financial results for the fourth quarter and full year ended December 31, 2022.

"Our fourth quarter results clearly demonstrated the benefits of our evolution into a marketplace bank. We significantly grew recurring revenue to offset the expected reduction in marketplace volumes," said Scott Sanborn, LendingClub CEO. "Looking ahead, in anticipation of a more challenging environment, we have streamlined our operations and will maintain our underwriting discipline. We also intend to remain profitable, while investing in-period earnings into loan retention to support future earnings. These actions will allow us to capitalize on growth opportunities as economic pressures abate."

## Full Year 2022 Results Reflect Ongoing Transformation and Positioning for Long-Term Sustained Success

Total assets increased 63% year over year to $8.0 billion, primarily reflecting growth in loans held for investment, including the acquisition of a $1.05 billion outstanding principal loan portfolio in the fourth quarter of 2022.

Deposits of $6.4 billion more than doubled, primarily due to growth in online savings deposits.

- Total net revenue of $1.2 billion up 45% year over year.
- Net interest income, a recurring stream of earnings, increased over 100% to $474.8 million.
- Marketplace revenue grew 18% year over year to $683.6 million.
- Pre-tax income of $153.0 million compared to $18.4 million in the prior year, reflecting solid revenue growth combined with improved operating efficiency.
- Implemented significant cost reduction plan to more closely align the company's expense base with anticipated loan volume in 2023.

## Fourth Quarter 2022 Results

Total net revenue of $262.7 million was comparable to the prior-year period, as strong growth in net interest income offset lower marketplace revenue.

- Net interest income increased 63% year over year to $135.2 million.
- Total loans and leases held for investment grew 104%, primarily reflecting growth in personal loan originations held for investment and the acquisition of a $1.05 billion loan portfolio in the fourth quarter of 2022.
- Net interest margin expanded to 7.8% from 7.6% in the prior-year period, primarily reflecting a greater mix of personal loans which generate a higher yield than the other loans held for investment.
- Marketplace revenue was $123.4 million compared to $170.6 million year over year, reflecting a reduction in volumes consistent with the change in total origination volume due to the pace of Federal Reserve interest rate increases and tighter underwriting standards implemented by the company.
- Loan originations were $2.5 billion, compared to $3.1 billion in the prior-year period.
- Credit quality of the held-for-investment prime loan portfolio remained strong, with delinquency rates continuing to normalize as the portfolio seasons.
- Provision for credit losses of $61.5 million primarily reflects $700.8 million of quarterly loan originations held for investment and ongoing recognition of provision expense for discounted lifetime losses at origination.
- Pre-provision net revenue of $82.7 million grew 12% year over year, driven by improved operating efficiency.
- Efficiency ratio improved to 69% from 72% in the prior-year period due to better marketing efficiency.
- Net income of $23.6 million compared to $29.1 million year over year, reflecting higher credit provisioning due to growth in the held-for-investment portfolio, partially offset by favorable marketing efficiency.
- Total equity of $1.2 billion grew $314.1 million from December 31, 2021, primarily reflecting net income generated over the period and the release of the deferred tax asset valuation allowance.
- Book value per common share of $10.93 increased 30% from December 31, 2021. Tangible book value per common share of $10.06 increased 35% from December 31, 2021. The increases in book value and tangible book value per share were consistent with the growth in total equity.
- Substantial capital with a consolidated Tier 1 leverage ratio of 14.1% and consolidated Common Equity Tier 1 capital ratio of 15.8%.

| ($ in millions, except per share amounts) | Three Months Ended |   |   | Year Ended |   |
| --- | --- | --- | --- | --- | --- |
|  | December 31,2022 | September 30,2022 | December 31,2021 | December 31,2022 | December 31,2021 |
| Total net revenue | 262.7 | 304.9 | 262.2 | 1,187.2 | 818.6 |
| Non-interest expense | 180.0 | 186.2 | 188.2 | 766.9 | 661.4 |
| Pre-provision net revenue(1) | 82.7 | 118.7 | 74.0 | 420.3 | 157.2 |
| Provision for credit losses | 61.5 | 82.7 | 45.1 | 267.3 | 138.8 |
| Income before income tax benefit | 21.2 | 36.0 | 28.9 | 153.0 | 18.4 |
| Income tax benefit | 2.4 | 7.2 | 0.2 | 136.6 | 0.1 |
| Net income | 23.6 | 43.2 | 29.1 | 289.7 | 18.6 |
| Diluted EPS | 0.22 | 0.41 | 0.27 | 2.79 | 0.18 |
| Income tax benefit from release of tax valuation allowance | $3.2 | 5.0 | — | 143.5 | — |
| Net income excluding income tax benefit(1,2) | $0.19 | 0.36 | 0.27 | 1.41 | 0.18 |
| Diluted EPS excluding income tax benefit(1,2) |   |   |   |   |   |

## Financial Outlook

Given the rapid change in the economic environment, the company is currently providing guidance for the first quarter of 2023 and expects loan originations and pre-provision net revenue to be in the ranges below. The outlook for loan originations reflects the impact of rising rates on marketplace demand combined with continued prudent underwriting. The company plans to maintain held-for-investment loan balances in line with the fourth quarter of 2022. For 2023, the company intends to remain profitable, while investing in-period earnings into loan retention to support future earnings.

|  | First Quarter 2023 |
| --- | --- |
| Loan Originations | $1.9B to $2.2B |
| Pre-Provision Net Revenue | $55M to $70M |

## About LendingClub

LendingClub Corporation (NYSE: LC) is the parent company of LendingClub Bank, National Association, Member FDIC. LendingClub Bank is the leading digital marketplace bank in the U.S., where members can access a broad range of financial products and services designed to help them pay less when borrowing and earn more when saving. Based on more than 150 billion cells of data and over $80 billion in loans, our advanced credit decisioning and machine-learning models are used across the customer lifecycle to expand seamless access to credit for our members, while generating compelling risk-adjusted returns for our loan investors. Since 2007, more than 4.5 million members have joined the Club to help reach their financial goals. For more information about LendingClub, visit https://www.lendingclub.com.