Lending Club and Small Bank Alliance Plan New Consumer Loan Program
According to a February 9 press release from Lending Club:
On February 9, Lending Club announced a new partnership with Alliance Partners, which manages the BancAlliance network, a national consortium of 200 community banks. Through this partnership, members of BancAlliance will be able to offer access to co-branded personal loans to their customers through the Lending Club platform, as well as purchase certain of these consumer loans and others for their portfolios. This program is designed to give community banks and their customers access to the benefits of the Lending Club platform's low cost of operations paired with the banks' low cost of capital to help drive down the cost of credit for consumers.
"We founded BancAlliance as a collaborative solution to empower community banks to compete, together, in attractive lending markets that are typically controlled by the biggest banks,” said Brian Graham, CEO of Alliance Partners. “Community banks deliver extraordinary service and high customer satisfaction locally but often lack the economies of scale of the largest banks. This partnership with Lending Club is another way in which BancAlliance gives community banks the tools they need to serve their customers more fully, in this case by expanding their consumer loan offerings."
Founded in 2011, BancAlliance provides community banks a collaborative solution for accessing attractive lending markets typically dominated by larger banks. BankAlliance has community banks operating in 39 states with assets ranging from $200 million to $10 billion. In aggregate, BancAlliance would rank fourth in branch count among all U.S. banks and 14th in assets.
"Community banks are the lifeblood of American communities,” said Renaud Laplanche, founder and CEO of Lending Club. “This program will help them level the playing field with national banks by offering affordable, consumer-friendly loans to their customers. We're excited to make Lending Club's low cost of operations available to community banks, for the greater benefit of their customers."
"By partnering with Lending Club through BancAlliance, our bank can offer access to a responsible product to our customers while at the same time acquiring assets with which we are very familiar and that offer higher returns than many alternatives,” said Mark Pitkin, President & CEO of BancAlliance member Sugar River Bank. “As a former regulator, I also appreciate having access to the legal, regulatory, compliance and credit experts at BancAlliance that helped us vet the Lending Club program."
All loans are made by WebBank, a Utah-chartered industrial bank that is a member of the FDIC. According to the bank’s website, WebBank partners with companies to provide niche financing to businesses and consumers through its nationwide platform for consumer and commercial private-label products and services for their clients.
Sources:
Wall Street Journal
Ryan Tracy
February 9, 2015
Press Release
LendingClub
February 9, 2015
