18 February 2018
visit www.ebaday.com

Lending Club CEO resigns after review into loan sales

09 May 2016  |  5481 views  |  0 Stock market graph on screen

Shares in Lending Club plunged in pre-market trading on news that chief executive and chairman Renaud Laplanche has quit after an internal review of loan sales to an investor.

Laplanche, the online lending marketplace's founder, resigned after a review found that sales of $22 million in near-prime loans to a single institutional investor were "in contravention of the investor's express instructions as to a non-credit and non-pricing element".

President Scott Sanborn will take on the role of acting CEO, supported by director Hans Morris, who has assumed the newly created position of executive chairman.

Says Morris: "While the financial impact of this $22 million in loan sales was minor, a violation of the Company's business practices along with a lack of full disclosure during the review was unacceptable to the board. Accordingly, the board took swift and decisive action, and authorized additional remedial steps to rectify these issues."

The internal review also found another issue "involving a failure to inform the board’s Risk Committee of personal interests held in a third party fund while the Company was contemplating an investment in the same fund".

Meanwhile, the firm has posted first quarter operating revenues of $151.3 million, an increase of 87% year-over-year. Net income was $4.1 million, or one cent a share, compared with a loss of $6.4 million, or two cents, the year before.

The company has decided that it is "prudent" not to provide guidance at the moment as it bids to resolve the weaknesses found in its internal controls.

Lending Club faces other problems too; the online marketplace sector has been facing a tough time in recent months thanks to a tightening of the capital markets. Last week it emerged that Prosper is slashing its workforce by 28%, while OnDeck Capital recently reported disappointing financial results.
KeywordsPEOPLE

Comments: (0)

Comment on this story (membership required)

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board: sign up now

Related stories

Prosper slashes workforce as online lenders feel the heat

Prosper slashes workforce as online lenders feel the heat

04 May 2016  |  6274 views  |  2 comments | 11 tweets | 8 linkedin
Alibaba eschews bank financing in favour of Lending Club tie-up

Alibaba eschews bank financing in favour of Lending Club tie-up

03 February 2015  |  9434 views  |  3 comments | 21 tweets | 24 linkedin
Google partners Lending Club on biz financing programme

Google partners Lending Club on biz financing programme

15 January 2015  |  12146 views  |  0 comments | 18 tweets | 10 linkedin
Lending Club shares soar on market debut

Lending Club shares soar on market debut

11 December 2014  |  6299 views  |  0 comments | 9 tweets | 7 linkedin
Lending Club preps $500m IPO

Lending Club preps $500m IPO

28 August 2014  |  4260 views  |  0 comments | 4 tweets | 2 linkedin
Lending Club moves out of Facebook with new community site

Lending Club moves out of Facebook with new community site

14 September 2007  |  8143 views  |  0 comments

Related company news

 

Related blogs

Create a blog about this story (membership required)
visit www.swift.com/your-needs/instant-paymentsvisit http://info.nice.comvisit www.ebaday.com

Who is commenting?

Top topics

Most viewed Most shared
Saudi central bank provides sandbox for banks to try out Ripple techSaudi central bank provides sandbox for ba...
10470 views comments | 16 tweets | 11 linkedin
Aussie real-time payments platform goes liveAussie real-time payments platform goes li...
8257 views comments | 15 tweets | 41 linkedin
ECB launches staunch defence of cashECB launches staunch defence of cash
7746 views 10 comments | 21 tweets | 26 linkedin
hands typing furiouslyHow can Blockchain Help with AML KYC
7619 views 3 | 9 tweets | 4 linkedin

Featured job

Basic c. EUR 90K OTE c. EUR 180K plus full bene...
Paris (preferred) or London

Find your next job