Online credit marketplace LendingClub acquires Radius Bank

Online credit marketplace LendingClub acquires Radius Bank

P2P pioneer LendingClub is to become the first US fintech to acquire a bank, agreeing a $185 million deal for online-only Radius Bank.

The deal will allow LendingClub to circumvent regulatory barriers, reduce borrowing costs and offer a full spectrum of banking services to members.

Founded in 1987 and based in Boston, Radius has more than $1.4 billion in assets. The online-only bank offers check deposit, bill pay, card management, and a personal financial management dashboard, as well as open APIs to offer 'banking-as-a-service' (BaaS) functionality to fintechs. In addition, the company offers commercial lending options for businesses, and treasury management services for pension funds, unions, municipalities, and non-profit organizations.

"This is a transformational transaction that allows us to reimagine banking in a way that is free from legacy practices and systems and where the success of LendingClub is aligned with the success of our customers," says Scott Sanborn, CEO of LendingClub. "By combining with Radius, we will create a category-defining experience for our members that will dramatically enhance the resilience and earnings trajectory of our business."

He says the deal will help save $40 million a year in bank fees and funding costs and will allow the company to earn a spread on loans kept on its balance sheet.

The transaction is expected to close within 15 months and reach breakeven within two years.

Comments: (0)

Trending Stories

Related News
Featured Job
All Jobs »