LendingClub Corporation (NYSE:LC) Q2 2020 Earnings Conference Call - Final Transcript

Aug 04, 2020 • 05:00 pm ET


LendingClub Corporation (NYSE:LC) Q2 2020 Earnings Conference Call - Final Transcript


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Good afternoon, and welcome to LendingClub's Second Quarter 2020 Earnings Conference Call. [Operator Instructions] I would now like to turn the conference over to Sameer Gokhale. Please go ahead.

Sameer Gokhale

Thank you, and good afternoon. Welcome to LendingClub's second quarter 2020 earnings conference call. Joining me today to talk about our results and recent events are Scott Sanborn, CEO; and Tom Casey, CFO.

Our remarks today will include forward-looking statements that are based on our current expectations and forecasts and involve risks and uncertainties. These statements include, but are not limited to, the impact of COVID-19, our ability to navigate the current economic environment, the timing and benefits of our pending acquisition of Radius, platform volume, and the future performance of our business and products. Our actual results may differ materially from those contemplated by these forward-looking statements. Factors that could cause these results to differ materially are described in today's press release and our most recent forms 10-K and 10-Q, each as filed with the SEC, as well as our subsequent filings made with the Securities and Exchange Commission, including our upcoming Form 10-Q. Any forward-looking statements that we make on this call are based on assumptions as of today, and we undertake no obligation to update these statements as a result of new information or future events.

Also, during this call, we will present and discuss both GAAP and non-GAAP financial measures. A description of non-GAAP measures and reconciliation to GAAP measures are included in today's earnings press release and related slide presentation. The press release and accompanying presentation are available through the Investor Relations section of our website at ir.lendingclub.com.

And now, I'd like to turn the call over to Scott. Scott?

Scott Sanborn

All right. Thank you, Sameer, and thank you, everyone, for joining us. I hope everyone is staying healthy. Earlier today, we reported our financial results for the second quarter, which were primarily driven by the significant decline in origination volume that we had anticipated.

While it is clearly a challenging and an uncertain environment, we are successfully managing our liquidity. We feel good about how we've positioned the company to ride this out. So, we do believe that Q2 represents the trough in terms of loan investor demand and our reported financial results. Furthermore, we believe that this recession is allowing us to demonstrate the resilience of our asset class, the depth of our membership base and the strength of our digital underwriting and servicing capabilities.

While there is certainly a long road ahead, as Q3 gets underway, we are seeing the early signs of green shoots with recent sales of multiple loan portfolios at or above their carrying value and five of our top 10 investors now back on the platform purchasing new issuance, albeit at modest levels. With a gradual resumption of investor activity and our restructuring and associated costs behind us, we are appropriately sized to preserve our cash while maintaining the capacity to rebound when it appears prudent to do so.

We believe