LendingClub Suddenly Halts Lending
Today LendingClub stopped allowing new lenders to register and fund loans on their site, and entered a “quiet period” in which they will not issue public statements or talk to the press. LendingClub posted this official statement on their web site:
Lending Club has started a process to register, with the appropriate securities authorities, promissory notes that may be offered and sold to lenders through our site in the future. Until we complete the registration process, we will not accept new lender registrations or allow new commitments from existing lenders. We will continue to service all previously funded loans during this period, and lenders will be able to access their accounts, monitor their portfolios, and withdraw available funds without changes.
The borrowing side of our site will remain generally unaffected by this registration process; borrowers can continue to apply for loans and new loans posted after April 7, 2008, will be funded and held only by Lending Club.
Until the registration process is completed, the company will undergo a quiet period and will not be able to respond to press and other inquiries about Lending Club or the registration process during that time.
Borrowers continue to post loan requests, but without lenders, it is hard to imagine that they would be fulfilled. It looks like some loans are being funded by LendingClub themselves, but this doesn’t seem like a sustainable solution.
Although no public complaint has been issued, It is suspected that LendingClub has been asked to shut down by the US Securities and Exchange Commission, and that LendingClub complied for fear of receiving a formal cease and desist, which would hurt its reputation and prevent it from raising further capital.
Related posts:
- Prosper Closes Site, Enters Quiet Period
One day after Lending Club’s regulatory approval and site launch, Prosper has closed their site to new loan funding, and announced that they will be seeking regulatory approval... - LendingClub launches social P2P lending site on Facebook
LendingClub, a new person-to-person lending site based in Sunnyvale, CA, launched during last night’s Facebook f8 event in San Francisco. LendingClub, headed by founder and CEO Renaud Laplanche,... - LendingClub Proposes New Structure in S-1 Filing
LendingClub has filed an S-1 with the SEC, in which it proposes a new regulatory structure for person to person lending, as well as providing some interesting data... - LendingClub introduces mapping, top lenders list
In an email announcement that went out to active lenders last week, LendingClub previewed a couple of new upcoming features.... - LendingClub raises $10.2M Series A
On August 23, LendingClub announced that they were about to close a Series A round of funding for $10.2 million from Norwest Venture Partners and Canaan Partners. This first round...
[...] April 2008, Lending Club went into a self-imposed quiet period to register with the SEC. During that six month period, Lending Club continued funding a select [...]
[...] damaging of progressive and innovative business models. In the world of P2P lending, we have seen Lending Club, Prosper, Boober (NL), Loanio, and IOU Central all close their businesses (or suspend them, at [...]
[...] in all, a 2-month shutdown is much better than the 6- and 9-month shutdowns suffered by LendingClub and Prosper, respectively. But it would be nice if regulators would take the time to understand [...]
[...] month ever. That high water mark was set back in March 2008, shortly before Lending Club closed down for SEC registration. Loans during that period likely included a high volume ofloans funded by [...]