In today's low-yielding and volatile environment, generating income for your clients is harder than ever. Often it means sacrificing duration or quality for little yield. Consider a new source: investing in prime consumer loans, which can generate income for your clients and differentiate your practice.
Loans facilitated by Lending Club are unique - they are fully amortizing, fixed rate loans (with 3- or 5-year terms) to prime borrowers who want to do things like consolidate debt or make a large purchase.
High Yield Monthly interest and principal payments from prime consumer borrowers.1
Low Risk Investing in loans with short duration can reduce risk and offer low correlation to broad markets.2
Solid Returns Average historical returns range from 5-7%.3
Innovative Offer your clients a unique investment that's changing the face of banking.
Billable Asset Billed above the line with streamlined, integrated reporting.
Easy to Use Build customized client portfolios quickly.
It's free and it takes just minutes
Lending Club’s preferred custodian for Financial Advisors is Millennium Trust Company. Millennium Trust Company charges an annual account fee of $100 for administering each Lending Club account held in custody at Millennium Trust, but we’ll pay the $100 annual account fee for each account that has an initial minimum account balance of $5,000 or more invested in Lending Club Notes and maintains this minimum invested balance for the following 12 months. Lending Club will pay the $100 annual fee in subsequent years for accounts that maintain a minimum invested balance of $10,000 or more invested in Lending Club Notes.
At $3.5 trillion, the consumer credit market is a significant - and overlooked - component of the bond market and yields more than all major fixed income sectors by at least 2x.5
The segment has remained mostly untouched by investors because of unique structural inefficiencies. Lending Club's marketplace turns the process on its head and connects borrowers and investors via an online marketplace. By utilizing technology, we offer lower rates to borrowers and compelling returns to investors.
An average portfolio of Lending Club Notes has outperformed the broad bond market (as measured by the Barclays U.S. Aggregate Bond Index) - and done so with 1/3 the duration.6
Millennium Trust Company, LLC is a custodian for Financial Advisors looking to implement a simple, creative, technology-drive solution for Lending Club notes and other alternative assets. It is a leading provider of alternative asset custody solutions for institutions, advisors and individuals. You can easily use or open your Millennium Trust Company IRA or custodial account to purchase your choice of investments, including the types of alternative investments available through Lending Club. Millennium Trust Company is not affiliated with Lending Club and does not endorse or recommend any platform or investment.7
Millennium Trust Company acts as a directed custodian for IRAs and other custodial accounts and does not provide any investment, tax or legal advice or recommendations to investors, or do any due diligence on any platform or investment for you.
1 Read more about Lending Club's Quality Borrowers.
2 Historical performance is not a guarantee of future results. Lending Club Notes are not guaranteed or insured, and investors may lose some or all of the principal invested.
3 As of December 31, 2016. To be included in the Historical Returns calculation, a Note must have been originated prior to June 30, 2015. Historical Returns are Lending Club's adjusted net annualized returns (Adjusted NAR) for Notes with Grades A through C. Adjusted NAR is calculated using the formula described here. Adjusted NAR is based on monthly borrower payments actually received net of Lending Club's service fees, actual charge offs, recoveries, and adjustment for estimated future losses. To estimate future losses, we apply a loss rate estimate to the outstanding principal of any loans that are past-due but not charged off. The loss rate estimate is based on historical charge off rates by loan status over a 9-month period. Historical Returns are not a promise of future results. Lending Club Notes are not insured or guaranteed and investors may have negative returns. Individual portfolio results may be impacted by, among other things, the diversity of the portfolio, exposure to any single Note or group of Notes, as well as macroeconomic conditions. Notes are offered by prospectus filed with the SEC and you should review the risks and uncertainties described in the prospectus prior to investing in the Notes.
4 Lending Club’s preferred custodian for Financial Advisors is Millennium Trust Company (MTC). For each individual client account, MTC charges an annual account fee of $100 at account opening and then annually on the anniversary of account opening. Lending Club will pay the $100 annual account fee due at account opening if the account has an initial minimum balance of $5,000 invested in Lending Club Notes and maintains this minimum invested balance for the following 12 months. For every subsequent year in which an individual client account maintains a minimum invested balance of at least $10,000 or more invested in Lending Club Notes, Lending Club will pay the annual account fee of $100. All account invested balances are determined as of the last business day immediately prior to the anniversary date of the opening of the account. The individual client account will be responsible for the account fee for any accounts that don’t meet the above requirements. Lending Club reserves the right to modify or discontinue this offer at any time.
5 Sources: SIFMA, U.S. Bond Market Issuance and Outstanding as of 9/2015. Board of Governors of the Federal Reserve System, "Consumer Credit - G.19" as of 12/2015. Bond market yields as of 9/2015 from Barclays and S&P. Consumer credit differs from other fixed income sectors in many ways. Some factors include: liquidity, transaction costs, methods of accessing the asset class, risk characteristics, and whether or not the instrument is collateralized.
6 As of 12/31/15. Net return on an average portfolio of Lending Club Loans measured as median adjusted Net Annualized Return for investors with 100+ Notes, Note concentration of < 2.5% of portfolio value, all loan grades, and portfolio age of 12-18 months. Barclays index data sourced from Barclays Live; represents trailing 12-month return. Index returns are for illustrative purposes only. Index performance does not reflect any fees or other expenses. One cannot invest directly in an index. Historical returns are not a promise of future results. Lending Club Notes are not insured or guaranteed and investors may have negative returns. Individual portfolio results may be impacted by, among other things, the size and diversity of the portfolio, exposure to any single Note, borrower or group of Notes or borrowers, as well as macroeconomic conditions.
7 Millennium Trust Company, LLC ("Millennium") is an independent Illinois trust company. Millennium is based in Oak Brook, IL and is not affiliated with Lending Club. Millennium has no role in the original issuance of the Notes and is not responsible for and does not approve, endorse, review, recommend or guarantee the Notes or the accuracy, reliability, or completeness of any data or information about the Notes. More information about Millennium is available at www.mtrustcompany.com.
The content on the following page is intended for registered investment advisors only.
If you're an individual investor, please visit our homepage.
If you're an institutional investor, please visit our institutional investor page.