Prosper Marketplace has updated investors on their estimated returns for the month of September. According to the online lender, returns are just above 7% – a slight drop of 14 bps from August.
Prosper said this number was impacted by:
- a slightly lower percentage of five-year loans that were originated in the period; and
- a higher percentage of B and above loan grades in the period.
Also, FICO was trending higher by 10 points in comparison to early 2016, indicative of a more conservative approach.
Prosper also stated that prepayments ticked up for originations in Q1 and Q2 of 2016. Q2 2015 delinquency rates “appears to be improving”. But Prosper also added;
“We believe the trend in early delinquency for the Q4 2015 vintage is a byproduct of borrowers increasingly selecting manual pay vs. automatic monthly ACH and we expect this trend to continue to impact early delinquency throughout the remainder of 2016.”
Cumulative gross charge-offs continue to trend above 2013 levels, which Prosper believes is a result of the current consumer credit environment, which is improving at a slower pace than it had throughout 2013-2014.nt
