Kroll Bond Rating Agency Assigns Preliminary Ratings to SoFi Consumer Loan Program 2017-2

NEW YORK--(BUSINESS WIRE)-- Kroll Bond Rating Agency (KBRA) assigns preliminary ratings to two classes of notes issued by SoFi Consumer Loan Program 2017-2 LLC (“SCLP 2017-2”). This is a $343.7 million consumer loan ABS transaction that is closing on February 26, 2017.

This transaction represents SoFi Lending Corp.’s (“SoFi” or the “Company”) eighth rated securitization collateralized by a portfolio of unsecured consumer loans. SoFi currently originates personal loans through its state licenses or complies with certain requirements where a state lending license is not required.

Founded in 2011, SoFi is located in San Francisco, California and operates an online lending platform. Personal installment loans are offered to prime consumers through SoFi’s platform. Typical borrowers with loans securitized in this collateral pool, have a weighted average annual income of approximately $141,633, a weighted average credit score of 730 and a weighted average monthly free cash flow of $5,184. Loans typically have an original term between 36–84 months, an original balance ranging in size from $5,000 to $100,000 with fixed rates or variable rates depending on the borrower’s risk profile and loan term. Borrowers are not charged an origination fee or any prepayment penalties on the loans. As of December 31, 2016, SoFi had originated approximately $3.7 billion in personal loans to roughly 120,000 different prime quality borrowers.

SoFi finances loans on its balance sheet through its $1.7 billion multi-year warehouse capacity, through whole loan sales and retains a 5% residual interest in the securitizations by owning a portion of the Certificates.

Initial credit enhancement levels are 22.96% for the Class A Notes and 13.73% for the Class B Notes. Credit enhancement consists of overcollateralization, subordination (in the case of the Class A Notes), excess spread and a reserve account funded at closing.

KBRA applied its General Rating Methodology for Asset-Backed Securities as part of its analysis of the transaction’s underlying collateral pool, the proposed capital structure and SoFi’s historical gross loss data. KBRA also conducted an operational assessment of the SoFi’s Platform, as well as a review of the transaction’s legal structure and transaction documents. KBRA will review the operative agreements and legal opinions for the transaction prior to closing.

For complete details on the analysis, please see KBRA’s Pre-Sale Report, SoFi Consumer Loan Program 2017-2 Pre-Sale Report, which was published today at www.kbra.com.

Preliminary Ratings Assigned: SoFi Consumer Loans Program 2017-2

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KBRA is registered with the U.S. Securities and Exchange Commission as a Nationally Recognized Statistical Rating Organization (NRSRO). In addition, KBRA is recognized by the National Association of Insurance Commissioners (NAIC) as a Credit Rating Provider (CRP).

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Analytical Contacts:

Kroll Bond Rating Agency

Eric Neglia, Senior Director

[email protected], (646) 731-2456

or

Rosemary Kelley, Managing Director

[email protected], (646) 731-2337

or

Jenny Ovalle, Associate Director

[email protected], (646) 731-2309

or

Charlene Davis, Director

[email protected], (646) 731-2439

Source: Kroll Bond Rating Agency