CreditEase, a Beijing-based wealth manager and owner of a peer-to-peer lender in China, has committed to buy consumer loans made by Internet lenders including Prosper Marketplace Inc. and Avant Inc.
CreditEase has raised an $80 million fund with plans to buy $50 million of loans from Prosper and Avant, according to Lend Academy, a blog that focuses on online lenders. CreditEase would be the first Chinese offshore fund to invest in unsecured personal loans made to Western borrowers, according to Peter Renton, founder of the blog.
The CreditEase transaction "speaks to the significant appeal globally of the U.S. middle-income consumer," Avant spokeswoman Carolyn Blackman said in an e-mail. Privately held Avant, which has backing from Balyasny Asset Management and Tiger Global Management LLC, specializes in unsecured loans to subprime borrowers. The loan sales with CreditEase will be Avant’s first to an institutional investor in Asia, and will help diversify the lenders’ sources of capital, said Blackman. She declined to provide any additional details regarding terms of the agreement.
Sarah Cain, a spokeswoman for privately held Prosper, confirmed the accuracy of the Lend Academy blog post, and declined further comment. CreditEase didn’t answer its general line and the company didn’t respond to an e-mail seeking comment.
CreditEase is the majority owner of Chinese peer-to-peer lender Yirendai Ltd., whose shares have risen 74 percent this year. The lender listed on the New York Stock Exchange late last year.
Slowing growth in China is spurring investors to pour more money into foreign countries including the U.S. Chinese investors could increase their investments in the U.S. this year to $30 billion, up from more than $15 billion in 2015, according to a report by the National Committee on U.S.-China Relations and Rhodium Group.