LendingClub Said in Talks With Citigroup for Loan Financingby
Bank could buy loans or arrange financing for others to do so
Citgroup says it’s ‘productively engaged’ with LendingClub
LendingClub Corp., the online loan platform looking to restore investor confidence, is in talks with Citigroup Inc. to arrange more funding for the debts it arranges, according to a person with knowledge of the matter.
Citigroup may buy loans or provide financing for others to do so, according to the person, who asked not to be identified discussing the private negotiations. The Wall Street Journal reported the potential deal earlier on Thursday.
Buyers of LendingClub’s loans pulled back after the surprise resignation of the company’s founder and chief executive officer, Renaud Laplanche, this month. An internal LendingClub review found some debts were misdated and that Laplanche, 45, failed to properly disclose an investment. The company has been working with Jefferies Group to line up more purchasers for the loans since then, a person familiar with the matter said last week.
“We are productively engaged with LendingClub on a number of fronts,” a spokeswoman for Citigroup said in an e-mailed statement, while declining to comment on any arrangement or terms.
LendingClub has slid 38 percent in New York trading since its leadership shakeup, closing at $4.37 on Thursday.