September 16, 2016

Prosper Performance Update: August 2016

By Brad Pennington

Today I am proud to share the Prosper Performance Update for August 2016. As you will see in the Update, estimated returns on the August production continue to be slightly above 7% on average.*

The Update also shows that the 2016 portfolio is on track to have the highest Internal Rate of Return (IRR) target since 2013 and the highest average FICO to date. We believe this is a result of policy interventions made throughout 2016. Prosper also believes that these ongoing policy improvements will positively impact delinquency in the new 2016 vintages.

Other portfolio highlights for the month ending August 31, 2016 include:

  • Delinquency rates for the 2015 vintages remain elevated in comparison to 2013 and 2014 vintages. Prosper is closely attuned to delinquency trends and will continue to update investors as it becomes aware of material changes to delinquency trends.
  • All delinquency and loss patterns since 2013 remain well below the loss and delinquency levels experienced in 2012. The lower level of risk is attributed to changes made to Prosper’s credit risk program at the end of 2012. Today, early delinquency continues to be a crucial input as future policy and pricing changes for the portfolio are assessed.
  • Cumulative gross charge-offs remain above 2013 trend, which we believe are a result of environmental changes observed in the broad consumer credit market at the end of 2015.
  • Pre-payment patterns remain relatively stable with vintages from 2015 and 2016 tracking the early pre-payment patterns of the 2013 vintage more closely than that of the 2014 vintage.

It is important to note that in addition to continued policy improvements, Prosper has released major product enhancements to improve the speed of investor deployment on our platform. We believe these changes will in turn enhance realized returns.  Please feel free to reach out to us for further details.

More portfolio insights and key charts can be found in the full report.

The Prosper Performance Updates are designed to help our investor community better understand performance trends and to provide them with the information and tools needed to invest through the Prosper platform.

If you wish to subscribe to the performance update email list, please sign up here.

 

IMPORTANT CORRECTION NOTICE: The monthly originations summary data was updated on September 20, 2016. If you have any questions, please feel free to reach out to David Staley ([email protected]) or Ben Croes ([email protected]).

* Estimated return is calculated by taking the WA Eff. Yield and subtracting the WA Loss. Individual results may vary and estimates can change. Actual performance may differ from estimated performance, and the information presented is not intended to be investment advice or a guarantee of the performance of any Note or loan.

The data, statements and figures in this post are based on Prosper’s analysis and calculations which, in turn, are based on various data sources compiled and analyzed by Prosper with all reasonable care to ensure they contain no omission likely to affect their import. Neither the analysis nor the underlying data sources have been verified by an independent third party.

This post includes forward-looking statements. Forward-looking statements inherently involve many risks and uncertainties that could cause actual results to differ materially from those projected in these statements. Where, in any forward-looking statement, we express an expectation or belief as to future results or events, such expectation or belief is based on the current plans and expectations of our management and is expressed in good faith and believed to have a reasonable basis, but there can be no assurance that the expectation or belief will result or be achieved or accomplished. All forward-looking statements speak only as of the date of this post and are expressly qualified in their entirety by the cautionary statements above. We undertake no obligation to update or revise forward-looking statements that may be made in this post to reflect events or circumstances that arise after the date made or to reflect the occurrence of unanticipated events.

All personal loans are made by WebBank, a Utah-chartered Industrial Bank, Member FDIC. All personal loans through Prosper are unsecured, fully amortized personal loans. Neither Prosper Funding LLC nor Prosper Marketplace, Inc. are registered as an investment adviser with any federal or state regulatory agency. The information contained in this presentation is for informational purposes, and should not be construed as individually tailored investment advice or as a recommendation with respect to any security or investment approach. This presentation has been prepared without regard to the circumstances and objectives of its participants and should not be relied upon as authoritative or taken in substitution for the exercise of judgment by any individual.  Each individual should consider the appropriateness of any investment decision having regard to his or her own circumstances, the full range of information available and appropriate professional advice. Prosper Funding LLC and Prosper Marketplace, Inc. recommend that each individual seek independent investment and financial advice concerning any services or investments discussed in this presentation.