LendingClub trust notes receive Fitch ratings for 2026 securitization

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LendingClub Fitch ratings 2026

Highlights

LendingClub Rated Notes Issuer Trust, Series 2026-P4 received Fitch Ratings from AAAsf (senior) to Bsf (junior) on six note classes.
The securitization pool comprises 65.13% P1 and 34.87% P2 prime loans, with a weighted average FICO of 735 and 11.23% weighted average interest rate.
Fitch notes improving prime loan default rates and strong collateral quality support ratings, but rising defaults or weaker recoveries could pressure notes' ratings.

Prime loan pool and assigned ratings

As reported by Fitch Ratings, LendingClub Rated Notes Issuer Trust, Series 2026-P4 has received ratings and Rating Outlooks for six note classes, with the top tranche rated AAAsf and lower classes descending through AAsf, Asf, BBBsf, BBsf and Bsf.

The agency says the securitization pool is made up بالكامل of prime loans, split between P1 loans at 65.13% and P2 loans at 34.87%. Fitch says the pool carries a weighted average FICO score of 735, while 16.14% of the loans have FICO scores below 700 and the minimum FICO in the pool is 662.

Fitch also points to a weighted average debt-to-income ratio of 18.96%, a weighted average interest rate of 11.23% and a weighted average remaining term of 51.92 months. The loans have little seasoning, which means the collateral largely reflects recent origination quality.

Credit support and performance implications

Fitch says LendingClub's approved default rates in its prime loan portfolio are starting to improve after corrective measures taken in 2021 and 2022. That trend supports the ratings, alongside what the agency describes as strong receivable quality and adequate servicing capabilities built on LendingClub's consumer loan servicing history since 2007.

Credit enhancement for the transaction comes from overcollateralization and subordination for the senior tranche. Fitch says it applies a AAAsf stress equal to 4.25 times the base-case default rate for prime loans when assessing the structure's ability to absorb stressed losses.

The agency adds that downside rating pressure could emerge if defaults rise or recoveries weaken, while lower default levels could support positive rating adjustments. Fitch also says ESG factors have only minimal credit impact in this transaction, and notes that due diligence information provided by PricewaterhouseCoopers LLP was considered in its analysis without changing its conclusions.

Our earlier coverage of Fitch’s ratings on Small Business Origination Loan Trust 2026-1 DAC looked at a securitisation backed by a static pool of mostly unsecured UK SME loans originated via Funding Circle. We outlined Fitch’s views on portfolio risk—especially default and recovery assumptions—and the deal’s structural features, including a pro rata amortisation period that can increase sensitivity until a sequential-pay trigger is breached.

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