LendingClub, under pressure to bolster investor confidence in the loans it arranges online, is boosting interest rates and tightening criteria for borrowers to qualify.
Interest rates will increase by a weighted average of 55 basis points, the company said Tuesday in a regulatory filing, minutes before it was to start its annual shareholder meeting. The San Francisco-based firm also lowered the ratio of debt-to-income that it allows applicants to have.
Acting Chief Executive Officer Scott Sanborn is trying to shore up investor confidence hurt by last month's announcement that a botched loans sale and disclosure lapses prompted the resignation of founder Renaud Laplanche. That exacerbated a slide in the firm's stock over the past year amid concerns that it might struggle to lure investors necessary to extend its rapid growth.