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KBRA Provides Preliminary Ratings to Prosper Marketplace Issuance Trust, Series 2018-2

By on March 11, 2021 0

NEW YORK–() – Kroll Bond Rating Agency (KBRA) assigns preliminary ratings to three categories of notes issued by Prosper Marketplace Lending Issuance Trust 2018-2 (“PMIT 2018-2”). This is a $ 500.5 million consumer loan ABS transaction.

This transaction represents the tenth securitization secured by unsecured consumer loans issued through the online market lending platform operated by Prosper Funding LLC (“Prosper” or the “Company”).

Founded in 2005, Prosper operates an online market lending platform (www.prosper.com) (the “Prosper Platform” or the “Platform”), where personal installment loans are offered to privileged and near-privileged clients. The PMIT 2018-2 loans were all taken out as standard product loans under the WebBank and Prosper credit guidelines. Loans on the platform are issued by WebBank, a chartered industrial bank in Utah. The Prosper platform offers fully amortizing fixed rate unsecured consumer loans ranging from $ 2,000 to $ 40,000 for terms of three years and five years. A set-up fee of 1% to 5% is charged to the borrower depending on his risk profile and the duration of the loan. Since its inception, the Prosper platform has facilitated the origination of over one million loans with a total balance of $ 13 billion.

The transaction has initial credit enhancement levels of 39.50% for Class A Notes, 28.60% for Class B Notes and 9.50% for Class C Notes. The Credit Enhancement consists of excess margin, overcollateralisation, subordination (in the case of Class A and Class B Notes) and a funded reserve account at closing.

KBRA applied its Global Consumer Loan ABS methodology as part of its analysis of the underlying collateral pool of the transaction, the proposed capital structure and historical gross loss data from the Prosper platform. In addition, KBRA also conducted an operational assessment of the Prosper platform. KBRA will also review the operational agreements and legal opinions of the transaction prior to closing.

Preliminary Ratings: Prosper Marketplace Issuance Trust, Series 2018-2

Classify

Preliminary assessment

Principal of the initial class

A

A + (sf)

$ 335,500,000

B

BBB (sf)

$ 59,950,000

VS

B + (sf)

$ 105,050,000

Declaration and Disclosure of Warranties

All nationally recognized statistical rating agencies are required, in accordance with SEC Rule 17g-7, to provide a description of the representations, warranties and mechanisms for executing a transaction that are available to investors. when issuing credit ratings. KBRA’s disclosure for this transaction can be found in the available report here.

Related publications: (available at www.kbra.com)

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About KBRA and KBRA Europe

KBRA is a full-service credit rating agency registered with the United States Securities and Exchange Commission as an NRSRO. In addition, KBRA is designated as a designated rating agency by the Ontario Securities Commission for issuers of asset-backed securities to file a simplified prospectus or a shelf prospectus, is recognized by the National Association of Insurance Commissioners in as a credit rating provider, and is a credit rating agency (CRA) certified by the European Securities and Markets Authority (ESMA). Kroll Bond Rating Agency Europe Limited is registered with ESMA as a rating agency.

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