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♪♪♪

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LendingClub has announced it's
buying Radius Bank

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in what would be the first
fintech takeover of a regulated
U.S. bank.

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The online lending marketplace
is paying $185,000,000

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for the Boston-based digital
bank which has about

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$1,400,000,000 in assets.

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LendingClub's CEO Scott Sanborn

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says the deal will allow the
company to

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reimagine banking in a way that
is free from legacy practices
and systems

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The acquisition gives
LendingClub a less-expensive
form of funding for its loans

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and regulatory clarity
through a direct relationship
with a primary regulator

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Regulatory issues have dogged
LendingClub for years.

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The online lender's faced harsh
criticism over its assertion
that its long-standing
relationship with

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the FDIC-insured WebBank exempts it from
state-lending laws.

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There have been numerous
lawsuits and just last month,

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LendingClub settled with the
Massachusetts Attorney General

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over allegations it charged
excessive interest rates to
borrowers in violation

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of state law. As part of the
settlement, LendingClub

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agreed to stop making small
loans to borrowers that exceed
the state's cap.

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deBanked's Chief Editor
Sean Murray says that

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"Acquiring Radius Bank will
presumably mean that the

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company will enjoy some level
of immunity to similar charges
in the future and that

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LendingClub will genuinely be
free to enjoy the benefits and
protections of a chartered bank."

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LendingClub says it expects
federal regulators will approve
the deal and that it will

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close in 12 to 15 months.

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I'm Kayla Ayres, and this is
deBanked News.

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♪♪♪