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Author Topic: Recovery rate

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  • Posts: 3
Recovery rate
OP: March 19, 2020, 11:00:00 PM
Hi everyone,
Is correct to assess Recovery rate on Lending Club chargedoff loans in this way:
(recoveries-collections)/(loan_amount-total_rec_principal)
or It is more appropriate to this calculation:
total_rec_principal+recoveries/ loan_amount

Any suggestion?
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  • Posts: 300
Recovery rate
#1: March 20, 2020, 11:00:00 PM
Define recovery rate and you will get your answer. Net Recoveries / Remaining Principal makes better sense as Recovery Rate of Charged Off loans as you are using only data since charge off.
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