How does LC set the base interest rate (currently 5.05%:
https://www.lendingclub.com/public/how-we-set-interest-rates.action)?Wouldn't a lower base rate increase the number of borrowers vs lenders and potentially increase LC's profits (more origination fees - provided that all loans still get funded of course)?
See my blog post from last year
http://andirog.blogspot.com/2012/06/lending-club-base-interest-rate-excess.html. Also, you will find info in one of the older LC SEC filings.