Oportun Sells $228 million of loans through Amortizing Asset-Backed Securitization

Rhea-AI Summary

Oportun (Nasdaq: OPRT) announced a sale of $228 million in loans through amortizing asset-backed notes, part of a $400 million total issuance. The transaction features loans secured by personal installment loans and achieved a yield of 6.75% on Oportun's share. Priced at a fixed interest rate of 3.83% per annum, the notes received favorable ratings from DBRS and Kroll. This strategic move allows Oportun to generate capital while reducing credit exposure. Oportun has provided over $12 billion in credit to its members since its inception.

Positive

• Sale of $228 million in loans enhances capital generation.
• Transaction achieved an attractive all-in yield of 6.75%.
• Fixed interest rate of 3.83% is competitive.
• Strong ratings assigned to the notes by rating agencies.

Negative

• None.

SAN CARLOS, Calif., April 04, 2022 (GLOBE NEWSWIRE) -- Oportun (Nasdaq: OPRT), a mission-driven fintech and digital banking platform, today announced the sale of $228 million of loans through the issuance of amortizing asset-backed notes secured by a pool of its unsecured and secured personal installment loans. Oportun and funds managed by Ellington Management Group both contributed collateral and were co-sponsors of the transaction, which totaled $400 million in issued asset-backed notes. The notes were priced with a weighted average fixed interest rate of 3.83% per annum. Oportun also sold its share of the residual interest in the pool. By selling both its notes and residual interest, Oportun achieved a sale of loans at an all-in yield of 6.75% on its portion of the transaction.

“We are excited about this transaction because the structure allowed us to sell our loans at an attractive price while generating capital and reducing our credit exposure,” said Jonathan Coblentz, Oportun’s Chief Financial Officer & Chief Administrative Officer.

The offering included three classes of fixed rate notes: Class A, Class B, and Class C notes. DBRS, Inc. rated all classes of notes, assigning ratings of AA (low) (sf), A (low) (sf) and BBB (low) (sf), respectively. Kroll Bond Rating Agency, LLC rated the Class A and Class B notes, assigning ratings of A (sf) and BBB (sf), respectively. The notes were placed with a diversified mix of institutional investors in a private offering pursuant to Rule 144A under the Securities Act of 1933, as amended. Goldman Sachs & Co. LLC acted as sole book-runner.

About Oportun
Oportun (Nasdaq: OPRT) is an A.I.-powered digital banking platform that seeks to make financial health effortless for anyone. Driven by a mission to provide inclusive and affordable financial services, Oportun helps its nearly 1.5 million hardworking members meet their daily borrowing, savings, banking, and investing needs. Since inception, Oportun has provided more than $12 billion in responsible and affordable credit, saved its members more than $2 billion in interest and fees, and automatically helped members set aside more than $7.2 billion for rainy days and other needs. In recognition of its responsibly designed products, Oportun has been certified as a Community Development Financial Institution (CDFI) since 2009.

Investor Contact
Nils Erdmann
650-810-9074
ir@oportun.com 

Media Contact
Usher Lieberman
650-769-9414
usher.lieberman@oportun.com 

FAQ

What was the loan sale amount announced by Oportun on April 4, 2022?

Oportun announced the sale of $228 million in loans.

What was the total amount of asset-backed notes issued by Oportun?

The total amount of asset-backed notes issued was $400 million.

What yield did Oportun achieve from its portion of the loan sale?

Oportun achieved an all-in yield of 6.75% on its portion of the transaction.

What interest rate was applied to the notes sold by Oportun?

The notes were priced with a fixed interest rate of 3.83% per annum.

Which agencies rated the asset-backed notes issued by Oportun?

DBRS and Kroll Bond Rating Agency rated the asset-backed notes.