NEW YORK, June 25, 2015 /PRNewswire/ -- CommonBond, a leading marketplace lending platform that lowers the cost of student loans for borrowers and provides financial returns to investors, today announced it has closed its inaugural securitization of graduate student loans.
With an investment-grade rating from Moody's of 'Baa2' and DBRS of 'A (high),' the company securitized approximately $100 million of student loan assets. Purchasers included insurance companies, money managers, banks, asset managers and hedge funds. This transaction marks the first time Moody's has issued an investment-grade rating for a first-time-issuing marketplace lending platform.
"This is a major milestone for CommonBond that reflects the quality of our underwriting, the strength of our team, and the scale of our platform," said David Klein, CEO and Co-Founder of CommonBond. "This securitization has meaningfully expanded our investor base among top institutions and money managers, and further positions us to meet and exceed our growth objectives over the coming months and years."
Morgan Stanley served as lead underwriter and sole manager for the transaction. White Pine Advisors served as advisor. CommonBond serves more than 2,000 credit-worthy borrowers and has yet to experience a default, or a 30-day delinquency, among its borrowers. CommonBond's inaugural securitization follows a strong year of growth for the company.
In February, the company announced a partnership with Nelnet, one of the nation's leading education planning and financing companies, in which Nelnet committed to purchasing at least $150 million of loans on the CommonBond platform. Nelnet also made an equity investment in the company. At the same time, CommonBond expanded its student loan refinancing options to more than 700 graduate degree programs. To date, CommonBond has funded $200 million in loans.
CommonBond is a leading marketplace lending platform that lowers the cost of student loans for borrowers and provides financial returns to investors. Started by three Wharton MBAs, CommonBond is dedicated to delivering best-in-class student loan options with competitive pricing, a simple tech-enabled experience and exceptional customer service that is empowered to help borrowers. To date, CommonBond has funded and refinanced more than $200 million in graduate student loans. The company saves borrowers more than $10,000, on average, over the life of the loan. CommonBond is the first company to bring the "one-for-one" social model to finance: For every degree fully funded on the company's platform, CommonBond funds the education of a student in need for a full year, through a partnership with Pencils of Promise. For more information, visit https://www.commonbond.co/.