Figure 1 reports the timeline of changes to the Prosper lending platform. These events and their respective dates are reported in the table below.
Dec 19, 2010:
Change from auction to posted interest rate
Jan 13, 2010:
First interest rate change
Feb 16, 2011:
Second interest rate change
March 4, 2011:
Third interest rate change. Introduction of shorter and longer maturity loans: 12 months maturity for C, D and E rating groups
April 14, 2011:
Fourth Interest rate change
Figure 2 includes six panels, one for each credit grade. Each panel depicts a histogram of the listed and funded interest rates faced by borrowers in a given credit grade: top-left depicts AA grade, top-right depicts A grade, middle-left depicts B grade, middle-left depicts C grade, bottom-left depicts D grade, and bottom-right depicts E grade. The start rate is the reserve rate listed by the borrower and is plotted in black. The funded rate is the rate at which the loan is actually issued and is depicted in light blue. The Y axis denotes the density. Credit grades are assigned by Prosper based on proprietary analysis. The period begins on June 1, 2010 and ends on the last day of auction pricing. Listings are restricted to 3-year loans for borrowers that do not have a prior loan with the platform.
Figure 3 includes six panels, one for each credit grade (similar to figure 2 above). Each panel depicts a scatter plot of the average 2-day interest rate listed by borrowers in a given credit grade: top-left depicts AA grade, top-right depicts A grade, middle-left depicts B grade, middle-left depicts C grade, bottom-left depicts D grade, and bottom-right depicts E grade. Credit grades are assigned by Prosper based on proprietary analysis. The x-axis measures the number of filing dates relative to the date on which the auction was eliminated (December 19, 2010). Each dot represents a 2-day average. During the auction period, the rates shown are the starting rate for the auction. Listings are restricted to 3-year loans for borrowers that do not have a prior loan with the platform.
Figure 4 includes six panels, one for each credit grade (similar to figures 2 and 3 above). Each panel depicts a scatter plot of the number of listings by borrowers in a given credit grade: top-left depicts AA grade, top-right depicts A grade, middle-left depicts B grade, middle-left depicts C grade, bottom-left depicts D grade, and bottom-right depicts E grade. Credit grades are assigned by Prosper based on proprietary analysis. The x-axis measures the number of filing dates relative to the date on which the auction was eliminated (December 19, 2010). Each dot represents the average daily number of listings for a 2-day period. Listings are restricted to 3-year loans for borrowers that do not have a prior loan with the platform
Figure 5 includes six panels, one for each credit grade (similar to figures 2-4 above). Each graph depicts the average credit experience of borrowers listing in a given credit grade: top-left depicts AA grade, top-right depicts A grade, middle-left depicts B grade, middle-left depicts C grade, bottom-left depicts D grade, and bottom-right depicts E grade. Credit experience is defined as the number of years since the first credit line. Credit grades are assigned by Prosper based on proprietary analysis. The x-axis measures the number of filing dates relative to the date on which the auction was eliminated (December 19, 2010). Each dot represents a 2-day average. Listings are restricted to 3-year loans for borrowers that do not have a prior loan with the platform.