OnDeck Australia Establishes A$75m Funding Line with Credit Suisse
(26 July 2018 - Australia) OnDeck Australia has secured a A$75 million funding line from Credit Suisse, marking the latest Fintech partnership with an established incumbent financial institution.
The subsidiary of the US based parent OnDeck Capital stated that the asset-backed revolving credit facility is due to mature in June 2020 and would be used to refinance OnDeck Australia's loan book and fund new loans. OnDeck is a Fintech company that provides financing for small businesses in Australia and is part of the OnDeck Group which has loaned over A$8 billion to 80,000 small business owners across the US, Canada and Australia. Ashurst advised OnDeck Australia in establishing the securitisation warehouse provided by Credit Suisse and backed by OnDeck's business loans asset portfolio.
OnDeck Capital floated on the New York Stock Exchange (NYSE) in January 2015 (NYSE: ONDK) but is currently trading 70 percent below its IPO price as the group and other small business lenders face difficulties achieving profitability. Notably ONDK shares have improved by 28 percent in 2018 and the group has a market capitalisation of US$540 million. OnDeck CEO Noah Breslow confirmed the group was achieving strong growth rates in international markets with OnDeck Canada also announcing a funding arrangement similar to the Australian operation. French bank Credit Agricole will provide $50 million of funding with half the funds fully committed and half available to draw by lenders at their discretion.
“OnDeck is striving to lower its cost of funding, origination and to build a ‘leading credit model’ and the online small business lending market is growing at a faster pace than it did in the US at a similar stage in its development” stated OnDeck Australia Managing Director Cameron Poolman.
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