Cross River Bank announces $250M securitization backed by Upstart personal loans

Cross River Bank on Friday, Oct. 20, said it originated its first broadly syndicated securitization, CRB 2023-1, backed by $250 million of personal loans originated by the bank through the Upstart platform. The milestone marks a significant step forward for Cross River in the world of asset-backed securities and underscores its commitment to providing innovative capital solutions.

“Bringing CRB 2023-1 to market establishes a new funding channel for the bank, allowing us to independently secure asset-backed financing for our retained loan portfolios,” Ryan Callahan, co-head of capital markets at Cross River, said. “While this securitization only includes loans aggregated through the Upstart platform, we plan to become a regular securitization issuer, leveraging the infrastructure we built here for assets the bank originates and retains.”

Fort Lee-based Cross River said this is the first securitization of personal loans originated by a partner bank through a marketplace lending platform to achieve a AAA rating by one of the three major rating agencies, S&P, on the senior tranche of offered notes. Cross River is acting as the sponsor and sole seller, and will hold the customary vertical 5% risk retention to satisfy U.S. credit risk retention guidelines.

“Obtaining a AAA rating (from S&P) on the senior security issued by CRB 2023-1 creates additional liquidity for the personal loan asset type, bringing in pockets of capital that may have otherwise been sitting on the sidelines.” Callahan said. “It affirms our dedication to delivering tailored solutions that propel the fintech ecosystem.”

Cross River is the named servicer on the transaction, with Upstart acting as subservicer. Goldman Sachs & Co. LLC served as initial purchaser and structuring agent with Barclays Capital Inc. and CRB Securities LLC — each serving as initial purchaser and joint bookrunner.