[CreditGuy]

A single lender doing this and the massively complex securitization and derivatives markets surrounding the housing bubble are entirely different animals. If you think they are, please show your work.

[staten]

A single lender doing this and the massively complex securitization and derivatives markets surrounding the housing bubble are entirely different animals. If you think they are, please show your work.

Nope. They wouldn't care. Default rate consistent between 8-10% check. % of merchants on payment plan consistent. check. Relative dollar amount on payment plans consistent. check.

An auditor might call BS on a $1 payment plan. If I was the CEO I would argue good faith, if I was the auditor I would add up the exposure and see if material.

I've been a big 4 auditor, I've been an institutional investor at one of these so called sophisticated banks and for better or worse I have extensive experience in MCA.

Ondk's portfolio performance is fine (yes-despite the fact they are doing some extremely aggressive deals AND being stacked on left and right).

It's the operating performance that is the problem. They spent 100s of millions of dollars building out an origination capability. Now they want to be a software service company? Note that the Chase deal is not past the "parameters" stage.

Lack of direction, lack of cohesive strategy. Taking in the bad debt provision by 20% is very unsophisticated. As a CFO, you always have reserves to pull from so if you want smooth earnings its not in your face. This was an in your face reduction to boost earnings. Had to be a factor in the sell off.

Having said all of this. The Ondk mgt team did a simply amazing job of raising capital, scaling the company and creating a liquidity event for early investors. I wouldn't underestimate their ability to learn and adapt.........just not on my dime