The head of loanDepot Inc. has provided insight into the decision to hold off on the mortgage lender’s initial public offering.
The Foothill Ranch, California-based mortgage banking firm originally disclosed its plans for an IPO in
early October.
But
a week ago, loanDepot reported that it was withdrawing its plans for an IPO at this time because of market conditions.
In a posting on a company blog, loanDepot Chairman and Chief Executive Officer Anthony Hsieh explained the decision to put the IPO on hold.
He noted that his company has
surpassed the $1 billion dollar valuation and is one of the few success stories not from Silicon Valley.
“The surfer crowd from SoCal can compete with the Silicon Valley hoodie crowd thanks to our 5,000+ dedicated team members throughout the country,” Hsieh said.
He cited a two alternative lending companies, Lending Club and OnDeck, which are trading down from their IPO prices since going public during the past 12 months.
Hsieh also highlighted how
Albertsons, Neiman Marcus and Digicel have all put IPOs on hold.
“We did a fantastic job and continue to build our franchise, even though timing in the IPO market isn’t right,” he wrote. “loanDepot has many options as a successful profit-generating company, and the pursuit of an IPO was one option to accelerate our plans for growth that were already in progress. Unlike other IPO candidates, we’re already moving forward with our plans because of our capital reserves and the investor confidence we’ve earned beyond the IPO market. And while an IPO continues to be an option, perhaps one day in the future, it’s not a necessity.”
