2023-05-15 16:43:34 ET
Upstart Holdings ( NASDAQ: UPST ) stocks surged 23.6% on Monday after the AI-powered lending marketplace inked a deal to sell up to $4B of consumer installment loans to private credit shop Castlelake.
The move comes after Upstart ( UPST ) finance chief Sanjay Datta said last week that it secured more than $2B in funding agreements during Q1 that will "provide us with a stronger and more resilient capital supply over the coming quarters."
The purchase deal with Castlelake along with co-investor Eltura Capital Management consists of the acquisition of a back book of loans and a forward flow arrangement, in a move that takes a great number of loans off Upstart's ( UPST ) balance sheet and thus gives the company more capacity to make new loans.
"Castlelake's support will help ensure we have the resources to continue scaling the deployment of our AI models and expanding access to affordable credit for all consumers," Datta said in a statement.
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Why did Upstart stock soar today? Fintech sells up to $4B of consumer loans