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Actionable news in LC: LENDINGCLUB CORPORATION,

Online lenders upbeat about turnaround progress, but worries linger

NEW YORK (Reuters) - LendingClub Corp (LC.N) and OnDeck Capital Inc (ONDK.N) surprised investors on Monday with strong growth forecasts that sent the online lenders' stocks soaring, but analysts said the sector's health was still a concern.

Online lenders soared in popularity after the financial crisis when banks pulled back from traditional lending and borrowers sought other options. But rising delinquencies have made it harder to raise funds for fresh loans, prompting the sector to review its business model, which tends to attract borrowers with low credit quality.

LendingClub, which serves individuals, and OnDeck, which caters to small businesses, are cutting costs and trying to attract borrowers with better credit.

Executives of both companies were upbeat about the progress in their turnaround plans after they reported second-quarter results.

"It's great to be back to growth," LendingClub Chief Executive Scott Sanborn...


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