TORONTO, Dec. 10, 2015 /CNW/ - CHIP Mortgage Trust ("CMT" or the "Trust") announced that it will redeem $100,000,000 principal amount of Series 2011-1 senior medium term notes (the "Notes"), on a pro-rata basis, on January 5, 2016. The redemption price will be $101,922,934.25, which includes accrued and unpaid interest to the Early Redemption Date. Further notice(s) may be issued to redeem the remaining $51,700,000 principal of the Notes prior to the expected final payment date of February 1, 2016.
The funds used to redeem the Notes were sourced from a combination of cash flow generated in the normal course of business, and from the issuance of Guaranteed Investment Certificates ("GICs") by HomEquity Bank. HomEquity Bank has increased the diversification of its sources of funding, adding three major distribution relationships in the last 12 months.
"We are extremely satisfied with our ability to redeem the Notes early," said Steven Ranson, President and Chief Executive Officer. "HomEquity Bank's access to funds through the issuance of GICs has significantly enhanced our liquidity management capabilities, and has provided additional financial flexibility in our funding operations."
Forward Looking Statements
CMT from time to time makes written and verbal forward-looking statements about business objectives, operations, performance, and financial condition, including, in particular, forecasted mortgage origination growth, as well as the likelihood of its success in developing and expanding its business. Forward–looking statements are typically identified by words such as "will", "should", "believe", "expect", "forecast", "anticipate", "intend", "estimate", "plan", "may" and "could". These statements may be included in CMT's annual and quarterly reports, regulatory filings, press releases, presentations and other communications. These forward-looking statements are based upon a number of assumptions and estimates that are inherently subject to significant uncertainties and contingencies, many of which are beyond the control of CMT. The uncertainties and contingencies include, but are not limited to, risks related to capital markets and additional funding requirements, credit and underwriting risk, fluctuating interest rates, asset quality and rates of default as well as those factors discussed in the documents filed on SEDAR. Actual results may differ materially from those expressed or implied by such forward-looking statements. CMT does not undertake to update any forward-looking statement, whether written or verbal, that may be made from time to time, except as required under applicable securities legislation.
About CHIP Mortgage Trust
CMT is a wholly owned subsidiary of HomEquity Bank. HomEquity Bank is a Schedule 1 Canadian bank and is the only national provider of reverse mortgages to homeowners aged 55 and over, Canada's fastest growing demographic segment. HomEquity Bank originates and administers Canada's largest portfolio of reverse mortgages under the CHIP Reverse Mortgage ™ and Income Advantage ™ brands. HomEquity Bank has been the main underwriter of reverse mortgages in Canada since its predecessor, Canadian Home Income Plan, pioneered the concept in 1986.
CMT, a special purpose entity, finances a portion of HomEquity Bank's reverse mortgage portfolio, which totalled approximately $1.9 billion as at September 30, 2015, with medium term notes.
SOURCE CHIP Mortgage Trust
For further information: Steven Ranson, President and Chief Executive Officer (416) 413-4663, or John Garofano, Treasurer (416) 413-4674.