Street Capital Financial to Continue and Operate as Street Capital Bank of Canada
TORONTO, Dec. 13, 2016 /CNW/ - Street Capital Group Inc. ("Street Capital" or the "Company") (TSX: SCB), today announced that its wholly-owned subsidiary, Street Capital Financial Corporation ("Street Capital Financial"), has received Letters Patent from the Federal Minister of Finance and an Order to Commence and Carry on Business from the Office of the Superintendent of Financial Institutions, Canada, permitting Street Capital Financial to continue and operate as a Canadian Schedule I bank. Effective February 1, 2017, Street Capital Financial will continue as Street Capital Bank of Canada ("Street Capital Bank") and will commence its operations as a federally regulated financial institution.
Approximately four years ago, Street Capital Financial conducted a strategic review of its business as well as the Canadian mortgage regulatory environment and concluded that there was an opportunity to ensure its continued growth by becoming a bank. Street Capital Bank will have the ability to access additional sources of liquidity, strategically positioning it to better support its current mortgage business, its planned expansion in this segment and future retail banking opportunities.
"The approval of our Schedule I bank licence concludes a four-year process for our company and represents a significant milestone in our long-term strategy," said Ed Gettings, Chief Executive Officer of Street Capital Group Inc. "We are ready to commence the next phase of growth by building upon our enduring relationships with mortgage brokers and our base of over 130,000 valued customers. I would like to thank all of our employees, our senior management team, our board of directors as well as our professional advisors for their hard work, dedication, and guidance throughout this process. I would also like to thank the application and supervision teams at OSFI for their time and dedication to ensuring Street Capital Bank will operate successfully within the Canadian banking regulatory environment."
Following commencement of operations, Street Capital Bank is targeting launch of its new uninsured mortgage product suite in Q1 2017 which will be funded through GIC products distributed through registered deposit dealers. In the coming years, Street Capital Bank will focus its energy and capital on continuing to build its banking platform and plans to introduce additional retail banking products starting with the bank's credit card offering in 2018.
"As we enter our 10th anniversary, we are confident that the Schedule I bank licence will provide us with a significant competitive advantage as we continue to prudently grow our business," said Lazaro DaRocha, President of Street Capital Group Inc. "Approval represents a validation of our operating model and the risk management practices we have applied since our founding in 2007. With our capital base, the infrastructure we have built and the experience of our senior management team, Street Capital Bank will operate from a position of strength as it continues to execute on its business plan while generating revenue and earnings growth for our shareholders."
About Street Capital Group Inc. (www.streetcapitalgroup.ca)
Street Capital (TSX: SCB) is a financial services company operating in residential mortgage lending through its wholly owned subsidiary Street Capital Financial Corporation (www.streetcapital.ca), which was founded in 2007 and is one of the largest non-bank mortgage lenders in Canada. The Company's goal is to create shareholder value by building a substantial, diversified financial services organization. Street Capital Financial Corporation sources its mortgages primarily through a network of independent, high quality mortgage brokers across Canada with whom it has built relationships. Street Capital Financial Corporation offers a broad lineup of high ratio and conventional mortgages, to prime borrowers, and sells the mortgages it underwrites to top-tier financial institutions. Business revenues are almost entirely from the gain on sale of mortgages.
This release contains certain forward-looking statements that are based on management's exercise of business judgment as well as assumptions made by, and information currently available to, management. When used in this document, the words "may", "plan", "will", "anticipate", "believe", "estimate", "expect", "intend", and words of similar import, are intended to identify any forward-looking statements. You should not place undue reliance on these forward-looking statements. These statements reflect our current view of future events and are subject to certain risks and uncertainties as outlined in the Company's Annual Information Form and other filings made with securities regulators, which are available on SEDAR (www.sedar.com). These factors include, without limitation: timing and results of banking application process, expansion opportunities, technological changes, regulatory changes (including mortgage insurance rules), and changes to the business and economic environment, including, but not limited to, Canadian housing market conditions and activity, interest rates, mortgage backed securities markets, and employment conditions that may impact the Company, its mortgage origination volumes, investments and capital expenditures, and competitive factors that may impact revenue and operating costs. Any of these factors, amongst others, could cause actual results to vary materially from current results or from the Company's currently anticipated future results and financial condition. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, our actual results could differ materially from those anticipated in these forward-looking statements. We undertake no obligation, and do not intend, to update, revise or otherwise publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date hereof, or to reflect the occurrence of any unanticipated events. Although we believe that our expectations are based on reasonable assumptions, we can give no assurance that our expectations will materialize.
SOURCE Street Capital Group Inc.
For further information: W.E. Gettings, CEO, Street Capital Group Inc., Ed.Gettings@streetcapital.ca; Jonathan Ross, LodeRock Advisors Inc., Inv. Relations, email@example.com