EDMONTON, May 14, 2014 /CNW/ - The Cash Store Financial Services Inc.
("Cash Store Financial" or the "Company") (TSX: CSF) announced today
that it will be winding down its brokered payday loan business
conducted in 33 of its branch locations located in New Brunswick,
Prince Edward Island, Newfoundland, Northwest Territories and Yukon. In
addition, the Company will be winding down its brokered title loan
business conducted in 10 of its branch locations across Canada. The
Company will also be seeking to transition its brokered loan business
model in Manitoba to a direct lending payday loan business model. Cash
Store Financial received an order of the Ontario Superior Court of
Justice (Commercial List) ("Court") on May 13, 2014 in the Company's
proceedings under the Companies' Creditors Arrangement Act ("CCAA") approving the decision to wind down the brokered lending
Cash Store Financial further announced today that it has abandoned its
appeal of the previously announced decision of the Court which declared
the basic line of credit that the Company made available in Ontario to
be a payday loan subject to the Ontario Payday Loans Act, 2008 ("Act") and which prohibited the Company from acting as a loan broker
without a license under the Act.
Cash Store Financial is committed to completing the restructuring
process quickly and efficiently. The Company remains open for business
and its branches continue to operate. For further information on Cash
Store Financial and the CCAA proceedings, please consult the website of
FTI Consulting Canada Inc., the Court-appointed Monitor of Cash Store
Financial, at http://cfcanada.fticonsulting.com/cashstorefinancial/.
About Cash Store Financial
Cash Store Financial operates 506 branches across Canada under the
banners "Cash Store Financial" and "Instaloans". Cash Store Financial
also operates 27 branches in the United Kingdom.
Cash Store Financial and Instaloans primarily act as lenders to
facilitate short-term advances and provide other financial services to
income-earning consumers who may not be able to obtain them from
traditional banks. Cash Store Financial also provides a private-label
debit card (the "Freedom" card) and a prepaid credit card (the "Freedom
MasterCard") as well as other financial services, including bank
Cash Store Financial is headquartered in Edmonton, Alberta.
Cash Store Financial is a Canadian corporation that is not affiliated
with Cottonwood Financial Ltd. or the outlets Cottonwood Financial Ltd.
operates in the United States under the name "Cash Store". Cash Store
Financial does not do business under the name "Cash Store" in the
United States and does not own or provide any consumer lending services
in the United States.
Forward Looking Statements:
This news release contains certain forward-looking statements about the
objectives, strategies, financial conditions, results of operations and
businesses of Cash Store Financial. Statements that are not historical
facts are forward-looking and are subject to important risks,
uncertainties and assumptions. These statements are based on our
current expectations about our business, and upon various estimates and
assumptions. The results or events predicted in these forward-looking
statements may differ materially from actual results or events if known
or unknown risks, trends or uncertainties affect our business, or if
our estimates or assumptions turn out to be inaccurate. As a result,
there is no assurance that the circumstances described in any
forward-looking statement will materialize. Significant and reasonably
foreseeable factors that could cause our results to differ materially
from our current expectations, include, but are not limited to, any
decision of the Ontario Superior Court of Justice in the CCAA
proceedings that is adverse to Cash Store Financial, the inability of
Cash Store Financial to fulfill the conditions to funding under any DIP
financing agreement to be entered into by Cash Store, and other factors
that could affect Cash Store Financial's ability to continue its
operations during the CCAA proceeding, including the factors that are
discussed in the section entitled "Risk Factors" contained in our
Annual Information Form for the year ended September 30, 2013 dated
December 11, 2013 filed by The Cash Store Financial Services Inc. with
the Canadian securities commissions (available on SEDAR at www.sedar.com), as updated in our most recent Management's Discussion and Analysis
for the three months ended December 31, 2013. Unless required by law,
we disclaim any intention or obligation to update any forward-looking
statement even if new information becomes available, as a result of
future events or for any other reason.
SOURCE: The Cash Store Financial Services Inc.
For further information:
For further information, please contact:
William Aziz, Chief Restructuring Officer, at firstname.lastname@example.org