TORONTO, Jan. 20 /CNW/ - HOMEQ Corporation (TSX: HEQ) ("HOMEQ" or the "Company") today announced that its subsidiary, CHIP Mortgage Trust ("CMT"), has redeemed $25,000,000 of Series 2008-1 senior medium term notes (the "Notes") with an expected final repayment date of May 16, 2011. In addition, CMT has given notice that it will redeem a further $50,000,000 of Notes within the next 30 days.
The funds used to redeem the Notes are a combination of cash-flow generated in the normal course of business, and from Guaranteed Investment Certificates ("GICs") issued by HomEquity Bank.
"We are extremely happy with our ability to redeem the Notes" said Gary Krikler, Senior Vice President and Chief Financial Officer. "HomEquity Bank's access to funds through the sale of GICs has significantly enhanced our ability to manage liquidity. By repurchasing these Notes, the magnitude of maturities scheduled for the second quarter of 2011 in CMT will be reduced by 26%".
Forward Looking Statements
HOMEQ Corporation from time to time makes written and verbal forward-looking statements about business objectives, operations, performance, and financial condition, including the likelihood of HOMEQ's success in developing and expanding its business. These may be included in HOMEQ's and its predecessor's annual reports, regulatory filings, reports to shareholders, 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 HOMEQ. Actual results may differ materially from those expressed or implied by such forward-looking statements. HOMEQ does not undertake to update any forward-looking statement, whether written or verbal, that may be made from time to time.
About HOMEQ Corporation and HomEquity Bank
HOMEQ's wholly owned subsidiary, HomEquity Bank is the only national provider of reverse mortgages to homeowners aged 60 and over, Canada's fastest growing demographic segment. HomEquity Bank originates and administers Canada's largest portfolio of reverse mortgages under the CHIP Home Income Plan brand. As of December 31, 2010, the mortgage portfolio comprised approximately 8,000 reverse mortgages with an accrued value of $1.0 billion, secured by residential properties across Canada worth approximately $2.8 billion. HomEquity Bank has been the main underwriter of reverse mortgages in Canada since its predecessor, Canadian Home Income Plan, pioneered the concept in 1986.
HomEquity Bank has an effective direct-to-consumer distribution model as well as a well-established referral network. This extensive referral network includes all major Canadian banks, credit unions, mortgage brokers, investment and financial planning firms.
HomEquity Bank also offers competitive Guaranteed Investment Certificates (GICs) to investors across Canada through independent deposit brokers and major Canadian banks. For more information about HomEquity Bank, please visit www.homequitybank.ca. Additional information on HOMEQ Corporation, including annual and quarterly reports can be viewed at www.homeq.ca.
HOMEQ's shares trade on the Toronto Stock Exchange under the symbol HEQ. Additional information, including annual and quarterly reports can be viewed at www.homeq.ca.
SOURCE HOMEQ Corporation
For further information: Gary Krikler, Senior Vice President and Chief Financial Officer, (416) 413-4679, or Scott Cameron, Vice President, Finance, (416) 413-6605