RIFCO Doubles Credit Union Securitization Facility to $20 Million

RED DEER, AB, Jan. 26 /CNW/ - RIFCO Inc. (TSX.V-RFC) today announced that its $10 million securitization facility with an Alberta Regional Credit Union (ARCU) first announced in June 2010, has been increased to $20 million.

This increase improves the Company's overall access to funds and takes securitization facilities to a record total of $80 million.

On January 18th, RIFCO announced that its credit facility with BMO Bank of Montreal is being transitioned to the corporate banking division.  With the transition came an increase to a $10M limit.

It is expected that multiple sources of funding will ultimately provide for a lower cost of funds and stronger value creation for shareholders. Access to increasing amounts of low cost capital is important in fueling the Company's growth aspirations. The immediate vision of RIFCO has been to appropriately grow to the point of originating $100 million per year in new loans. The Company has stated that its aspirations for the coming years range from 50% to 75% new loan growth. 

RIFCO maintains two other annual securitization facilities. A facility has been in place with Securcor Trust for $30M since 2005. A second facility was added in September 2009 for $30M from a schedule 1 Canadian Chartered Bank. RIFCO expects to maintain and utilize all three facilities.

Securitization is the manner in which RIFCO funds a percentage of its loan originations.  Regular sales of loan receivables to funding partners, in which the Company is not a beneficiary, provide cash resources for new originations.  RIFCO continues to service all sold loan contracts and maintains a retained interest in the loans through a performance-based holdback.

RIFCO is party to an agreement with ARCU pursuant to which RIFCO may transfer secured vehicle loans to ARCU for payment in an amount calculated pursuant to the agreement. The agreement provides that RIFCO may request the transfer of loans from time to time, up to a total facility amount of $20 million

About RIFCO

RIFCO is one of Canada's fastest-growing automotive finance companies. Non-traditional auto loans are indirectly originated through a growing network of selected new and used vehicle dealers operating in all provinces except Saskatchewan and Quebec.

The common shares of RIFCO INC. are traded on the TSX Venture Exchange under the symbol "RFC". There are 19.52 million shares (basic) outstanding and 20.93 million (fully diluted) shares.

Neither TSX Venture Exchange nor its Regulation Services Provider accepts responsibility for the adequacy or accuracy of this release.

Certain information contained in this press release, including information and statements which may contain words such as "potentially" "objective", "estimates", "would", "will", "contemplates", "expects" and similar expressions and statements relating to matters that are not historical facts, are forward-looking information including, but not limited to, information as to future performance.

SOURCE RIFCO Inc.

For further information:

RIFCO INC.
Lance A. Kadatz
Vice President and Chief Financial Officer
Telephone: 1-403-314-1214 EXT 7007
Fax: 1-403-314-1132
Email: kadatz@rifco.net
Website: www.rifco.net

Profil de l'entreprise

RIFCO Inc.

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