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
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
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
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.
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
SOURCE RIFCO Inc.
For further information:
Lance A. Kadatz
Vice President and Chief Financial Officer
Telephone: 1-403-314-1214 EXT 7007