goeasy Increases Credit Facility to Expand Consumer Loans

goeasy (TSX:GSY), lending fintech announced that it has increased its senior secured credit facility from C$189.5 million to C$310 million from a syndicate of banks. The interest rate from the credit facility ranges within 5.03 percent and 5.95 percent, for the purpose of expanding goeasy’s consumer loan offerings.

As quoted in the press release:

“The increase to our credit facility, accompanied by a further reduction in the interest rate, demonstrates the continued confidence our lenders have in the ability to execute on our business strategy,” said Jason Mullins, goeasy’s President and Chief Executive Officer. “With this amendment, our weighted average interest rate when our facilities are fully drawn reduces from 6.8% to 6.5% and the liquidity to fund our growth plan is extended through to the first quarter of 2021.”

Based on the cash on hand and the borrowing capacity under the Company’s amended revolving credit facility, the Company has approximately $215 million in funding capacity, which will allow it to achieve its targets for the growth of its consumer loan portfolio through to the first quarter of 2021. The Company has historically been able to obtain the additional financing required to fund the growth of its business at steadily lower costs of borrowing and increasing rates of leverage. However, the Company also estimates that once its existing and available sources of capital are fully utilized, the Company can continue to grow its loan portfolio by approximately $150 million per year solely from internal cash flows.

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