Move reflects company's growth prospects, says CEO
Canadian consumer lender goeasy Ltd. has announced a significant amendment to its senior secured revolving credit facility. The amendment increases the existing credit facility from $370 million to $550 million and extends its maturity to July 18, 2027.
The company, which specializes in providing financial services to Canadians with non-prime credit, stated that the facility will continue to bear interest at the Adjusted 1-Month Term Canadian Overnight Repo Rate Average (Adjusted CORRA) plus 225 basis points. With the Adjusted CORRA rate at 4.92% as of July 17, 2024, the interest rate on the drawn principal amounts to 7.17%. The revised credit facility also features enhanced borrowing terms, including improved advance rates, less restrictive covenants, and a broader syndicate of lenders.
Jason Mullins, goeasy’s president and chief executive officer, expressed confidence in the company’s growth prospects. “The increase to our revolving credit facility and the addition of three new lenders to the syndicate demonstrates the continued confidence of our bank partners, while providing additional capital to support our organic growth plans,” he said.
Hal Khouri, goeasy’s executive vice president and chief financial officer, highlighted the expanded funding capacity. “The increase to the credit facility now lifts our total funding capacity to nearly $1.3 billion,” he said. “In addition to several enhancements that improve the flexibility of the facility, it now includes participation from all the major banks in Canada, a testament to the strength of our business.”
According to a news release, the amended credit facility is underwritten by a consortium of major financial institutions, including the Bank of Montreal (BMO), Royal Bank of Canada (RBC), Wells Fargo Bank, Canadian Imperial Bank of Commerce (CIBC), National Bank of Canada, and Toronto-Dominion (TD) Bank. The three new lenders to join the syndicate include Desjardins, Bank of Nova Scotia, and Raymond James. The company retains an accordion feature, which allows for an increase in the facility size by up to an additional $150 million.
Headquartered in Mississauga, Ontario, goeasy Ltd. provides non-prime leasing and lending services through its easyhome, easyfinancial, and LendCare brands. The company employs over 2,500 people and offers unsecured and secured installment loans, merchant financing, and lease-to-own merchandise. Customers can access services online, through mobile platforms, at over 400 locations, and via more than 10,000 merchant partners.
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