Normal course repayments increase
liquidity, pay down debt facilities
Another Watch
List account moves toward successful restructuring
TORONTO, Jan. 12, 2016 /CNW/ - Callidus Capital
Corporation ("Callidus" or the "Company") (TSX: CBL),
today updated the market regarding borrowers' repayments.
During December 2015 alone, two
loans were fully repaid in accordance with their original
terms. One of the loans, for $25.1
million of a $25.1 million
facility, was originated in April
2014 and was repaid in full in 21 months. The second
loan, which reached a maximum $22.9
million of a $28.2 million
facility, was originated in February
2014 and was repaid in full in 23 months. Given the
continued growth in the book since the IPO and the average expected
duration, repayments in the normal course are expected to
accelerate as the book continues to grow. As at January 7, 2016 the pipeline of potential new
loans increased to approximately $640
million, relative to our November 5,
2015 press release.
Newton Glassman, Callidus'
Executive Chairman and Chief Executive Officer commented "We are
updating the market on these loans not because their repayment is
out of the ordinary, but to help provide insight into our typical
loan cycle and because it demonstrates the consistent value of our
proprietary loan origination systems and processes. We
investigate and evaluate every factor possible in managing our
credit quality – it is the foundation for our business plan.
Ultimately full loan repayment is the normal course of business for
Callidus Capital, sometimes with the help of a court process.
In fact, during the first quarter of 2016, we expect two to three
more of our borrowers will also repay us in full under normal
terms."
Callidus has demonstrated a history of prudent risk
management. As disclosed in Callidus' 2015 Q3 release, since
2006, Callidus has advanced 100 loans representing total credit
facilities of $2.0 billion of which
60 loans have been fully repaid or realized. Since 2006 there
have been realized losses of $15
million (approximately 0.3% annually of commitments,
averaged over nine years). Of the 60 loans, 52 loans were
fully repaid, in some cases after informal loan restructurings,
while five went through a form of restructuring and were then fully
repaid.
David Reese, President and Chief
Operating Officer of Callidus said "These repayments increased our
liquidity and the collected funds were put to use in the normal
course including, among other areas, paying down a portion of our
debt and funding future loan growth initiatives. We remain
committed to our growth objectives, as stated during our IPO, of
doubling the book every two to three years."
Mr. Glassman added, "In addition, Callidus is very close to
successfully restructuring another loan from the "watch list" for
full value. As a consequence, Callidus expects full normal
repayment of this account over time. As we have often stated
in the past Callidus uses a variety of techniques to mitigate
potentially challenging situations and to minimize any risk of
loss, and this situation illustrates that an overwhelming majority
of those efforts are successful."
About Callidus Capital Corporation
Established in
2003, Callidus Capital Corporation is a Canadian company
that specializes in innovative and creative financing solutions for
companies that are unable to obtain adequate financing from
conventional lending institutions. Unlike conventional lending
institutions who demand a long list of covenants and make credit
decisions based on cash flow and projections, Callidus credit
facilities have few, if any, covenants and are based on the value
of the company's assets, its enterprise value and borrowing needs.
Callidus employs a proprietary system of monitoring collateral and
exercising control over the cash inflows and outflows of each
borrower, enabling Callidus to very effectively manage risk of
loss.
Forward-Looking Statements
Certain statements made
herein contain forward-looking information. Although Callidus
believes these statements to be reasonable, the assumptions upon
which they are based may prove to be incorrect. Furthermore, the
forward-looking statements contained in this press release are made
as at the date of this press release and Callidus does not
undertake any obligation to update publicly or to revise any of the
included forward-looking statements, whether as a result of new
information, future events or otherwise, except as may be required
by applicable securities law.
SOURCE Callidus Capital Corporation