Newtek Business Services Corp., (NASDAQ: NEWT), an internally
managed business development company (“BDC”), today announced that
it has closed its eleventh small business loan securitization, with
the sale of $103,430,000 of Unguaranteed SBA 7(a) Loan-Backed
Notes, Series 2021-1, consisting of $79,680,000 of Class A Notes
and $23,750,000 Class B Notes (collectively, the “Notes”), rated
“A” and “BBB-”, respectively, by S&P Global, Inc. (“S&P”).
The Notes had an 82.50% advance rate, and were priced at an average
initial yield of approximately 2.02% (Note interest rates are
floating rate and adjust monthly), which is equivalent to a spread
of 192 basis points over LIBOR, across both classes.
The Notes are collateralized by the right to receive payments
and other recoveries attributable to the unguaranteed portions of
SBA 7(a) loans made by Newtek Small Business Finance, LLC ("NSBF")
pursuant to Section 7(a) of the Small Business Act, and
overcollateralized by NSBF's participation interest in the
unguaranteed portions. Deutsche Bank Securities and Capital One
Securities acted as joint book running managers for the
transaction.
Barry Sloane, Chairman, President and Chief Executive Officer of
Newtek Business Services Corp. said, “We are extremely pleased that
NSBF was able to issue its eleventh securitization, as we have
reestablished our core SBA 7(a) lending business. According to data
from the Small Business Administration (“SBA”), NSBF is ranked by
dollar origination volume as the largest non-bank SBA lender and
the third largest SBA lender, including banks, at SBA’s fiscal year
end of September 30, 2021. This 2021-1 Securitization has
attractive economics for the Company, with the unguaranteed
portions of the SBA 7(a) loans having been funded with 100% equity
prior to the securitization, raising approximately $100.3 million
of total cash liquidity, which includes $76.9 million of cash at
closing, and a prefunding amount of $23.3 million, which we expect
to draw down within 90 days, and with an advance rate of 82.50%
across the A rated and BBB- rated Notes. The proceeds from this
2021-1 Securitization, which is classified as non-recourse
financing, can be used to refinance higher-cost debt, fund loan
originations, as well as other general corporate purposes. In
addition, we are pleased to report that the Class A Notes were 4.7
times oversubscribed and the Class B Notes were 3.4 times
oversubscribed with 10 of some of the largest and most
sophisticated institutional investors participating in this
deal.”
Mr. Sloane continued, “We have continued to augment our loan
servicing staff and are pleased that we have been able to service
our existing loan portfolio, maintaining delinquency and default
data that is consistent with pre-pandemic levels. We attribute this
solid credit performance to working closely with the SBA and our
borrowers on three rounds of PPP financing, payments associated
with Section 1112 of the Cares Act, Economic Injury Disaster Loan
financing, and the Employee Retention Credit Program, offering our
customer base assistance in weathering the pandemic effects.”
Mr. Sloane further commented, “We currently have a full pipeline
of loans across SBA 7(a), SBA 504, and non-conforming conventional
loan categories and, as such, are reaffirming our guidance across
several metrics. We are reaffirming our full year 2021 SBA 7(a)
loan funding forecast of between $560 and $600 million, which would
represent record annual SBA 7(a) fundings for Newtek, as well as a
12% increase, at the midpoint of the 2021 forecasted range, over
SBA 7(a) loan fundings in 2019. In addition, the Company will pay
its fourth quarter 2021 dividend of $1.05 per share on December 30,
2021 to shareholders of record on December 20, 2021. With that
payment, the Company will have paid $3.15 per share in dividends in
2021, which would represent a 53.7% increase over dividends paid in
2020. The Company is reaffirming its first quarter 2022 dividend of
$0.65 per share1, which would represent a 30% increase over the
first quarter 2020 dividend. Finally, we are reiterating our
earnings guidance and expect 2021 full year 2021 NII of $0.80 per
share and ANII of $3.40 per share. We look forward to reporting our
2021 full year results during the first quarter of 2022.”
Mr. Sloane concluded, “We would like to thank Deutsche Bank
Securities and Capital One Securities for their hard-earned
efforts, especially during choppy markets, and we appreciate the
loyalty of our repeat investors, as well as the interest of new
investors, and their faith in our securitization notes, that have
consistently maintained their ratings or been upgraded.”
1Amount and timing of dividends, if any, remain subject to the
discretion of the Company’s Board of Directors.
Newtek Business Services Corp., Your Business Solutions
Company®, is an internally managed BDC, which along with its
controlled portfolio companies, provides a wide range of business
and financial solutions under the Newtek® brand to the small- and
medium-sized business (“SMB”) market. Since 1999, Newtek has
provided state-of-the-art, cost-efficient products and services and
efficient business strategies to SMB relationships across all 50
states to help them grow their sales, control their expenses and
reduce their risk.
Newtek’s and its portfolio companies’ products and services
include: Business Lending, SBA Lending Solutions, Electronic
Payment Processing, Technology Solutions (Cloud
Computing, Data Backup, Storage and Retrieval, IT Consulting),
eCommerce, Accounts Receivable Financing & Inventory Financing,
Insurance Solutions, Web Services, and Payroll and Benefits
Solutions.
Newtek® and Your Business Solutions Company®,
are registered trademarks of Newtek Business Services Corp.
Note Regarding Forward Looking
Statements
This press release contains certain
forward-looking statements. Words such as “believes,” “intends,”
“expects,” “projects,” “anticipates,” “forecasts,” “goal” and
“future” or similar expressions are intended to identify
forward-looking statements. All forward-looking statements involve
a number of risks and uncertainties that could cause actual results
to differ materially from the plans, intentions and expectations
reflected in or suggested by the forward-looking statements. Such
risks and uncertainties include, among others, intensified
competition, operating problems and their impact on revenues and
profit margins, anticipated future business strategies and
financial performance, anticipated future number of customers,
business prospects, legislative developments and similar matters.
Risk factors, cautionary statements and other conditions, which
could cause Newtek’s actual results to differ from management’s
current expectations, are contained in Newtek’s filings with the
Securities and Exchange Commission and available through
http://www.sec.gov/. Newtek cautions you that forward-looking
statements are not guarantees of future performance and that actual
results or developments may differ materially from those projected
or implied in these statements.
SOURCE: Newtek Business Services Corp.
Investor Relations & Public
RelationsContact: Jayne Cavuoto Telephone: (212) 273-8179
/ jcavuoto@newtekone.com
NewtekOne (NASDAQ:NEWT)
Historical Stock Chart
From Mar 2024 to Apr 2024
NewtekOne (NASDAQ:NEWT)
Historical Stock Chart
From Apr 2023 to Apr 2024