Newtek Conventional Lending LLC Closes its Securitization with the Sale of $56.3 Million of Notes Backed by Conventional Commercial Loans
January 28 2022 - 10:15AM
Newtek Business Services Corp., (NASDAQ: NEWT), an internally
managed business development company (“BDC”), today announced that
Newtek Conventional Lending LLC (“NCL”), a Newtek joint venture,
closed its conventional commercial loan securitization with the
sale of $56.3 million Class A Notes (“Notes”), NCL Business Loan
Trust 2022-1, Business Loan-Backed Notes, Series 2022-1, secured by
a segregated asset pool consisting primarily of conventional
commercial business loans (“Business Loans”), including Business
Loans secured by liens on commercial or residential mortgaged
properties, originated by NCL and Newtek Business Lending, LLC. The
Notes were rated “A” (sf) by DBRS Morningstar. The Notes had a
65.0% advance rate, and were priced at a yield of
3.209%.
The Notes are collateralized by, among other things, the
Business Loans and the right to receive payments and other
recoveries attributable to the Business Loans. Deutsche Bank
Securities was the Sole Structuring Advisor and Sole Book Running
Manager, and Capital One Securities was Co-Manager, for the
transaction.
Barry Sloane, Chairman, President and Chief Executive Officer of
Newtek Business Services Corp. said, “The closing of NCL Business
Loan Trust 2022-1 this week is a watershed event for our Company.
Prior to the onset of the pandemic, we began building a portfolio
with our institutional joint venture JV partner to pursue loans
that didn’t fit our traditional government-guaranteed SBA 7(a) or
SBA 504 loan programs. Coupled with the extraordinary reach of our
referral system and robust loan pipeline, through JV partnerships,
we believe we can cast a wider net to reach and meet the needs of
additional types of borrowers with our lending program. Borrowers
in our loan portfolio that have outgrown the SBA 7(a) loan amount
maximum of $5.0 million, those that require a fixed-rate loan
alternative, or those that are too credit worthy and would fail the
SBA’s credit elsewhere test, would be ideal candidates for our
non-conforming conventional loan program. While our non-conforming
conventional loan program had a hiatus due to the effects of the
pandemic, we are moving forward by building a pipeline and working
on signing on new JV partners. We believe the profitability profile
and volume demands for our non-conforming conventional loans has
the potential to surpass the performance of our historical and
traditional government-guaranteed lending programs. Of course, we
are focused on continuing to grow our SBA 7(a) and SBA 504 loan
programs, but now we also look forward to levering our operational
infrastructure, track record and securitization expertise to grow
our non-conforming conventional loan program.”
Mr. Sloane continued, “We would like to thank Deutsche Bank
Securities and Capital One Securities, as well as the efforts of
DBRS Morningstar to rate the first of this type of loan
securitization transaction, for our Company. We welcome investors
to visit the DBRS Morningstar website to access the presale memo.
We are also extremely pleased to have closed the underwriting book
after just 24 hours as this transaction was two-times
oversubscribed. Newtek is dedicated to continuing to build a
comprehensive loan funding program that will meet the maturation
cycle of independent business owners, in particular women and
minorities that often have difficulty accessing debt financing. We
believe our non-conforming conventional loan program not only has
the potential to add another cylinder to Newtek’s earnings engine,
but can enable us to diversify our business further by expanding
our reach to satisfy the needs of a broader pool of borrowers, as
well as generate additional servicing income.”
Mr. Sloane concluded, “The announcement by the Company of its
intention to acquire National Bank of New York City, subject to
required approvals, is consistent with the Company’s goal to
provide a full range of business and financial solutions, including
government-guaranteed and non-conforming commercial loans, to its
customers. We look forward to reporting our full year 2021 results,
and our endeavors and progress as we move full force into the 2022
calendar year.”
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