BCF Builders Capital Mortgage Corp

Builders Capital Mortgage Corp. (TSX VENTURE:BCF) (Builders Capital or the
company) today released financial results for the three months ended March 31,
2014, which represent the first quarter of its 2014 fiscal year and the
company's first full quarter as a publicly-traded mortgage investment
corporation (MIC). 


First Quarter Results

For the three months ended March 31, 2014, mortgage revenue was $786,410,
representing annualized gross revenue of 13.6% of gross share capital. This
revenue consisted of $760,085 in interest and $26,325 in lender fees charged to
borrowers. 


First quarter operating expenses, excluding the provision for mortgage losses,
were $87,682, or 11.1% of revenues. The provision for loan losses of $60,763 was
estimated by management, based on an analysis of historical bad debts of the
predecessor companies and current analysis of the construction finance
marketplace. This is a collective provision and does not relate to any
individual mortgage. 


Total comprehensive income for the first quarter was $637,965, or $0.27 per
share, based on the weighted average number of shares outstanding for the
period. This translates into earnings of $0.46 per Class A Non-Voting Share.
Given the dividend priority granted to Class A Non-Voting Shares held by the
public, the effective Class A Non-Voting Share dividend cover ratio for the
quarter was 2.3. 


"We are pleased with our initial financial performance as a public entity," said
Sandy Loutitt, President of Builders Capital. "Our tight focus on financing
short-term, wood-frame residential construction in strong urban markets like
Calgary and Edmonton positions us to generate above average risk weighted
returns. Builders Capital has an established, full-service asset management
platform and a strong team of experienced professionals who are proven
performers. We're ready to grow." 


Mortgage Portfolio

At March 31, 204, Builders Capital's mortgage portfolio consisted of 35 mortgage
loans with an aggregate value of $24.6 million. Of the 30 mortgages the company
acquired at its start-up, five with values totaling $3.7 million at December 31,
2013 were paid out during the first quarter. These were replaced by ten new
mortgages totaling $3.8 million. No loans were in default during the quarter. 


Distributions

On March 21, 2014, Builders Capital declared a first quarter dividend of $0.1973
per Class A Non-Voting share to shareholders of record on March 31, 2014,
payable on April 30, 2014. The dividend amount was calculated to provide an 8%
return on the $10.00 initial Class A Non-Voting share price, prorated for the 90
days in the quarter. On an annual basis, this level of distribution is
equivalent to $0.80 per Class A Non-Voting share. 


Subsequent to quarter-end, on April 30, 2014, the company declared a dividend of
$0.3456 per share to Class B Non-Voting Shareholders of record on April 28,
2014, payable on April 30, 2014. This dividend applied to the 2013 stub period,
for which Class A Non-Voting Shareholders had already received a dividend, and
the first quarter of 2014.


Outlook

Builders Capital expects that continued steady housing starts in southern
Alberta, its primary market, will drive strong demand for construction financing
for at least the next several years. In addition to strengthening its position
in Alberta, the company intends to expand lending to other western Canadian
markets in the future. 


"In particular, like Alberta, Saskatchewan is expected to continue to exceed
average GDP growth in Canada," said Loutitt. "We believe that employment growth,
a strengthening economy and high levels of net migration make Saskatchewan a
good market for Builders Capital."


Loutitt noted that, despite favourable conditions in both provinces, prevailing
low interest rates have increased borrower's sensitivity to price. "In response,
we will be reducing rates and stepping up our marketing," he said. "We are
confident that these strategies will allow us to continue to grow, fully utilize
our capital, and remain both competitive and profitable."


A more detailed discussion of the company's financial results can be found in
its 2014 First Quarter Management's Discussion and Analysis, which will be
posted along with the unaudited interim condensed financial statements for the
period on Builders Capital's website (www.builderscapital.ca) and SEDAR
(www.sedar.com) on May 30, 2014.


About Builders Capital

Builders Capital is a mortgage lender providing short-term course of
construction financing to builders of residential, wood-frame properties in
Western Canada. The company was formed on March 28, 2013 but did not commence
active operations until December 12, 2013, on the closing of its initial public
offering, following which it acquired a portfolio of mortgages from two
predecessor companies. Builders Capital's investment objective is to generate
attractive returns, relative to risk, in order to provide stable and steady
distributions to shareholders while remaining focused on capital preservation
and staying within the criteria mandated for mortgage investment corporations,
as defined in the Income Tax Act. 


As a MIC, Builders Capital is not subject to income tax provided that it
distributes all of its taxable income as dividends to shareholders within 90
days of its December 31st year-end. Such dividends are generally treated by
shareholders as interest income, so that each shareholder is in the same tax
position as if their proportionate share of mortgage investments made by the
company had been made directly by the shareholder.


Forward-Looking Information

This news release contains forward-looking statements within the meaning of
applicable securities legislation, including statements with respect to
management's beliefs, estimates and intentions, and similar statements
concerning anticipated future events, results, circumstances, performance or
expectations that are not historical facts. Forward-looking statements generally
can be identified by the use of forward-looking terminology such as "outlook",
"objective", "may", "will", "expect", "intent", "estimate", "anticipate",
"believe", "should", "plans" or "continue" or similar expressions suggesting
future outcomes or events. Such forward-looking statements reflect management's
current beliefs and are based on information currently available to management.
These statements are not guarantees of future performance and are based on
estimates and assumptions that are subject to risks and uncertainties which
could cause actual results to differ materially from the forward-looking
statements contained in this news release. These include, among other things,
risks associated with mortgage lending, competition for mortgage lending, real
estate values, interest rate fluctuations, environmental matters and the general
economic environment. The company cautions that the foregoing list is not
exhaustive, as other factors could adversely affect its results, performance or
achievements. Readers are cautioned against undue reliance on any
forward-looking statements. Although the forward-looking information contained
in this news release is based upon what management believes are reasonable
assumptions, there can be no assurance that actual results will be consistent
with these forward-looking statements. Except as required by applicable law,
Builders Capital undertakes no obligation to publicly update or revise any
forward-looking statement, whether as a result of new information, future events
or otherwise.


Neither TSX Venture Exchange nor its Regulation Services Provider (as that term
is defined in policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release.


FOR FURTHER INFORMATION PLEASE CONTACT: 
Builders Capital Mortgage Corp.
John Strangway
Chief Financial Officer
(403) 685-9888
www.builderscapital.ca

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