TFC Enterprises Announces $81 Million Securitization: Its Second Securitization Since December 1999
5 October 2000
TFC Enterprises Announces $81 Million Securitization: Its Second Securitization Since December 1999
NORFOLK, Va., Oct. 5 TFC Enterprises, Inc. (the Company)
today announces the placement of $81 million of automobile
receivables-backed securities through Rothschild Inc.
The notes, purchased by a single investor, are expected to have an average
life of one year with an interest rate of approximately 7.36%. The coupon
cost compared to the weighted average APR of the loans of approximately 19.80%
leaves a gross interest spread of approximately 12.44%.
The notes are rated AAA by Standard & Poor's and Aaa by Moody's Investor
Services. Timely interest and ultimate principal are guaranteed by an
insurance policy provided by Financial Security Assurance, Inc. (FSA). The
rating by Standard & Poor's and Moody's is based on the issuance of the
insurance policy by FSA.
"This is the Company's second securitization since December of 1999. This
funding vehicle not only provides the Company protection from future interest
rate risk associated with the volatile interest rate environment but also
provides the necessary flexibility and capacity to continue the Company's
growth", stated Craig Poppen, TFCE's Chief Financial Officer. "This
transaction was also structured as an on balance sheet securitization avoiding
the uncertainties of "gain on sale" accounting", added Poppen.
"We feel the performance of the December 1999 securitization, the
continued profitability of the Company, the additional $5 million of
subordinated notes placed in August of 2000 and the growth of our business all
support a renewed level of confidence by "debt" investors in the Company,"
continued Robert S. Raley, Jr., TFCE Chairman, President and Chief Executive
Officer. "I would just hope Wall Street would recognize the small cap tier of
companies like TFCE that are performing considerably above the valuations
placed on them by the "street"."
In additional to historical information, this press release statements by
the Company's management team may contain forward-looking statements that are
subject to risks and uncertainties that could cause the Company's results to
differ materially from those anticipated in forward-looking statements.
Readers are cautioned not to place undue reliance on forward-looking
statements, which reflect management's current analysis. In accordance with
the Private Securities Litigation Reform Act of 1995, the following are
factors that could cause the Company's actual results to differ materially
from those expressed or implied by such forward-looking statements: a rise in
interest rates, a deterioration of credit experience, competitive pricing and
other factors, the loss of or reduction in its credit facilities, or if the
Company were to face increased competition. Investors are encouraged to
review TFC Enterprise's SEC filings for more information about the factors
affecting the Company's business.
TFC Enterprises, Inc., conducts its operations through four wholly-owned
subsidiaries: THE Finance Company, specializes in purchasing and servicing
installment sales contracts originated by automobile and motorcycle dealers;
First Community Finance, Inc., is involved in the direct origination and
servicing of consumer loans; Recoveries, Inc., a third party debt collection
agency, services foreclosed or troubled loan portfolios and receivables for
medical organizations and others; and PC Acceptance.com, Inc., specializing
in purchasing and servicing installment sales contracts affiliated with
personal computers and related equipment. Based in Norfolk, VA, TFC
Enterprises, Inc., has eleven contract production offices of THE Finance
Company throughout the United States and twenty-one offices of First Community
Finance in Virginia and North Carolina. The Company's common stock symbol is
listed on Nasdaq National Market and trades under the symbol "TFCE".