RETRANSMISSION: C.A. Bancorp Canadian Realty Finance Corporation Provides Investment Update
TORONTO, ONTARIO -- (MARKET WIRE) -- 10/27/08 -- C.A. Bancorp Canadian Realty Finance Corporation ("CRFC") (TSX: RF.A)(TSX: RF.PR.A)(TSX: RF.WT) is pleased to provide an investment update to its investors. CRFC was created to obtain exposure to an investment portfolio of mortgages and loans ("Mortgage Portfolio") in the Canadian commercial real estate sector.
CRFC is pleased to report that it is fulfilling its investment mandate ahead of schedule and expects to be fully invested by February 2009, or earlier. To date, approximately $50.4 million of the total $72.0 million in investable capital has funded, or has been committed to fund ($44.6 million funded and $5.8 million committed but not yet funded) Canadian commercial real estate mortgages or loans.
The average effective yield on the Mortgage Portfolio (including fees) is currently 11.9%.
Management is pleased with the credit quality of the Mortgage Portfolio to date. Each mortgage and loan is supported by a personal guarantee of the principal shareholders and/or a corporate guarantee, with the exception of one. As of October 15, 2008, the Mortgage Portfolio is in good standing and all payments are current.
CRFC seeks exposure to a secure portfolio of mortgages and loans whereby it:
- Does not invest outside of Canada,
- Does not invest in mortgage-backed securities,
- Does not invest in subprime single-family residential owner-occupied real estate,
The following table provides a summarized breakdown of the CRFC Mortgage Portfolio exposure as of October 15, 2008:
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BREAKDOWN OF THE MORTGAGE PORTFOLIO
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Portfolio Effective
By Type Weighting Yield
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1st Mortgages 79% 11.6%
2nd Mortgages 20% 13.0%
Secured Loans 1% 12.0%
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100% 11.9%
By Geography
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Ontario 52% 11.4%
Eastern Canada 18% 12.6%
Western Canada 30% 12.1%
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100% 11.9%
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Weighted Average Loan-to-Value Ratio 64.2%
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Average Mortgage Size $1.9 million
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Total Amount Advanced and Committed $50.4 million
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The Class A Shares
The Corporation's investment objectives with respect to the Class A Shares are to:
i) Pay quarterly cash distributions, initially expected to be $0.19 per quarter per Class A Share or 7.6% per annum, based on the original issue price of $10.00; and
ii) To preserve the net asset value of the Class A Shares.
The Warrants
Each Warrant will entitle the holder to purchase one Series 1 Preferred Share at a subscription price of $23.75 at any time on or before 4:00 p.m. (Toronto time) on September 30, 2011.
The Series 1 Preferred Shares
The Corporation's investment objectives with respect to the Series 1 Preferred Shares are to:
i) Pay fixed cumulative preferential quarterly cash distributions in the amount of $0.4219 per Series 1 Preferred Share representing a yield of 6.75% per annum on the original issue price of $25.00 per Series 1 Preferred Share; and
ii) Return the original issue price of the Series 1 Preferred Shares ($25.00 per Share) on March 31, 2018.
Trading information: The Class A Shares, Warrants and Series 1 Preferred Shares trade separately on the TSX under the symbols RF.A, RF.WT and RF.PR.A respectively.
C.A. Bancorp Canadian Realty Finance Corporation
CRFC is a mutual fund corporation incorporated under the laws of the Province of Ontario. It was created to obtain exposure to the investment performance of an actively managed portfolio of mortgages and secured loans in the Canadian commercial real estate sector on a tax-efficient basis.
C.A. Bancorp Inc.
C.A. Bancorp is a publicly traded Canadian merchant bank and alternative asset manager that provides investors with access to a range of private equity and other alternative asset class investment opportunities. C.A. Bancorp is focused on investments in small- and middle-capitalization public and private companies, with emphasis on the industrials, real estate, infrastructure and financial services sectors.
C.A Bancorp Inc. is a significant shareholder of CRFC and manages CRFC through its wholly-owned subsidiary C.A. Bancorp Ltd.
Certain statements included in this news release constitute forward looking statements including statements identified by the words "plan", "will" and "intend" and similar expressions or the negative thereof. The forward looking statements are not historical facts but reflect C.A. Bancorp's current expectations regarding future results or events. These forward looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations including but not limited to receipt of approval of the financial statements by the Board of Directors and scheduling difficulties and the timing for posting of the Management's Discussion and Analysis and Financial Statements on SEDAR. Readers are cautioned not to place undue reliance on forward-looking information. C.A. Bancorp undertakes no obligation to update publicly or otherwise revise any forward-looking statement or information except as required by law.