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Newtek Business Services Sells Fourth Small-Business Loan Securitization

December 19, 2013, 07:13 AM
Filed Under: Industry News

Newtek Business Services has completed the securitization and sale of an additional $24.4 million of Standard and Poor's ("S&P") A-rated senior-secured securities collateralized by its non-guaranteed portions of SBA 7(a) small-business loans.  This transaction was accomplished as an amendment to the 2013-1 securitization of $23.6 million S&P A-rated senior-secured securities, which closed on March 20, 2013. Guggenheim Securities, LLC acted as the placement agent for the sale of the additional trust notes and placed this issue with four institutional investors.  With this amendment, Newtek has completed the securitization and financing of approximately $63.8 million of non-guaranteed portions of SBA 7(a) small-business loans within the past 12 months.  S&P rated this securitization's trust Notes as 'A' based on the collateral in the entire, upsized pool.

Barry Sloane, President and Chief Executive Officer of Newtek Business Services, Inc. said, "We are thrilled to announce our second securitization sale this year, and our fourth to date. This is the first time in the Company's history that we financed the uninsured portions of our SBA 7(a) government-guaranteed loans in two separate transactions within the same calendar year.  The dramatic growth in our loan origination volume in 2013 over previous years, created the need to issue two separate financings, which we have chosen to combine into one issuance.

Sloane continued, "Securitizations provide an attractive form of non-recourse financing and the collateral and securities issued are match-funded for term. Issuing securitizations enables us to repay our revolving credit facility with Capital One Bank, N.A., and increases our access to capital and hence the capability to continue to fund more loans for small businesses across all 50 states. In fact, we anticipate increasing our loan origination volume to a range of $230 million to $270 million in 2014 and, as a result, may either issue larger securitizations or come to the market more frequently on a go-forward basis. We want to thank Guggenheim Securities, our placement agent and Capital One Bank, our senior lender, for providing capital for our business."

Newtek Business Services, Inc., The Small Business Authority, is a direct distributor of a wide range of business services and financial products to the small- and medium-sized business market under the Newtek® brand. Since 1999, Newtek has helped small- and medium-sized business owners realize their potential by providing them with the essential tools needed to manage and grow their businesses and to compete effectively in today's marketplace.

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