Correcting and Replacing: Contifinancial Enters Charged-off Consumer Receivables Business.NEW YORK--(BUSINESS WIRE)--February 19, 1998--ContiFinancial Corporation (NYSE NYSE See: New York Stock Exchange :CFN CFN Center for Functional Nanomaterials CFN Companhia Ferroviaria do Nordeste (Brazil) CFN Commercial Fueling Network CFN Conselho Federal de Nutricionistas (Brazil) ) has announced the formation of ContiAsset Receivables Management LLC (Logical Link Control) See "LANs" under data link protocol. LLC - Logical Link Control , and ContiAsset's acquisition of Pacific Advisory Services advisory services advisory services provided to the public, in their capacity as owners and managers of animals, are an important part of veterinary science. They may be provided by government bureaux, by commercial companies who deal in pharmaceuticals or animals or animal LLC (formerly known as Alderney Capital Management LLC). ContiAsset, based in San Diego San Diego (săn dēā`gō), city (1990 pop. 1,110,549), seat of San Diego co., S Calif., on San Diego Bay; inc. 1850. San Diego includes the unincorporated communities of La Jolla and Spring Valley. Coronado is across the bay. , will engage in the business of acquiring and securitizing charged-off credit card and other consumer receivables. Pacific Advisory Services, which has been merged into ContiAsset, was a San Diego-based firm specializing in sourcing, pricing and acquiring charged-off consumer receivable portfolios. As one of the premier firms in this industry, Pacific Advisory Services managed the acquisition of over $1.8 billion in face amount of charged-off consumer receivables for its clients during 1997. Pacific Advisory Services was founded by Mitchell Bonilla and Jerry Roxas, who have been active participants in this industry since 1992, when banks and other originators first began to sell charged-off consumer receivables. They have been involved in the purchase of over $4.0 billion in face amount of charged-off consumer receivable portfolios, and will become part of the ContiAsset management team. Concurrent with the acquisition of Pacific Advisory Services, ContiAsset has entered into a strategic alliance with Arrow Service Bureau, Inc. to service and collect non-performing consumer debt sourced by ContiAsset. Arrow, a 36-year old accounts receivable accounts receivable n. the amounts of money due or owed to a business or professional by customers or clients. Generally, accounts receivable refers to the total amount due and is considered in calculating the value of a business or the business' problems in paying management firm headquartered in Chicago, is an experienced collector of charged-off consumer receivables, both as principal and as agent for third-party contingency clients. John Banu, President of ContiAsset, commented, "We expect to manage and finance the acquisition of various classes of charged-off consumer receivables, including private label retail credit cards, automobile loan deficiency balances and other consumer loans. During 1998 we plan to fund at least $1 billion in face amount of charged-off receivables, which should represent not more than a $25 million investment." Michael Valentino, Executive Vice President of ContiAsset, added, "The strategic alliance with Arrow is a perfect complement to our acquisition of Pacific. The combination of these two entities with ContiFinancial's capital markets expertise provides the synergy that will enable ContiAsset to capitalize on Cap´i`tal`ize on` v. t. 1. To turn (an opportunity) to one's advantage; to take advantage of (a situation); to profit from; as, to capitalize on an opponent's mistakes s>. the exciting opportunities that currently exist in this highly fragmented industry." Mr. Banu is Senior Managing Director - Capital Markets, and Mr. Valentino is head of the New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of asset-backed group, of ContiFinancial Services Corporation. Mitchell Bonilla, Vice President of ContiAsset, added, "We are very excited to be an integral part of ContiFinancial's entrance into the charged-off consumer receivable marketplace. ContiAsset's strategic alliance with Arrow will create a highly professional team providing a reliable and consistent funding source for sellers of receivables." ContiFinancial Corporation is a consumer and commercial finance company with headquarters in New York City New York City: see New York, city. New York City City (pop., 2000: 8,008,278), southeastern New York, at the mouth of the Hudson River. The largest city in the U.S. . The Company, through ContiMortgage Corporation and other subsidiaries, is a leading originator, securitizer, and servicer of home equity loans made to borrowers whose needs may not be met by traditional financial institutions. In addition, through ContiTrade Services L.L.C., the Company provides financing and securitization Securitization The process of creating a financial instrument by combining other financial assets and then marketing them to investors. Notes: Mortgage backed securities are a perfect example of securitization. May also be spelled as "securitisation. services and, through ContiFinancial Services Corporation, bond placement services, to originators of a broad range of loans, leases and receivables, including loans for a variety of commercial real estate property types; home equity loans; home improvement loans; prime, sub-prime and non-prime auto loans; franchisee loans; time-share loans and equipment leases. Certain statements contained in this press release, which are not historical fact, may be deemed to be forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. under the federal securities laws. There are many important factors that could cause ContiFinancial Corporation's actual results to differ materially from those indicated in the forward-looking statements. Such factors include, but are not limited to, general economic conditions, interest rate risk, prepayment speeds Prepayment speed Also called speed, the estimated rate at which mortgagors pay off their loans ahead of schedule, critical in assessing the value of mortgage pass-through securities. , delinquency and default rates, changes (legislative and otherwise) in the asset securitization industry, demand for ContiFinancial Corporation's services, the impact of certain covenants in loan agreements of ContiFinancial Corporation and Continental Grain Company, the degree to which ContiFinancial Corporation is leveraged, its needs for financing, the net interest margin securities market, and other risks identified in ContiFinancial Corporation's Securities and Exchange Commission filings. CONTACT: Jerome M. Perelson Allison H. Wey n. 1. Way; road; path. v. t. & i. 1. To weigh. n. 1. A certain measure of weight. Senior Vice President Senior Vice President ContiFinancial Corporation Edelman Financial 212-207-5402 212-704-4424 |
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