Goeasy Secures Debt Covenant Relief After Major Charge-Off
Goeasy secured lender waivers to avoid breaching covenants after a major charge-off. The relief helps the firm avoid raising equity as it re-orients its plan.
goeasy Ltd., a prominent non-prime consumer lender in Canada, announced on Tuesday that it has successfully secured waivers from its lenders regarding specific financial covenants for the fourth quarter. This development follows the company's disclosure of significant charge-offs and write-downs that had previously threatened its compliance with existing loan agreements.
Shares of the Ontario-based firm rose 4% in morning trading as the relief package helps the company avoid a potentially dilutive equity raise. The lender had faced the risk of breaching several covenants after reporting approximately C$178 million ($129.61 million) in charge-offs and write-downs related to its LendCare unit. The stock has faced significant pressure this year, declining nearly 70% prior to this announcement.
