IOU Financial Inc. will begin a restructuring plan in September, 2016, which will reflect the company’s long-term outlook for loan origination growth of 25 per cent to 30 per cent annually.
The plan includes a reduction in the company’s operating expenses as well as a work force restructuring. Moreover, going forward, the company plans to focus more of its efforts on forming strategic partnerships with entities such as financial institutions, payment processors and small business service providers. In connection with the plan, IOU has eliminated its chief technology officer position. The company’s technology team will report to the chief financial officer, and will continue to work closely with the finance, analytics, sales and operations teams. The cost-reduction actions, once fully implemented, are expected to lower operating costs by approximately 15 per cent to 20 per cent to $2.0-million to $2.2-million for fourth quarter 2016 on a normalized basis.
“IOU is committed to achieving profitable growth by continuing to emphasize credit quality over volume and by continuously improving operational efficiencies,” said Phil Marleau, chief executive officer of IOU Financial. “IOU believes that these efforts are imperative to realizing its long-term objective of loan origination growth of 25 per cent to 30 per cent annually.”
About IOU Financial
IOU Financial provides small businesses throughout the U.S. and Canada access to the capital they need to seize growth opportunities quickly. Typical customers include medical and dental practices, grocery and retail stores, restaurant and hotel franchisees and e-commerce companies. In a unique approach to lending, the IOU Financial advanced, automated application and approval system accurately assesses applicants’ financial realities, with an emphasis on day-to-day cash flow trends. It makes loans of up to US$150,000 to qualified U.S. applicants ($100,000 in Canada) within a few business days, with affordable charges favorable to cash-flow management. It’s speed and transparency make IOU Financial a trusted alternative to banks. To learn more visit: IOUFinancial.com.
Forward Looking Statements
Certain information set forth in this news release may contain forward-looking statements that involve substantial known and unknown risks and uncertainties. These forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond the control of IOU Financial including, but not limited to, the impact of general economic conditions, industry conditions, dependence upon regulatory and shareholder approvals, the execution of definitive documentation and the uncertainty of obtaining additional financing. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements. IOU does not assume any obligation to update or revise its forward-looking statements, whether as a result of new information, future events, or otherwise.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
For Further Information:
| Philippe Marleau | David Kennedy |
| Chief Executive Officer | Chief Financial Officer |
| (514) 789-0694 ext. 225 | (514) 789-0694 ext. 298 |