Newtek Joins Russell Index, Partners with GE Commercial Finance

NEW YORK – Over the course of one week, Newtek Business Services, Inc. made two major announcements as it continued making headway within the credit union industry. On June 28, NKBS, which is a direct distributor of business services to the small to medium-size business market and has a partnership with CUNA to deliver them to credit unions, joined the newly-created Russell Microcap(TM) Index. The new listing was created on June 24 when Russell Investment Group reconstituted its family of U.S. indexes. The index will be comprised of the smallest 1,000 securities in the small-cap Russell 2000(R) Index plus the next 1,000 companies, based on a ranking of all U.S. equities by market capitalization. Russell indexes are widely used by investment managers and institutional investors for index funds and as benchmarks for both passive and active investment strategies. More than $2.5 trillion in assets currently are benchmarked to them. Investment managers who oversee these funds purchase shares of member stocks according to that company’s weighting in the particular index. “We are thrilled about being added to the Russell Microcap Index,” said Barry Sloane, NKBS chairman and CEO. “We believe that this news will further enhance the liquidity of NKBS and bring additional retail and institutional buyers into our stock.” In other company news, on July 5, Newtek Small Business Finance, Inc. signed a $75 million dollar commitment with GE Commercial Finance for a senior secured revolving line of credit. The agreement will be primarily utilized to originate, accumulate and sell the unguaranteed portions of loans under the SBA 7(a) loan program and for other working capital purposes, according to the company. GE Commercial Finance intends to underwrite the entire $75 million facility and participate out a portion to a to-be-determined group of lenders. The proposed facility is for three years and will replace the existing facility with Deutsche Bank. Closing is subject to documentation and SBA review and approval of the terms and conditions of the facility and is expected to close within the next 30 to 60 days. “The flexibility of the pending new facility, which is subject to customary documentation and regulatory approval, is clearly a benefit to our company over our existing financing arrangement,” Sloane said. “This facility will give NSBF the room to grow and to build our brand among small to medium sized businesses throughout the United States.” NKBS has more than 90 partnerships with credit unions, leagues and CUNA. [email protected]