Major Financial Institution Purchases Auto Loans from E-LOAN Auto Fund One,
LLC, a Qualified Special Purpose Entity of E-LOAN, Inc.;
Transaction Increases E-LOAN Cash Balance by $15 Million and Generates an
Approximate $2.5 Million Gain
PLEASANTON, Calif., April 5 /PRNewswire-FirstCall/ -- E-LOAN(R)
(Nasdaq: EELN), an online consumer direct lender, today announced that on
March 30, 2005 a major financial institution purchased substantially all of
the auto loans held by E-LOAN Auto Fund One, LLC, a qualified special purpose
entity of E-LOAN, Inc. The unpaid principal balance of these loans totaled
approximately $651 million. E-LOAN, Inc. received net cash proceeds from this
transaction of approximately $15 million and will record a first quarter 2005
gain on this transaction of approximately $2.5 million. The gain represents
the excess of total proceeds received over the carrying value of E-LOAN,
Inc.'s retained interest in the purchased auto loans.
"Recent strong capital markets demand for auto loans enabled this
transaction and resulting gain," said Mark Lefanowicz, President and Chief
Executive Officer of E-LOAN, Inc. "While no formal decision has been made,
the $15 million cash infusion provides flexibility to pursue options such as
loan securitizations or a potential repurchase of our common stock."
E-LOAN, Inc. will continue to fund vehicle loans under its existing
vehicle warehouse line of credit and will continue to sell funded loans to
whole loan purchasers for cash. While the specific credit facility used to
fund E-LOAN Auto Fund One's purchase of vehicle loans from E-LOAN, Inc.
terminated on March 30, 2005 with the closing of this transaction, E-LOAN,
Inc. intends to enter into a new credit facility agreement by the middle of
April 2005. E-LOAN Auto Fund One retained approximately $2.1 million in
assets, predominantly delinquent and nonperforming vehicle loans (net of
allowances for loan losses). Effective March 30, 2005, E-LOAN Auto Fund One
became a consolidated subsidiary of E-LOAN, Inc.
About E-LOAN, Inc.
E-LOAN is an online consumer direct lender dedicated to providing
borrowers across the credit spectrum with a more enjoyable and affordable way
to obtain mortgage, auto and home equity loans. By making credit scores freely
available to consumers and integrating them with a suite of sophisticated
advice tools, E-LOAN is pioneering the nascent debt management advice category
-- helping consumers proactively manage their loan portfolios to lower their
overall borrowing costs. The company relentlessly advocates eliminating the
unnecessary processes, fees, hassle, haggle and lack of transparency
traditionally associated with the consumer loan experience. Protecting
consumers' financial privacy is a paramount concern, prompting E-LOAN to
implement industry leading privacy practices and advocate strong consumer
financial privacy protection laws. In June 2004, an independent study
conducted by TRUSTe and The Ponemon Institute ranked E-LOAN as one of the top
20 most trusted companies for privacy in America. E-LOAN was the highest
ranked online financial services company to make the top 20.
Consumers can log onto http://www.eloan.com or call 1-888-E-LOAN-22 to access
E-LOAN's products, services and team of dedicated loan and debt advice
professionals. E-LOAN, Inc. is publicly traded on the Nasdaq National Market
under the symbol EELN. From inception through December 2004, E-LOAN has
originated and sold over $24.1 billion in consumer loans.
This news release contains forward-looking statements based on current
expectations that involve risks and uncertainties. E-LOAN's actual results may
differ from the results described in the forward-looking statements. Factors
that could cause actual results to differ include, but are not limited to,
general conditions in the mortgage and auto industries, interest rate
fluctuations, and the impact of competitive products. These and other risk
factors are detailed in E-LOAN's periodic filings with the Securities and
Exchange Commission.
CONTACT: Laurie Azzano of Cosmo Public Relations, +1-504-296-1349, or
laurie@cosmo-pr.com, for E-LOAN; or Tiffany Fox of E-LOAN,
Public/Investor, +1-925-847-6314, or tiffanyf@eloan.com.
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