Grey Horse Corporation

Grey Horse Corporation

January 27, 2010 17:44 ET

Grey Horse Applies to Expand into Residential Mortgage Business

Industry veteran Nick Kyprianou to lead new business line

TORONTO, ONTARIO--(Marketwire - Jan. 27, 2010) - Grey Horse Corporation (TSX:GHC) ("Grey Horse" or "the Corporation"), a Canadian financial services firm, announced today that its subsidiary, Equity Transfer & Trust Company (ETT), is taking steps to enable it to become a deposit-taking institution (DTI). As a DTI, ETT intends to begin taking deposits and enter the growing field of residential mortgage lending – a $950 billion market. 

The Corporation also announced today that Nick Kyprianou will join the firm on February 1, 2010 as President, Mortgage Operations and will lead the DTI initiative. In order to align his interests with those of the Corporation, Mr. Kyprianou will also invest approximately $1 million to purchase GHC common shares at $5.25 per share via a private placement, which is scheduled to occur on or before January 28, 2010 and is subject to the receipt of all required stock exchange approvals.

Grey Horse's strategic plan calls for growth through diversification into financial services that are adjacent and complementary to the Corporation's existing operations. By leveraging ETT's current regulatory status, trust charter, and financial and technology infrastructure, Grey Horse believes that its expansion into the business of mortgage lending and deposit-taking is an attractive opportunity with the potential to significantly enhance the Corporation's growth.

In order to become a DTI, ETT is required to obtain various regulatory approvals. The process also requires ETT to become a member of the Canada Deposit Insurance Corporation (CDIC), as deposits with ETT must be CDIC-insured. There is no guarantee that regulatory approvals will be obtained.

Grey Horse President & CEO Paul G. Smith said, "We are excited by this opportunity and by Nick Kyprianou joining our management team. This initiative fits with our strategic direction by expanding the scope of ETT's trust business, generating a new revenue stream for the Corporation and further diversifying GHC's activities in the financial services sector. Mr. Kyprianou is a strong and respected business leader whose many years of industry experience position the Corporation well to build a competitive mortgage lending business."

About Nick Kyprianou
Nick Kyprianou is the former President of a major financial institution where he worked for 17 years until the end of 2009 and was responsible for directing mortgage underwriting, sales and Visa operations. Mr. Kyprianou said, "I am delighted to be joining Grey Horse at this juncture in its evolution and am committed to this strategic initiative. Having watched Grey Horse's progress over the years, I am impressed with its management team and growth prospects, and confidently invest my own personal capital in the Corporation's future."

About residential mortgage lending
The Canadian residential mortgage market is $950 billion and growing at an average annual rate of 7 to 9 percent. ETT plans to focus on alternative residential mortgages, a segment which represents 10% of the total mortgage market and is underserved by major financial institutions yet provides a tremendous opportunity for top and bottom line growth. Alternative residential mortgages are loans to borrowers who do not conform to major banks' standards of creditworthiness. Such mortgages are typically granted to self-employed business people, immigrants and borrowers with imperfect credit histories, and are often more profitable than insured mortgages. Lenders mitigate risk by securing the loans with title to the property. ETT plans to partner with mortgage brokers, who collectively originate approximately 30% of all residential mortgages, and use deposit brokers and financial planners to generate deposits.

Analyst Conference Call Grey Horse will hold a conference call for analysts and investors on Thursday, January 28, 2010 at 10am EST to discuss this new strategic initiative and answer questions. Participants may dial in locally at 416-340-8018 or toll-free at 866-223-7781. A replay of the call will be available by dialling 416-695-5800 or 800-408-3053 (Passcode: 8213200) up to midnight February 26, 2010.

About Grey Horse Through its wholly owned subsidiaries, Grey Horse provides transfer agent, corporate trust, corporate secretary, foreign exchange and limited market dealer services to corporations in North American capital markets. Learn more at

Advisory notes: Certain information included in press releases may be forward-looking and involve risks and uncertainties. The results or events predicted in such statements may differ materially from actual results or events. Factors that might cause a difference include, but are not limited to, failure to obtain approval to become a deposit-taking institution on favourable terms or at all, failure to complete the private placement, competitive developments, risks associated with Grey Horse's growth, the state of the financial markets, frequency of large volume transactions, regulatory risks and other factors. If and when forward-looking information is set out in this press release, Grey Horse will also set out the material risk factors or assumptions used to develop the forward-looking information. Forward-looking information will be updated as required pursuant to the requirements of National Instrument 51-102. More detailed information about potential factors that could affect Grey Horse's financial and business results is included in public documents Grey Horse files from time to time with Canadian securities regulatory authorities.

The Toronto Stock Exchange has neither approved nor disapproved the contents of this press release.

Contact Information

  • Grey Horse Corporation
    Kevin Reed
    (416) 361-0930
    Grey Horse Corporation
    Paul G. Smith
    President & CEO
    (416) 361-0930