Covarity Inc.

Covarity Inc.

May 06, 2009 11:39 ET

Covarity Secures Additional Venture Capital Funding to Continue Growth of Commercial Loan Monitoring Solution

Investment, Despite Current Wariness of Venture Capitalists, Recognizes Need for Risk Management Solutions for U.S. Banks

KITCHENER-WATERLOO, ONTARIO--(Marketwire - May 6, 2009) - Covarity Inc., the leading commercial loan portfolio management software provider, today announced that it has received an additional $3 million in venture capital funding from BDC (Business Development Bank of Canada - www.bdc.ca), GrowthWorks (www.growthworks.ca), Tech Capital Partners (www.techcapital.com), and VentureLink Group of Funds (www.venturelinkfunds.com). The proceeds from the financing will help the company continue to extend deployment of its solution, already used by some of the world's leading banks, throughout the U.S. market.

"Covarity's deployment by Canada's leading banks - a market recognized as having the soundest financial institutions in the world - represents a proven way to help financial institutions get back to the basics of consistent, frequent and detailed loan monitoring," said Andrew Abouchar, Partner, Tech Capital Partners. "The U.S. market is in need of such a solution in order to improve risk management and address the process deficiencies highlighted by the credit crisis. We're excited to help Covarity grow and meet this need by extending their proven solution into the U.S. market."

Covarity provides financial institutions with a consistent risk management solution built around precision monitoring of commercial loans. Covarity automates the process for collecting and analyzing financial data from borrowers, bringing consistency, quality assurance and process efficiencies to the commercial lending process. Covarity's innovative SaaS (software as a service) solution helps expose at-risk loans before they become delinquent and reduces risk by facilitating faster and better decision-making and better preparation for increasing regulatory scrutiny.

"Banks in the U.S. have not monitored commercial loans as diligently or frequently as they should have, prompting tighter regulatory scrutiny and more stringent risk management practices," said Rod Foster, President and CEO of Covarity. "We offer financial institutions the only solution that supports the frequency and the depth of analysis that uncovers their true level of risk exposure. This funding will help increase resources to extend our solution to the U.S market, while continuing to meet the needs of the innovative Canadian banks that help us establish industry best practices."

About Covarity Inc.

Covarity is the choice of the best managed banks in the world (as cited by sources such as the World Economic Forum and Global Finance magazine) for precision commercial loan portfolio management. Covarity automates the process for collecting and analyzing borrower financial data and enables financial institutions to manage credit risk on a loan-by-loan basis. Covarity's hosted, Web-based commercial loan monitoring solution delivers process efficiencies, value-added customer service and helps prepare financial institutions for regulatory scrutiny fast and efficiently with minimal capital outlay. Covarity is based in Kitchener, ON and was incorporated in 2001. Covarity's customers include Royal Bank of Canada, BMO Bank of Montreal, HSBC Bank Canada, Libro Financial Group, and RBC Bank in the United States. Please see www.covarity.com for more information.

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