MISSISSAUGA, ON, March 10, 2026 /CNW/ - goeasy Ltd. (TSX:GSY) ("goeasy" or the "Company"), one of Canada's leading non-prime consumer lenders, announced today that it expects to incur an incremental charge off in Q4 2025 of approximately $178M against gross consumer loans receivable of $5.5B as at December 31, 2025, and a related write down of approximately $55M for loan interest and fees. Total Company net charge offs (including the incremental charge off above) in the quarter are expected to be approximately $331M. The Company also expects a net increase in allowance for credit losses on gross consumer loans receivable in the quarter of approximately $86M compared to the amount reported as at September 30, 2025. Accordingly, the Company is withdrawing its previously issued Q4 2025 outlook and three-year forecast.
Appointment of Permanent Chief Financial Officer
The Company also announced today that Felix Wu, who has served as Interim Chief Financial Officer since September 30, 2025, has been appointed Chief Financial Officer, effective immediately. Mr. Wu most recently served as CFO of KOHO and previously held senior finance leadership roles at President's Choice Financial and Capital One Canada.
Expected Q4 2025 Incremental Charge Off and Loan Loss Provision Increase
The expected incremental charge off of approximately $178M relates to certain loans in the Company's LendCare business. Acquired in 2021, LendCare built its portfolio through third-party merchant-originated loans primarily in the auto and powersports categories. The expected incremental charge off reflects goeasy's determination that all available efforts to drive substantive recoveries on certain late-stage delinquent loan receivables of LendCare have been exhausted. This assessment came as a result of goeasy's focus on improving collections effectiveness throughout 2025 which informed goeasy's view of collectability.
After giving effect to the anticipated incremental net charge offs, the Company expects its net charge off rate for 2025 (full-year) to be approximately 12.9%. Management now expects forward-looking credit performance on LendCare loans to be worse than previously anticipated, leading to the Company's annual net charge off rate to increase to the mid-teens in 2026, before beginning to decline in 2027 and onward.
"We are taking definitive action to rectify this situation, and we recognize that LendCare's recent rapid growth calls for robust operational infrastructure, enhanced credit risk management practices as well as strong and disciplined management," said Felix Wu, goeasy's Chief Financial Officer. "We expect pressure on net charge offs and higher delinquency reporting for the coming quarters, before an anticipated improvement in 2027, and we will provide more detail when we report our Q4 2025 earnings."
Although the anticipated incremental net charge offs and increase in loan loss provision is expected to result in the Company not complying with certain financial covenants, as currently formulated, under its syndicated credit facility, securitization facilities and receivables purchase arrangements, the Company has entered into an accommodation agreement with the lenders under its syndicated credit facility and is in active discussions with these lenders as well as with the counterparties under its securitization facilities and receivables purchase agreements. The Company anticipates ...
