Coventree loan maker cuts staff 30 percent

Toronto -- Unconventional loan maker Coventree Inc. said Tuesday it would cut its staff by 30 percent, or 25 jobs, and close its Denver office due to credit problems.

The firm said it was "unable to predict" how the severe credit crunch stemming from the U.S. subprime mortgage financial crisis would affect its "financial results, business, operations and financial condition, including any impairment of assets in future periods."

The staff cuts will cost Coventree -- which specializes in cash-flow financing where little or no collateral is involved in the loan -- about $1 million in severance and other costs, to be recorded in the current quarter, ending Sept. 30, the Toronto company said.

Coventree shares were down 6 cents, or 5.13 percent, to $1.11 in mid-afternoon trading on the Toronto Stock Exchange.

The shares were worth $12.98 Aug. 10.

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Copyright 2007 by United Press International.