Canadian

subprime lender

Goeasy Ltd. suspended its dividend, withdrew its outlook and said it will write off an additional $233 million in

consumer loans

, interest and fees. The shares plunged as much as 39 per cent.

The problems stem from

loans for autos

and “powersports” equipment, a category that includes items such as all-terrain vehicles. The Mississauga, Ont.-based firm said it expects its net charge-off rate — a measure of loans that it doesn’t expect to collect on — to be just below 13 per cent for last year and to rise into the mid-teens in 2026.

Goeasy said it will make a number of changes, including

reducing new loans

from LendCare, a unit that provides auto and powersports loans, while cutting $30 million in annualized costs.

Management will also correct earlier financial reporting from LendCare to address incorrect treatment of some customer payments. “The impact of this correction to the income statement, balance sheet, statement of cash flows and statement of equity is not material,” it said.

Goeasy was down 39 per cent to $70.01 shortly after the start of trading in Toronto on Tuesday.

Bloomberg.com

  • Auto loan defaults are climbing as high prices and interest rates weigh on Canadians’ wallets
  • More Canadians are ‘underwater’ on their vehicles and may have no idea about it