KUALA LUMPUR (Dec 5): Evergreen Max Cash Capital Bhd (KL:EMCC) said it has secured a RM50 million short-term revolving credit facility from Bank Islam Malaysia Bhd (KL:BIMB) for its pawnbroking business.

The facility will be used to finance the cash capital requirements of the group's wholly owned subsidiary Evergreen Cahaya Holdings Sdn Bhd (ECH), which undertakes the group’s pawnbroking activities, according to a filing with Bursa Malaysia on Friday.

Short-term revolving credit facilities in the pawnbroking industry usually refer to a flexible borrowing line that allows a pawnbroker to draw, repay and redraw funds as needed. Such facilities enhance liquidity by enabling a company to issue new pawn loans and meet redemption demands, both of which require substantial cash availability.

Evergreen Max said the RM50 million facility will be secured by a debenture incorporating fixed and floating charges over pawned loans receivables and interest receivables, and an assignment and charge over designated accounts.

It will also be secured by an undertaking from the controlling shareholders to maintain their controlling stake, and an undertaking for ECH to remain a wholly owned subsidiary.

Upon full drawdown, Evergreen Max’s total borrowings will rise to RM162.84 million from RM112.84 million as at end-2024.

The group expects the utilisation of the facility to contribute positively to earnings for the financial year ending Dec 31, 2026, as the formal facility agreement is expected to be executed in the first quarter of 2026.

Listed on the ACE Market in September 2023, Evergreen Max is involved in pawnbroking, gold retail and trading, and provides consultancy and IT solutions to other pawnbroking operators.

Shares in Evergreen Max closed half a sen or 1.43% lower at 34.5 sen on Friday, valuing the group at RM381.04 million. Year to date, the stock has fallen nearly 5%.