Gordon J. Reykdal, CEO of Cash Store Financial is taking home nearly $2.3 million in pay and bonuses this year thanks to record profits in the payday loan industry. His son, Barret J. Reykdal, who serves as president of the company, earned $720,761. The information is contained in a management information circular released this week.
As of September 1st, the publicly traded company had 22 payday outlets in Nova Scotia, more than half the provincial total. It operates under the names The Cash Store and Instaloans and charges $31 per $100 on its short-term loans, the maximum allowed under Nova Scotia regulations. A recent Coast cover story reported that people who borrow $300 at that rate would have to repay $393 out of their next paycheque.
Cash Store Financial released figures last month showing the Alberta-based company took in record quarterly revenues of nearly $50 million in the three months ending September 30th — up almost 20 percent over the year before. The company’s net income in the same period was up 37.5 percent to $7.7 million from $5.6 million the year before. The figures also showed that the company opened 120 new outlets in just over a year for a Canada-wide total of 544.
Last month during public hearings on the payday loan industry, Gordon Reykdal urged the Nova Scotia Utility and Review Board not to lower the $31 per $100 maximum rate — the highest in the country. Consumer advocate David Roberts argued that Nova Scotia should adopt the Ontario rate of $21 per $100. So far, the UARB has not released its decision. Money Mart, The Cash Store’s main competitor, charges $19.50 per $100.
A rate of $31 works out to more than 800 percent in annual interest and fees compared to an annual rate of around 36 percent on credit card advances, 21 percent for bank account overdraft protection or 10 percent on a bank line of credit.
