Includes a return to the public asset-backed term market

DALLAS, Oct. 3 /PRNewswire-FirstCall/ -- Alliance Data Systems Corporation (NYSE: ADS), a leading provider of loyalty and marketing solutions derived from transaction-rich data, today announced that its private label credit card banking subsidiaries successfully completed new funding facilities totaling $1.4 billion, which spanned the public, private, short-term and term asset-backed markets.

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The facilities vary in maturity from one to multi-year terms and comprise both fixed term funding as well as variable rate funding. The entire $1.4 billion will be available to fund the Company's private label credit card portfolio and will replace all remaining facilities that were set to expire by the end of 2008.

Ed Heffernan, Alliance Data's chief financial officer, commented, 'We've successfully cleared the Company's final liquidity hurdle for this year, positioning us well for 2009. While we will expect some headwinds from incremental funding costs in 2009 of about $25 million, it's a worthwhile trade-off to lock down both needed and additional liquidity. In fact, it will not materially change the Company's guidance given that it represents just over 3 percent of our expected 2009 operating EBITDA.

'More importantly,' Heffernan continued, 'even if we account for the significant repurchases of the Company's stock thus far this year, we still have $2.4 billion in available liquidity, and the Company's leverage ratio remains low at only 2x net core debt to LTM operating EBITDA. Lastly, as is customary for us, we will continue to watch the capital markets for opportunities to further enhance our liquidity cushion, maintain strong visibility and/or add accretion to earnings through repurchases.'

In addition to public market investors, the following institutions made significant commitments toward the non-public facilities: RBS Greenwich Capital, RBC Capital Markets, Barclays Capital, Wachovia Securities and JP Morgan.

From a funding cost perspective, the higher spreads required in the current macro environment resulted in a higher weighted average cost of funds, which will add $25 million of incremental funding costs to 2009, should the Company decide to utilize the full $1.4 billion facility.