Exhibit 99.1

SquareTwo Financial Announces First Quarter 2011 Results

DENVER, May 12, 2011 —SquareTwo Financial Corporation, a leader in the $100 billion asset recovery and management industry, today reported consolidated financial results for the first quarter ended March 31, 2011.

“We had an exceptionally strong first quarter, including the best collection month on our owned portfolios in the company’s history.  Also, we are seeing clear evidence that our major operational initiatives are producing sustainable financial results.  Most significantly, first quarter performance by our franchise partners exceeded our expectations” explained President and CEO, Paul A. Larkins.

For the first quarter of 2011:

·                  Cash proceeds on purchased debt were $108.3 million, a 20% increase over the $89.9 million in the same period of the prior year.

·                  Investment in purchased debt was $63.6 million, to purchase $928.2 million in face value of debt, compared to $39.3 million, to purchase $933.6 million in face value of debt in the same period of the prior year.  The total investment in Purchased Debt was a 61.8% increase from the same period of the preceding year.

·                  Revenue recognized on purchased debt was $54.7 million, a 31.8% increase from the $41.5 million in the same period of the prior year.

·                  Total purchased debt operating expenses were $36.9 million, a 40.5% increase over the $26.2 million in the same period of the prior year.  Total purchased debt operating expenses per dollar of total purchased debt collections decreased to 35.5%, compared to 37.5% in the same period of the prior year.

·                  EBITDA was $8.7 million in the first quarter of 2011, an 11.9% increase when compared to $7.8 million in the same period of the prior year.

·                  Net loss was $5.2 million, compared to net loss of $2.5 million in the same period of the prior year, due to non-cash allowance charges for certain 2007 and 2008 pools of owned debt.

·                  Adjusted EBITDA, defined as net income before interest, taxes, depreciation and amortization, valuation allowances and amortization of purchased debt, and certain adjustments, was $63.4 million, a 12.7% increase over the $56.3 million in the same period of the prior year.

Supplemental Information to reconcile Net loss to Adjusted EBITDA

(1)           Cash proceeds applied to the carrying value of purchased debt rather than recorded as revenue.

(2)           Non-cash amortization of a step-up in the carrying value of certain purchased debt assets related to purchase accounting adjustments resulting from the 2005 acquisition of us by CA Holding.

(3)           Represents changes in non-cash valuation allowances on purchased debt.

(4)           Represents the non-cash expense related to option grants of CA Holding’s equity granted to our employees and franchisees.

(5)           Consistent with the covenant calculations within our revolving credit facility, Other includes franchise note reserves, lease breakup costs, certain consulting fees, management fees paid to KRG Capital Management L.P., certain transaction expenses, executive recruitment, and severance expense.

Additional Financial Information:

·      In the first quarter of 2011, the Company recorded non-cash purchased debt allowance charges of $5.9 million, compared to $7.3 million in the same period of the prior year.

Conference Call

The Company will hold a conference call today at 8:30 AM Mountain time/ 10:30 AM Eastern time to discuss our first quarter 2011 results.  Please download our Q1 2011 Financial Results Presentation which is located under the About Us header within the Investor Relations section of our website, www.squaretwofinancial.com.

Members of the public are invited to listen to the event.  To access the live telephone conference line, please dial 877-522-6079 for domestic access, and 706-643-9734 for international access.  Please reference confirmation code #60839707 for the call.

For those who cannot listen to the live broadcast, a replay will be available shortly thereafter within the Investor Relations section of the Company’s website.

Non-GAAP Financial Measures

Adjusted EBITDA, as presented in this report, is a supplemental measure of our performance that is not required by, or presented in accordance with, accounting principles generally accepted in the U.S. (“GAAP”). This is not a measurement of our financial performance under GAAP and should not be considered as alternatives to net income or any other performance measures derived in accordance with GAAP, or as alternatives to cash flows from operating activities or a measure of our liquidity.

Adjusted EBITDA is calculated as net income before interest, taxes, depreciation and amortization (including amortization of the carrying value on our purchased debt), as adjusted by several items discussed more fully in ““Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our quarterly report on form 10-Q as of March 31, 2011.  Adjusted EBITDA generally represents cash proceeds on our owned charged-off receivables plus the contribution of our other business activities less operating expenses (other than non-cash expenses, such as depreciation and amortization) as adjusted. Adjusted EBITDA, which is a non-GAAP financial measure, should not be considered an alternative to, or more meaningful than, net income prepared on a GAAP basis.

We present Adjusted EBITDA because we consider it to be an important supplemental measure of our performance. We believe Adjusted EBITDA is representative of our cash flow generation that can be used to purchase charged-off receivables, pay down or service debt, pay income taxes, and for other uses. We believe that Adjusted EBITDA is frequently used by securities analysts, investors and other interested parties in the evaluation of companies in our industry. In addition, the instruments governing our indebtedness use Adjusted EBITDA to measure our compliance with certain covenants and, in certain circumstances, our ability to make certain borrowings. Our board of directors and management use Adjusted EBITDA to measure our performance, and our current management incentive compensation plans are based largely on Adjusted EBITDA. Adjusted EBITDA, as computed by us, may not be comparable to similar metrics used by other companies in our industry.

The SEC has adopted rules to regulate the use in filings with the SEC and public disclosures and press releases of non-GAAP financial measures, such as Adjusted EBITDA, that are derived on the basis of methodologies other than in accordance with GAAP. The non-GAAP financial measures presented in this report may not comply with these rules. The reader is cautioned not to place undue reliance on Adjusted EBITDA and ERP.

The information in this subsection is a summary and should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and footnotes in our 10-Q as of March 31, 2011.