Home Capital Group Inc. said clients continue to pull their demand deposits from the alternative mortgage lender’s subsidiary, with $29o million in withdrawals from high interest savings accounts on Thursday alone.
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That’s on top of the $472 million drop in demand deposits — which help Home Capital fund mortgage lending — at its subsidiary Home Trust on Wednesday, the Toronto-based company said in a statement, as concerns mount about the company’s ability to fund its operations going forward.
Shares of Home Capital rose nearly 34 per cent on Thursday to close at $8.02 in late trading in Toronto, partially recouping the 65 per cent it lost on Wednesday. Friday morning, the shares fluctuated from a high of $8.52 to a low of $7.71.
Home Capital expects to have $521 million in high interest savings account deposit balances on Friday, after the settlement of Thursday’s transactions. That’s down 63 per cent from the $1.4 billion it stood at on Monday.
A spokeswoman for the Office of the Superintendent of Financial Institutions told the Financial Post in an email on Thursday that it is “continuing to monitor the situation closely.” |