Home Capital Group has reported its latest quarterly results, revealing positive gains for profits and its mortgage business compared to the previous quarter.
In the three months ended March 31, 2018, the group posted net income of $34.6 million, an increase of 13.0% compared to the fourth quarter of 2017 ($30.6 million). However, compared to the first quarter of 2017, net income was down by 40.4%.
“We have taken another step forward on our journey to renewed growth. We had a good start to the year building on the momentum in our business from the past two quarters and our first quarter results demonstrate that Home is back," said Yousry Bissada, President and CEO, Home Capital Group.
Mortgage originations were up 32.9% to a total $1.16 billion, adding $287.2 million compared to Q4 2017. Despite the growth, originations were 50.1% lower than in the first quarter of 2017.
“We delivered growth in our residential and commercial lending business as result of our constant focus on improving our service to brokers and customers while building a sustainable risk culture,” added Bissadra.
Provision for credit losses as a percentage of gross uninsured loans of 0.20%, compared to 0.12% in Q4, 2017 and 0.16% in Q1, 2017.
Here are the loan stats
Total loans of $15.22 billion increased 1.0% from $15.07 billion at the end of Q4 2017 and decreased 18.1% from $18.58 billion at the end of Q1 2017.
- Single-family residential mortgage originations of $869.7 million compared with $566.0 million in Q4 2017, and $1.71 billion in Q1 2017.
- Multi-unit residential mortgage originations of $104.9 million compared to $194.8 million in Q4 2017, and $294.8 million in Q1 2017. Most multi-unit residential mortgage originations are insured and subsequently securitized through programs that qualify for off-balance sheet accounting.
- Non-residential commercial mortgage originations, which include store and apartment mortgages, of $184.7 million compared to $111.2 million in Q4 2017, and $338.4 million in Q1 2017.
Ready to grow to leading Alt-A lender
"Looking forward, we are ready to grow,” said Bissadra. “Our capital and liquidity position provides flexibility to be competitive in our markets. As we work towards building shareholder value, we are following a responsible growth strategy to be the leading Canadian Alt-A lender, leading in service, technology and market share.”