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DBRS: Home Capital still under review, but with positive implications

DBRS on Aug. 9 revised its review of Home Capital Group Inc.'s and subsidiary Home Trust Co.'s ratings following their second-quarter earnings report.

The Canadian entities are still under review, but now with positive, instead of negative, implications. The review focuses on Home Capital's ability to get more funding "at more reasonable costs" and to "return to sustainable profitability." Home Capital could be upgraded "one or more notches."

The change reflects the Toronto-based lender's "solid progress in restoring market confidence." Its aggregate liquidity and credit capacity has improved to C$3.94 billion as of Aug. 1, from July 14's C$2.57 billion and June 29's C$1.53 billion. In July, Home Capital paid back the outstanding balance on its Berkshire Hathaway credit facility and named Yousry Bissada to the full-time CEO post. In June, it reached agreements to settle its case with the Ontario Securities Commission and a class-action lawsuit.