Home Capital Group Inc. issued its full-year 2018 outlook.
The company, in the near term, will focus on growing residential and commercial mortgage originations, taking back market share and maintaining retention levels.
The C$2 billion credit facility that was provided to Home Capital by a unit of Berkshire Hathaway Inc. matured June 29, and was replaced with a C$500 million credit facility provided by a syndicate of Canadian chartered banks. Home Capital expects this development to have a favorable impact on its 2018 net interest margin in future periods, compared to the cost of the matured credit facility.
Compared to periods prior to the second quarter of 2017, the company anticipates its net interest margin will be negatively impacted from the commercial mortgage portfolio sale closed in the third quarter of 2017, reduction in relatively lower cost demand deposits as a percentage of total deposits and the standby credit facility.