Home Capital Reports Strong Earnings And Dividend Increase: – Yahoo Finance

Net interest income on the non-securitized portfolio continued its increasing trend reaching $104.9 million in the quarter and $207.8 million year to date, up 15.4% and 16.0% from the comparable periods of 2013 and up 2.0% from last quarter, reflecting strong and consistent growth in the traditional portfolio. Securitized net interest income declined to $10.2 million in the quarter and $17.8 million year to date, from $11.6 million and $25.3 million in the comparable periods of 2013, consistent with the Company’s business strategy to replace net interest income with gains on sale of insured mortgages (please see below). Net interest margin (TEB) was 2.26% in the quarter and 2.23% year to date, up from 2.14% and 2.15% in the comparable periods of 2013 and up from 2.19% last quarter. Net interest margin (TEB) continues to be favourably influenced by the relative shift to higher yielding mortgages on balance sheet, partially offset by lower spreads on traditional uninsured single family mortgages. This is reflective of higher average credit quality on new originations over the past year and higher overall average levels of liquidity. Additionally, prepayment penalties on insured multi-unit residential mortgages during the quarter contributed to the increase in overall net interest margin. Securitization income, including gains on sale mentioned above, was $7.5 million for the quarter and $16.2 million year to date compared to $0.5 million and $2.0 million in the comparable periods of 2013 and $8.7 million last quarter. http://finance.yahoo.com/news/home-capital-reports-strong-earnings-210000054.html

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