Home Capital Group Reports Lower Q1 2022 Earnings, Record Origination Levels
Home Capital Group Inc. (HCG or the Group) reported Q1 2022 net income of $44.7 million, a 15% decline quarter over quarter (QOQ), primarily owing to lower net interest income and increased operating expenses. Net interest margin (NIM) for the Group continued its downward trend and declined by 28 basis points (bps) from the linked quarter to 2.18% as a result of recent interest rate hikes by the Bank of Canada, which have led to narrowing spreads between loans and deposits. Moreover, as a result of negative operating leverage, HCG's efficiency ratio deteriorated by 580 bps sequentially to 51.7%.Home Capital Group is a holding company that operates primarily through its principal subsidiary, Home Trust Company, which provides insured and uninsured deposits, residential and non-residential commercial mortgage lending and consumer lending. Co. also conducts business through its wholly owned subsidiary, CFF Bank, a Canadian retail bank. Co.'s subsidiary, Payment Services Interactive Gateway Inc. (PSiGate) provides payment card services. Licensed to conduct business across Canada, Home Trust has offices in Ontario, Alberta, British Columbia, Nova Scotia, Quebec and Manitoba.
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