Strong performance during the first three months of the year gave First National Financial LP crucial momentum that kept its fundamentals stable despite the economic ravages of the coronavirus.
The first quarter saw the lender’s single-family originations increase by 53% and renewals go up by 20%, CMT reported.
“We attribute this growth to a strong economy in January and February, prior to COVID-19, and our growing market share,” said Moray Tawse, executive VP with First National.
On the other hand, the lender’s net income saw its first-ever quarterly loss during Q1, decreasing by $2.3 million.
And with the pandemic continuing to inflict unprecedented damage on Canadian finances and purchasing power, First National is bracing itself for harder months ahead, said CEO Stephen Smith.
“[However], while we expect origination volumes to decline for the remaining year, this is tempered by the wider spreads that we are earning on our new originations,” Smith said. “While we expect originations to slow, First National is able to underwrite a record volume of new commitments for customers in March, which will be reflected in second quarter volumes.”
Also, continuity is all but assured as more than 90% of First National’s workforce began working remotely starting mid-March.
“Since the start of the pandemic, we have not lost a step in either the single-family or commercial segments,” Smith said. “We’ve continued to renew mortgages and to lend on both insured and a conventional basis. … The biggest challenge to our business has been providing mortgage payment deferrals.”