With the ouster of Martin Reid as the channel lender’s president and CEO, shareholder Bonita Then takes his spot. These are five facts brokers need to know.
“Home Capital requires leadership that can bring to bear a renewed operational discipline, emphasis on risk management and controls, and focus on improving performance,” Kevin P.D. Smith, chair of the board of directors at Home Capital, said. “Our solid balance sheet, excellent market position and innovative products provide a strong foundation. Under the right leadership, the company can build on that to create more value for our customers, shareholders, employees and other stakeholders. Our goal is to identify the right leader for the company as soon as possible.”
Reid was appointed president and CEO just over a year ago
On March 11, 2016, MortgageBrokerNews.ca spoke with Reid about his recent appointment, which followed Gerald Soloway’s decision to step down. Reid spoke of optimism for the year ahead as well as the need to restore the lender’s image following a controversy that saw the lender sever ties with brokers who allegedly falsified client documents.
“I think 2015 for us was a bit of a bump in the road,” Reid told MortgageBrokerNews.ca at the time. “We view it as just that; the whole broker fraud thing does not translate into losses and there was a lot of concern about that at the beginning of the year. 2016 is about getting back on track, getting back to the brokers in terms of service. Being back and being back much stronger.”
Home Capital shares fall
The monoline lender’s shares fell 9% at around 11am Tuesday morning.
Home hit with OSC notice
The lender announced earlier this month that it had been notified of an Ontario Securities Commission notice related to the company’s disclosure in 2014 and 2015 of the impact of the falsified loan applications.
That notice did not factor in to the company’s decision to fire Reid.
“We were notified that the decision and timing was not related to issues related to the OSC, but rather the board's desire to take decisive action to have leadership in place to get Home Capital back on track,” Scotiabank Analyst Phil Hardie wrote in a client report, per BNN.
Then is a longstanding board member
Bonita Then, recently appointed interim CEO, has served on the board since 2008. She is the retired president and CEO of Specialty Foods Limited, an American-based food company.
Reid also removed from board
“The Board of Directors has terminated the employment of Mr. Reid as president & chief executive officer, effective immediately, and removed him from the Boards of Directors of the Company’s subsidiaries, including Home Trust
,” Home said in a release.
Home Trust responds to suit
Profile: Home Trust’s new executive