One broker lender has just become stronger – and that’s good for the channel
Group announced earlier this week an injection of capital from OMERS, the pension plan for Ontario’s municipal employees, for common shares of the company for a total of $50 million.
That extra capital has been earmarked for Equitable Bank, one of the channel’s lenders.
“It’s an important investment. $50 million, to be clear, is about 5% of our value, so the bank is worth about $1 billion. It’s still important,” Andrew Moor, president and CEO of Equitable Bank, told MortgageBrokerNews.ca. “A strong foundation of capital and to have an institutional investor that’s as well respected as them putting money into a bank that relies on the mortgage broker channel for all of its mortgages is obviously a reflection the strength of the channel, despite whatever the short-term challenges might be.”
The investment will increase the Bank's Common Equity Tier I capital and provide it with more capacity to fund the growth of its lending businesses, Equitable said in a release.
At a time when some lenders are scaling back – and one has even left the channel – such an investment is a true vote of confidence in the channel and the value mortgage brokers provide.
“Brokers have a strong role to play in the future of the Canadian housing industry,” Moor said. “We definitely see more opportunity ahead, so we thought it was a good time to raise some capital to make sure we can support our broker customers and help them build their businesses over the next year or two. This capital will help.”
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