Equitable Banking Group has reported its latest quarterly and half-year results showing strong gains for its Equitable Bank subsidiary.
The bank’s mortgage lending activities showed positive movement with single-family lending mortgage principal up 15% to a record $9.8 billion at June 30, 2018. It reported strong originations growth and higher renewal rates.
Meanwhile, its commercial lending mortgage principal was also up 15%, to $3.3 billion, as origination activity reached an all-time high.
"I am very encouraged with how the Bank is performing" said Andrew Moor, President and Chief Executive Officer. "In November 2017, we expected asset growth in our Alternative Single-Family business to be 2% to 4 % for 2018, but, our expectations have now moved higher to the range of 8% to 10%.”
He added that the lender’s Prime Single-Family business has remained quite stable for the past two years and he hopes to grow its share of that market through the rest of the year.
Quality mortgage portfolio
Equitable’s net impaired mortgage assets were just 0.13% of total mortgage assets at June 20, 2018 compared to 0.16% a year ago.
The allowance for credit losses was 0.12% of total mortgage assets, down in percentage terms from a 0.19% year ago primarily due to low impairment rates and an $8.5 million transitional adjustment as a result of the adoption of IFRS 9 on January 1, 2018.
Equitable Group’s Q2 2018 reported Diluted Earnings per share ("EPS") were $2.19 and reported Return on Shareholders' Equity ("ROE") was 13.0%.
Reported results include a $5.9 million pre-tax write-down of unamortized up-front costs (a $0.26 reduction in EPS and a 1.5 percentage point reduction in ROE) associated with reducing the size and costs of the Bank's secured backstop funding facility.
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