The Globe and Mail reports in its Tuesday edition that deposits are returning to
Home Capital Group (HCG) as it recovers
from a crisis of confidence.
The Globe's James Bradshaw writes that on Monday, HCG provided
its first liquidity update
since the end of June. At that
time, it was enjoying a renewed
surge of faith from depositors
after securing an investment
worth up to $400-million from Warren Buffett's Berkshire
Hathaway.
In the two weeks since, to July
14, HCG attracted $125-million in net new deposits, the
vast majority of them to guaranteed
investment certificates, or
GICs, with a fixed term.
The high water mark of the so-called
Buffett bounce may have
passed, as HCG said it "has seen deposit
inflows return to historical averages."
Deposit totals have
become a key barometer of HCG's health as well as broader
confidence in the alternative
lending space, after the firm
endured a rare run on the bank
earlier this year. However, the latest figures
show HCG is on firmer
footing after months of woes,
with overall levels of liquidity
moving in the right direction.
HCG still faces a range
of challenges as it tries to originate
new mortgages and chart a
path back to growth.
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