Home Capital Agrees with National Energy Corporation on the Early Termination of Financing Arrangements, Including Related Comp

 Home Capital Agrees with National Energy Corporation on the Early Termination  of Financing Arrangements, Including Related Compensation  TORONTO, June 5, 2014 /CNW/ - Home Capital Group Inc. ("Home Capital")  (TSX:HCG) announced today that its wholly owned subsidiary, Home Trust Company  ("Home Trust") has agreed with its customer National Energy Corporation  ("National") on the termination and repayment of financing arrangements  currently totaling approximately $236 million related to National's sales and  rentals of water heaters.  Earlier today, National's parent company, Just Energy Group, Inc., announced  that it has entered into an agreement to sell the shares of National to  Reliance Comfort Limited Partnership (the "Sale Transaction"). In connection  with the Sale Transaction, National and Home Trust will terminate their  financing arrangements.  The termination and repayment will be effective on closing of the Sale  Transaction. The Sale Transaction is subject to, among other things, the  approval of the federal Competition Bureau. The agreement between National and  Home Trust includes compensation to Home Trust for the early termination of  the water heater financing arrangements. Home Trust's compensation is expected  to be in the range of $32 million to $38 million (before tax). This will  compensate Home Trust for interest that would have been received over the  original contractual terms of the financing arrangements, which extended over  a range of periods ending in 2023. Home Trust will continue to provide  financing to National until closing of the Sale Transaction.  At closing of the Sale Transaction, National will repay to Home Trust the  outstanding financing, along with the associated early termination  compensation, which will be recorded in the consolidated income of Home  Capital. The amount of the early termination compensation will depend on the  amounts and remaining contractual terms of the financing arrangements at  closing of the Sale Transaction.  Following that date, no further interest  income from National will be recorded by Home Trust.  About Home Capital and Home Trust  Home Capital Group Inc. is a public company, traded on the Toronto Stock  Exchange (HCG), operating through its principal subsidiary, Home Trust  Company. Home Trust is a federally regulated trust company offering deposits,  residential and non-residential mortgage lending, securitization of insured  residential first mortgage products, consumer lending and credit card  services. Licensed to conduct business across Canada, Home Trust has offices  in Ontario, Alberta, British Columbia, Nova Scotia, Quebec and Manitoba.  Caution Regarding Forward-looking Statements  This press release contains forward-looking information within the meaning of  applicable Canadian securities legislation. Please refer to the Home Capital's  2013 Annual Report, available on Home Capital's website at  www.homecapital.com, and on the Canadian Securities Administrators' website at  www.sedar.com, for Home Capital's Caution Regarding Forward-looking Statements.    SOURCE  Home Capital Group Inc.  Gerald M. Soloway, CEO, or Martin Reid, President, 416-360-4663,  www.homecapital.com  To view this news release in HTML formatting, please use the following URL:  http://www.newswire.ca/en/releases/archive/June2014/05/c2922.html  CO: Home Capital Group Inc. ST: Ontario NI: FIN LOAN MNA  
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