Canada’s housing agency said its net income after taxes rose to C$446 million ($424 million) in the second quarter.
Net income rose 35 percent in the three months ended June 30, while the outstanding balance of mortgage insurance fell less than 1 percent to C$562 billion, Canada Mortgage & Housing Corp. said today in a financial report on its website.
CMHC will inform financial institutions soon about individual caps on the amount of mortgage-backed securities the agency will guarantee, Wojo Zielonka, CMHC’s vice president of capital markets in Ottawa, told reporters on a conference call after the report was released.
Government-owned CMHC guarantees pools of mortgages that financial institutions repackage as securities sold to investors. The Canadian government, rated AAA by Standard & Poor’s and Moody’s Investors Service Inc., backs the CMHC guarantee.
CMHC said this month it will ration the amount of the securities it guarantees. The agency’s move may increase mortgage rates charged by Canada’s largest banks by between 15 and 45 basis points, National Bank Financial Inc. analyst Peter Routledge said in an Aug. 5 research note.
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