Home Capital says deposits stabilize after heavy withdrawals

Home Capital Group Inc. said Monday that its client deposit levels have stabilized over the past few days following a string of heavy withdrawals,and that it still has funds available on its line of credit.

The alternative mortgage lender said that as of Friday the balance for itshigh-interest savings accounts stood at approximately $125.4 million, downabout $100,000 from the previous day.

OnMay 1,the balance of the company's high-interest savingsaccounts stood at $324.1million. Back in late March, the company's balance of those accounts stood at about $2 billion.

• Home Capital shares slide 15% as conference call fails to ease investor fears

Meanwhile, the balance of the company's Guaranteed Investment Certificate (GIC) deposits stood at approximately $12.44 billion, while deposits at its Oaken Financial subsidiary stood at $151 million, both down slightly from Thursday.

Home Capital also told the market that it has $600 million remaining undrawn under a$2-billion credit line it arranged with Healthcare of Ontario Pension Plan (HOOPP). Home Capital said its available liquidity and credit capacity stood atapproximately $1.51 billion.

Shares of Home Capital finished flat on Monday, adding three cents to close at $9.17 on the TSX.

• Everything you need to know about Home Capital's woes

The company was forced to secure the line of credit after clients began making big withdrawals from its high-interest savings accounts. Home Capital uses fund from the deposits for its mortgage lending, prompting worries over the company's financial situation as clients pulled out their money.

Back in mid-April, the Ontario Securities Commissionannounced an actioninto how Home Capitalconducted itself several years agowhen numerous mortgages brokers were caught pushing bogus paperworkfor prospective homebuyers.

Over the weekend, the Globe and Mail reported that Bank of Canada governor Stephen Poloz said the central bank doesn't see signs that the problems at Home Capital are spreading elsewhere in the financial system.

"The question would be: What caused this? Is it something unique to the institution itself, or is it something in the system? I think this situation [Home Capital] is pretty clear on that; it's idiosyncratic," the Globe reported Poloz as saying in an interview on the sidelines of Group of Seven meeting of finance ministers and central bankers in Bari, Italy.