Home Capital Announces Closing of Residential Mortgage Backed Securities, Series 2021-1



TORONTO – (COMMERCIAL THREAD) – Home Capital Group Inc. (“Home Capital”) (TSX: HCG) and its subsidiary Home Trust Company (“Home Trust”) announce the closing of a previously disclosed private placement of residential mortgage-backed securities ( “RMBS”) issued by Classic RMBS Trust (the “Series 2021-1 Notes”), a securitization vehicle sponsored by Home Trust. The Series 2021-1 Notes are backed by a portfolio of uninsured and close to premium residential mortgages and are comprised of Tranches A, B and Z totaling $ 400 million.

Tranche A of $ 340 million was sold to accredited investors in Canada and qualified institutional buyers in the United States. The remaining $ 60 million, consisting of Tranches B and Z, has been kept by Home Trust.

Tranche A is rated AAA (sf) by DBRS and Aaa (sf) by Moody’s. It was valued at a spread of 110 basis points on the Government of Canada comparable term bond curve, which equates to an annual interest rate of 1.433%.

“The performance of our inaugural 2019 RMBS offering has resulted in strong demand for these notes by a broad group of Canadian and US institutional investors,” said Brad Kotush, executive vice president and chief financial officer of Home Capital. “The reception given to this offer by the market confirms our conviction that we can develop this financing channel by issuing other RMBS on a sustainable programmatic basis.

The Series 2021-1 Notes will not be eligible for distribution to the public under the securities laws of any province or territory of Canada and may not be offered or sold in Canada, directly or indirectly, otherwise. than under the applicable private placement exemptions. The Series 2021-1 Notes are not and will not be registered under the US Securities Act of 1933, as amended (the “Securities Act”), and may not be offered or sold in the United States in the United States. no registration or applicable exemption from the registration requirements of the Securities Act. Series 2021-1 Notes are being offered by way of a private placement, only to persons reasonably suspected of being Qualified Institutional Purchasers under Rule 144A under the Securities Act, or outside of the United States. United to persons other than “US persons” in accordance with Regulation S under the Securities Act. This press release does not constitute an offer to sell or the solicitation of an offer to buy the Series 2021-1 Notes in any jurisdiction, nor an offer to buy.

Caution Regarding Forward-Looking Statements

From time to time, Home Capital Group Inc. makes written and oral forward-looking statements. These are included in the annual report, periodic reports to shareholders, regulatory documents, press releases, Company presentations and other Company communications. Forward-looking statements are made in connection with business objectives and targets, company strategies, operations, anticipated financial results and prospects for the company, its industry and the Canadian economy. These statements regarding expected future performance are “financial outlook” within the meaning of NI 51-102. Please review the risk factors, which are described in detail in the Risk Management section of the First Quarter 2021 Report, as well as the Company’s other public information, which is available on the Electronic Document Search and Analysis System. (SEDAR) at www.sedar.com, for material factors that could cause the Company’s actual results to differ materially from these statements. These risk factors are important risk factors that a reader should consider and include credit risk, liquidity and funding risk, structural interest rate risk, operational risk, credit risk. investment, strategic risk, reputational risk, compliance risk and capital adequacy risk as well as additional risk factors that may affect future results. Forward-looking statements can be found in the report to shareholders and in the Outlook section of the annual report. Forward-looking statements are generally identified by words such as “will”, “believe”, “expect”, “anticipate”, “intend”, “should”, “estimate”, “plan”, “Foresee”, “may,” and “could” or other similar expressions.

About Home Capital: Home Capital Group Inc. is a public company, listed on the Toronto Stock Exchange (HCG), operating through its principal subsidiary, Home Trust Company. Home Trust is a federally regulated trust company that provides residential and non-residential mortgage lending, residential mortgage securitization, consumer loans, and credit card services. In addition, Home Trust offers deposits through brokers and financial planners, and through a direct consumer deposit brand, Oaken Financial. Home Trust also operates through its wholly owned subsidiary, Home Bank. Licensed to do business across Canada, we have offices in Ontario, Alberta, British Columbia, Nova Scotia and Quebec.



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