MCAN’s primary objective is to generate a reliable stream of income by investing in a diversified portfolio of Canadian mortgages focused on single-family residential mortgages and residential construction loans, as well as other types of loans and investments, real estate and securitization investments.
MCAN’s business model provides focused investing in products and markets where MCAN has extensive expertise to generate attractive financial returns. MCAN’s Board of Directors and Management Team possess significant experience in the financial, investment and real estate industries.
Stable earnings profile
Stable and regular dividend payments. Regular dividend has increased over the past decade and in May 2017 we announced our regular dividend would increase to $0.32 per share. We typically pay out all taxable income as dividends.
Proven investment expertise
High quality portfolio; mortgages in arrears actively managed.
Low cost business model
Ability to use low-cost leverage to generate returns to shareholders. In-house origination capabilities through Xceed (subsidiary acquired July 2013). Variable cost model benefits from strategic MCAP alliance, leveraging MCAP’s staff of over 500. Flexibility to adapt and reposition according to market conditions.
Strong Capital Position
Common Equity Tier 1, Tier 1 and Total Capital Ratios well in excess of OSFI minimum requirements. Preservation of capital is MCAN’s primary core value.
MCAN is a strategic investor in the Canadian real estate market. Our portfolio is focused on uninsured single-family mortgages and residential construction loans where we have proven investment expertise. Our exposure to the residential construction market provides in-depth knowledge of the regions that we invest in to support the uninsured single-family portfolio.
Leverage from CDIC-eligible term deposits provides a cost-effective source of funding for our investments. Yield from the investing operations provides returns to shareholders via distributions that are made tax efficient through MCAN’s mortgage investment corporation (MIC) structure. The basic characteristics of a MIC are:
- Investment platform focused primarily on residential mortgage lending
- Taxable income distributed directly to shareholders
- Effectively a non-taxed flow-through entity
- Majority of dividends received by shareholders taxed as interest income
- Attractive investment option for tax-exempt institutions, in addition to tax-deferred and tax-free investment accounts (RRSP, RESP, and TFSA)
The following analysts provide research coverage on MCAN Mortgage Corporation:
Catalyst Equity Research Inc. – Robin Cornwell
National Bank Financial – Jaeme Gloyn