Financial stability to help Canadians: CMHC results for first quarter 2020

OTTAWA, May 29, 2020 /CNW/ - As a key contributor to the stability of Canada's housing markets and the financial system, Canada Mortgage and Housing Corporation (CMHC) stands ready to continue to support the economic well-being of Canadians through the COVID-19 crisis and into economic recovery. Details are available in CMHC's quarterly financial report released today.  

"As Canada's national housing agency, we have an important role in supporting Government action and delivering programs that are helping many Canadians get through the economic hardships brought on by the pandemic," said Lisa Williams, CHMC's Chief Financial Officer.

CMHC has also published business supplements on its Mortgage Insurance, Mortgage Funding and Covered Bonds activities, providing additional depth and insights on each.  

Additional quarterly report highlights for three-month period ending March 31, 2020:  

• We acted quickly to support Canadians having difficulty paying their mortgages due to income loss because of COVID-19 by offering temporary deferral of mortgage payments for homeowners and for our multi-unit clients. We also took steps to ensure that non-profit and co-operative housing providers continue to receive federal rent subsidies for low-income tenants.
• We launched the revised Insured Mortgage Purchase Program to provide lenders access to reliable funding to ensure continued lending to Canadians. Under this program, the Government stands ready to purchase up to $150 billion of insured mortgage pools through CMHC, of which $5 billion was purchased by the end of the first quarter.
• We experienced net losses on our financial assets and liabilities in this quarter mainly due to an increase in our expected credit loss provisions due to the economic impacts of COVID-19.
• We experienced an increase in insurance claims expenses mainly due to an increase in the risk of loss for loans in arrears at March 31, 2020 caused by current economic conditions.
• CMHC's overall arrears rate was 0.32%. Payment deferrals related to COVID-19 are not included in this arrears data.
• Given the measures instituted by the Government of Canada and the deferral of mortgages for those in need by financial institutions, the impacts on mortgage insurance claims will not be known for a number of months and is likely to take longer to be fully realized in our financial results.
• Our capital position remained strong throughout the first quarter of 2020, with an excess capital of $3 billion. As we do not know the impact or magnitude of the COVID-19 crisis on our future results, we have prudently suspended our dividend to conserve our capital.
• We have also continued to work with the provinces and territories to co-develop the Canada Housing Benefit. Progress on the National Housing Strategy is reported quarterly online.
• Since March 31, 2020, CMHC has continued to take an active role in supporting the Government response to COVID-19. In particular, CMHC will administer the Canada Emergency Commercial Rent Assistance (CECRA) for small businesses. The program will lower rent by 75 per cent for small businesses affected by COVID-19 for the months of April, May and June. Additional details are available online.

^{*There were no portfolio substitutions units for the three months ended  31 March 2020} 

CMHC supports the housing market and financial system stability by providing support for Canadians in housing need, and by offering housing research and advice to all levels of Canadian government, consumers and the housing industry. For more information, follow us on Twitter, YouTube, LinkedIn, Facebook and Instagram. 

SOURCE Canada Mortgage and Housing Corporation