Mortgage giant said lending business growth helped fuel higher profits
MCAN Financial Group reported higher first-quarter earnings last week on the back of continued growth in its lending business and rising income from its stake in mortgage finance company MCAP, while announcing a 43-cent cash dividend for the second quarter.
The Toronto-based mortgage investment corporation, which operates as MCAN Mortgage Corporation and trades on the Toronto Stock Exchange under the symbol MKP, released results for the three months ended March 31, 2026, after markets closed on April 30.
Net interest income for the quarter came in at $25.6 million, up 8% from the same period in 2025, while net income climbed 39% to $23.0 million. Return on equity was 14.17%, and earnings per share were $0.57. Book value per share stood at $16.12 at quarter-end.
Total assets under management reached $8.3 billion, an increase of 35% compared with the first quarter of 2025, reflecting expansion across the company’s mortgage and investment portfolios.
Residential mortgage book expands
MCAN said total residential mortgage assets rose to $4.7 billion, up 2% year to date. That included uninsured residential mortgage assets of $1.3 billion, up 4% year to date, and insured residential mortgage assets of $3.4 billion, up 1% over the same period.
Compared with the first quarter of 2025, uninsured residential mortgage originations increased 36%, while insured originations surged 136%, supported by strong renewal volumes.
Management said that performance “reflects our outstanding service to our brokers, originators and customers despite a challenging and competitive market” and was underpinned by growth in its uninsured residential mortgage securitization program.
Construction and commercial mortgage balances rose to $1.2 billion, up 3% year to date, with loan advances of $84.8 million in the quarter. MCAN noted that originations were steady, with some extensions to projects tied to permitting, zoning and current economic conditions, resulting in lower-than-expected run-off but with projects continuing to move toward completion.
Credit metrics and provisions
Provisions for credit losses totalled $1.5 million for the quarter, driven mainly by interest provisioning on impaired residential construction loans, growth in the uninsured residential mortgage portfolio and uncertain economic forecasts.
The impaired total mortgage ratio was 0.99% at March 31, 2026, compared with 0.70% at December 31, 2025. Impaired mortgages were primarily construction loans and uninsured residential mortgages where asset recovery programs have been initiated or the loans are expected to be brought current.
Despite that uptick, MCAN said it believes it has a “quality mortgage loan portfolio,” pointing to an average loan-to-value ratio of 67.4% on uninsured residential mortgages and 60.8% on construction loans as of March 31.
Dividend maintained, MCAP contribution grows
The board declared a regular cash dividend of $0.43 per share for the second quarter, payable June 30, 2026, to shareholders of record as of June 15, 2026.
Under MCAN’s dividend reinvestment plan, dividends are automatically reinvested in common shares issued from treasury at the five-day weighted average trading price less a 2% discount, until further notice.
MCAP, the mortgage finance company in which MCAN holds a strategic interest, continued to be a significant earnings contributor. Income from MCAP totalled $7.9 million year to date, up 43% from the first quarter of 2025, largely due to higher securitization income from larger average portfolio balances.
Chief executive Derek Sutherland said the company had grown assets under management by 7% so far in 2026 and recorded a “significant increase in net income” despite geopolitical and economic headwinds, highlighting steady originations and continued growth in its uninsured securitization program.
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