From: " To: David Neuhauser Subject: (Financial Times)Home Capital woes spark fears on Canada property market(Livermore interviewed) Date: Thu, 18 May 2017 15:40:58 +0000 Inline-Images: bottom.letterhead To Partners: Please find below an article in this morning's Financial Times regarding Home Capital and the state of the Canadian housing market. It is an interesting read. Sincerely, Livermore Partners https://www.ft.com/content/59f8e496-3b45-11e7-ac89-b01cc67cfeec Home Capital woes spark fears on Canada property market Non-bank mortgage lender has battled to stem outflow of deposits Financial Times May 18th, 2017 9 HOURS AGO by: Ben McLannahan in New York A fight for survival at Home Capital Group, Canada's biggest non-bank mortgage lender, is sparking fears of a broader meltdown in the country's super-heated property market. Shares in Home Capital came under pressure last month after Ontario's securities regulator said it had failed to promptly disclose possible fraud among some of its mortgage applicants. The company has since battled to stem an outflow of deposits despite agreeing to tap a high-interest credit line to shore up its finances. Stephen Poloz, governor of the Bank of Canada, said in an interview over the weekend that Home Capital's problems were "idiosyncratic", and that he saw no sign of broader contagion. But the reality of vanishing deposit funding — down about $600m this month, from about $13.5bn at the end of April — has prompted parallels with New Century, the second-biggest subprime lender in the US that hit serious trouble about 18 months before the Lehman crisis. "Regulators have their heads in the sand," said Marc Cohodes, a veteran short-seller who began to target Home Capital a couple of years ago. "They should have said, 'these guys are done, the big banks will pick up the slack, we've got rid of a bad actor'. EFTA00451791