May 3, 2017 / 2:00 PM / 3 months ago

Canada's Equitable Group adds lenders to C$2 billion loan syndicate

2 Min Read

FILE PHOTO: A sign is displayed outside the headquarters of EQ Bank, a subsidiary of Equitable Group Inc, is seen in Toronto, Ontario, Canada May 1, 2017.Chris Helgren

(Reuters) - Canadian mortgage provider Equitable Group Inc (EQB.TO) said on Wednesday it had added three more banks to a syndicate that would fund its C$2 billion ($1.46 billion) loan commitment.

Subprime mortgage lenders in Canada have been racing to shore up confidence in their model as depositors pulled more money out of rival Home Capital Group Inc's (HCG.TO) high-interest savings accounts.

Lenders have suffered since a securities regulator alleged last month that alternative lender Home Capital hid mortgage broker fraud from investors.

Equitable Group said on Wednesday that the syndicate of lenders supporting its two-year loan commitment now also includes Bank of Montreal (BMO.TO), Royal Bank of Canada (RY.TO) and Bank of Nova Scotia (BNS.TO).

Earlier this week, Equitable Group said it had received a letter of commitment for the C$2 billion secured funding facility from banks including Toronto-Dominion Bank (TD.TO), Canadian Imperial Bank of Commerce (CM.TO) and National Bank of Canada (NA.TO).

Equitable Group's shares were up 1.2 percent at C$46.62 in morning trading.

Reporting by Arathy S Nair in Bengaluru; Editing by Shounak Dasgupta

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