(Reuters) - Canadian mortgage provider Equitable Group Inc (EQB.TO) said it received a C$2 billion ($1.47 billion) loan commitment and expected applications to increase in the coming weeks, at a time when rival Home Capital Group’s (HCG.TO) withdrawals are rising.
Shares of Equitable Group, which also reported a 55 percent rise in first-quarter profit, were up 31 percent at C$47.95 in morning trading on Monday.
Equitable Group said its deposit balances fell by C$75 million on average per day, between Wednesday and Friday last week, after Home Capital agreed to tap a high-interest credit line to shore up finances.
Equitable Group’s announcement suggested the “funding situation of the alternative lending market is markedly less drastic than HCG‘s,” Raymond James analysts said in a client note.
Equitable Group shares fell about 41 percent last week, while Home Capital’s stock declined 58 percent.
Equitable Group’s net income was C$43.4 million in the three months ended March 31, compared with C$28.0 million in 2016.
Reporting by Swetha Gopinath in Bengaluru; Editing by Martina D'Couto