Mortgage Co. of Canada Halts Redemptions
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- Mortgage Company of Canada Inc. announced a temporary halt to investor redemptions and monthly distributions for its residential lending fund, effective immediately (notice dated May 14).
- Raj Babber, CEO of Mortgage Company of Canada, said the Toronto market remained "profoundly challenging", with rising mortgage delinquencies and a backlog in Ontario courts delaying power‑of‑sale recoveries.
- Mortgage Company of Canada will suspend income distributions after its June 15 payout and will later distribute cash on a pro‑rata basis through mandatory monthly redemptions of up to 8 % of each investor’s holdings per year.
- Canadian national home sales rose 0.7 % in April, but the Toronto region’s market stays weak, with home prices still below their 2022 peak.
Why it matters: Investors lose immediate cash access as the fund freezes redemptions and suspends distributions, retaining earnings to shore up its balance sheet while future withdrawals will be limited to 8 % per year, tightening liquidity for shareholders.
