Signage for Home Trust Co., a subsidiary of Home Capital Group Inc., stands outside the company’s headquarters in Toronto, on May 4, 2017. (Cole Burston/Bloomberg)
Troubled mortgage lender Home Capital Group Inc. has chosen Yousry Bissada, a 57-year-old executive with experience in the mortgage industry, as its chief executive officer.
Since 2011, Mr. Bissada has been CEO of Kanetix Ltd., a firm that sources insurance quotes and helps financial services firms with digital tools. But he has also led a leading software provider to the mortgage industry, and has experience working inside big banks, including a brief stint as senior vice-president of real estate secured lending products at Toronto-Dominion Bank in the late 1990s.
Hiring a new chief executive was a crucial step in the company’s turnaround plan. After a crisis of confidence sparked a run on Home Capital’s deposits earlier this year, pushing Home Capital to the brink, a refreshed board of directors secured support from revered investor Warren Buffett, whose firm Berkshire Hathaway Inc. is now the largest shareholder. With Mr. Buffett behind it, the alternative mortgage lender began to see money from depositors flow back into the company.
Home Capital also sold two portfolios of mortgages, for nearly $1.2-billion and $250-million respectively, to provide liquidity and help pay down an onerous loan that stabilized the lender at the depths of its crisis.
“[Mr. Bissada] has spent much of his career finding ways to make companies run more smoothly, improving customer service and applying technology to the financial services and mortgage industries,” said Brenda Eprile, chair of Home Capital’s board, in a statement. “In addition, Yousry has proven his ability to balance an entrepreneurial culture with operational and regulatory discipline, to energize teams and to create value. These are precisely the characteristics we see driving our future success.”
Mr. Bissada’s hiring begins a process of renewing Home Capital’s executive ranks. One of his first tasks will be to help finish a search for a new chief financial officer.
“Home plays a critically important role in terms of helping Canadians realize their dream of home ownership," Mr. Bissada said in a statement, adding: “We want to be the first choice for depositors, borrowers and brokers.”
But Home Capital still has work to do to position itself for growth, including stabilizing its capital structure at a reasonable cost. At its annual meeting in late June, board member Alan Hibben cautioned investors: “It’s too early to declare victory.”
The company’s share price, which had been rebounding, has dipped over the last week as Canada’s banking regulator considers tightening mortgage underwriting rules in a way that has been seen as negative for alternative lenders like Home Capital.
Home Capital terminated its previous CEO, Martin Reid, in late March. Since then Bonita Then, who sat on the company’s board, has served as interim CEO.
The search for a new CEO was led by executive search firm Caldwell Partners International Inc.