HomeEquity Bank Fuels Growth with Oversubscribed $200M Debt Deal

TORONTO, ON – April 28, 2026 – CHIP Mortgage Trust (CMT), a key financing vehicle for HomeEquity Bank, today announced the successful closure of a $200 million senior medium term notes issuance, a move that signals powerful investor confidence in the future of Canada's reverse mortgage market.

The deal was not merely successful; it was heavily oversubscribed, attracting a mix of existing and new investors. The notes, which carry a coupon of 4.066% and mature in 2031, secured a top-tier AAA (sf) rating from DBRS Limited, a testament to their perceived security. This strong demand allowed the trust, a wholly owned subsidiary of HomeEquity Bank, to secure crucial capital that will be used to refinance existing debt, acquire new mortgages originated by its parent, and fund ongoing operations.

A Resounding Vote of Confidence

The oversubscription of the note issuance is a significant market signal, indicating that investor demand far outstripped the available supply. Led by a powerful syndicate of dealers including TD Securities, CIBC Capital Markets, and Scotia Capital, the deal's success underscores a bullish outlook on HomeEquity Bank's specialized business model.

"Strong investor support has resulted in another very successful issue of medium term notes by CHIP Mortgage Trust," said Atul Chandra, Executive Vice President and Chief Financial Officer at HomeEquity Bank, in a statement. "We are pleased that the transaction was heavily oversubscribed with a number of new buyers."

This enthusiasm is not happening in a vacuum. It reflects a broader appetite for high-quality Canadian debt, particularly from well-regulated financial institutions. For investors, the combination of a strong yield and a top-tier credit rating presents an attractive opportunity in the current fixed-income landscape. The successful placement validates HomeEquity Bank's strategy of using medium term notes as a reliable and key source of funding for its expansion.

Chandra noted the bank's performance was a key driver, stating, "HomeEquity Bank's exceptional operating and financial results as Canada's leading provider of reverse mortgages resonated well with investors and drove very strong demand for these notes."

Fueling the Market Leader

This $200 million capital injection is poised to further entrench the market dominance of HomeEquity Bank. The institution holds an estimated 90% of the Canadian reverse mortgage market, a position it has cultivated over 40 years of specializing in financial solutions for Canadians aged 55 and older. Its flagship CHIP Reverse Mortgage™ product has become nearly synonymous with the sector itself.

The bank's growth has been formidable. Its total reverse mortgage portfolio under management has surged in recent years, growing from $5.4 billion in 2021 to over $8.8 billion by the end of 2024. The proceeds from this note issuance will directly fuel that trajectory, enabling the bank to purchase more reverse mortgages and expand its reach. This strategy is further supported by a unique referral network, where Canada's major chartered banks, which do not offer reverse mortgages directly, often direct interested clients to HomeEquity Bank.

As a portfolio company of the Ontario Teachers' Pension Plan Board, HomeEquity Bank operates with the backing of a major institutional investor, adding another layer of stability that resonates with capital markets.

The Demographic Wave Driving Demand

The investor confidence reflected in CMT's debt issuance is fundamentally rooted in powerful demographic and economic trends reshaping Canada's retirement landscape. The nation's aging population is creating a growing cohort of seniors who are asset-rich, primarily through home ownership, but may require additional cash flow to fund their retirement.

Research shows an overwhelming majority of older Canadians—upwards of 93%—wish to "age in place," remaining in their homes and communities. Reverse mortgages provide a vehicle to unlock the equity tied up in their property without having to sell or take on monthly mortgage payments. This financial tool helps bridge income shortfalls, cover rising healthcare costs, or simply fund a more comfortable retirement lifestyle.

The Canadian reverse mortgage market, while still a niche segment of the broader mortgage industry, has seen significant growth, expanding from an estimated $6.5 billion in 2022 to $8.5 billion in 2023. This upward trend is expected to continue as more baby boomers enter their post-career years, making HomeEquity Bank's focused business model increasingly relevant.

Behind the Gold-Standard AAA Rating

Underpinning the deal's broad appeal is the coveted AAA (sf) rating from DBRS Limited. The "AAA" signifies the highest possible credit quality, indicating that the capacity for payment of financial obligations is exceptionally high. The "(sf)" suffix specifies that this is a structured finance product, meaning the notes are backed by the cash flows from a dedicated pool of assets—in this case, HomeEquity Bank's reverse mortgages.

Achieving this rating is a direct reflection of the perceived quality and stability of the underlying mortgage portfolio and the bank's robust risk management framework. As a federally regulated Schedule I bank, HomeEquity Bank operates under the stringent oversight of the Office of the Superintendent of Financial Institutions (OSFI). Its financial disclosures reveal a very strong capital position, with a Common Equity Tier 1 (CET1) ratio of 15.4% as of early 2025, more than double the regulatory minimum of 7.0%. This high level of capitalization provides a substantial cushion against potential economic headwinds, a fact not lost on credit rating agencies and investors.

The bank's proprietary underwriting model, which considers property value, borrower age, and geographic diversification, is designed to minimize risk. This disciplined approach ensures the loan-to-value ratios are conservative, protecting both the bank and the homeowner. The result is a high-quality asset pool that can support a top-tier credit rating and, consequently, attract capital at favorable rates.

This successful transaction not only provides immediate funding but also reinforces the market's trust in HomeEquity Bank's ability to manage its portfolio effectively, ensuring that medium term notes will, as Chandra stated, "continue to be, a key source of funding for our rapidly growing reverse mortgage business."