Sat May 10 01:10:00 UTC 2025: ## MCAN Financial Group’s Q1 2025 Earnings Dip Amidst Rising Credit Loss Provisions
**Toronto, ON – [Date of Publication]** – MCAN Mortgage Corporation (MCAN Financial Group) announced a decline in first-quarter 2025 earnings, primarily attributed to a significant increase in provisions for credit losses. The company reported net income of $16.6 million ($0.43 per share), a decrease from $23.2 million ($0.65 per share) in the same period last year. This resulted in a drop in return on average shareholders’ equity to 10.99% from 17.09% in Q1 2024.
The primary driver of the decreased profitability was a $3.1 million provision for credit losses on its non-securitized mortgage portfolio, a stark contrast to a $0.6 million recovery in Q1 2024. MCAN cited weaker economic forecasts and the need to provision for impaired residential construction loans as the main reasons for this increase. Despite this, the company maintained a resilient average loan-to-value (LTV) ratio of 64.3% on its uninsured residential mortgage portfolio.
While uninsured residential mortgage originations increased by 15% year-over-year to $97 million, and construction loans rose 2% to $1.1 billion, other factors impacted the bottom line. Equity income from MCAP Commercial decreased by 22%, and net non-securitized mortgage spread income fell by $1.7 million due to narrower spreads over term deposit costs. Securitized mortgages also saw a decrease, with insured residential mortgage securitization volumes dropping 75% year-over-year.
Despite the challenges, CEO Derek Sutherland stated that the results were within expectations given the uncertain economic and geopolitical climate. The company declared a second-quarter cash dividend of $0.41 per share, payable on June 30. Total assets reached $5.4 billion by March 31, 2025.
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