Firm Capital Mortgage Investment Corporation

Climate Impact & Sustainability Data (2015, 2019, 2021)

Economic conditions that would result in a significant decline in real estate values and corresponding loan losses.
Under various federal, provincial and municipal laws, an owner or operator of real property could become liable for the cost of removal or remediation of certain hazardous or toxic substances released on or in its properties or disposed of at other locations.
The inability to obtain borrowings and leverage, thus reducing yield enhancement.
Dependence on the Corporation Manager and Mortgage Banker.
Portfolio face rate fluctuations.
Interest rate risk.
No guaranteed return.
Qualification as a Mortgage Investment Corporation.
Availability of investments.
Limited sources of borrowing.
Specific investment risk for non-conventional mortgage and second mortgage investments.
Specific investment risk for land mortgage investments.
Reliance on Borrowers.

Maintaining a diversified portfolio that has the majority of the investments shared with other syndicate partners.
Continuously monitoring all markets and rebalancing the portfolio to reflect the current environment and market conditions.
Focusing its lending into core markets that can be monitored closely during evolving economic conditions.
Mitigating loan loss risk by focusing on those areas of mortgage lending that have historically withstood market corrections and retained their underlying real estate asset value while limiting its exposure to those real estate asset classes that do not.
Maintaining a heavily concentrated short-term investments portfolio (65% maturing by December 31, 2016) to continually revolve the portfolio and adapt to changes in the real estate market.
Obtaining phase 1 environmental reports for mortgages where the Mortgage Banker determines that such reports would be prudent given the nature of the underlying property.
Limiting the amount of Conventional Non-First Mortgage investments to a maximum of 30% of the Corporation’s capital, subject to the Board of Directors’ approval for any modifications to the operating policies.
Paying close attention to factors including the Alberta real estate market and the Canadian housing market in general, and will not invest in mortgages secured by illiquid and non-marketable properties.
Maintaining a solid loan loss impairment provision to maintain a strong balance sheet and stable dividends.

Frameworks Used: IFRS

Third-party Assurance: KPMG LLP

Economic conditions that would result in a significant decline in real estate values and corresponding loan losses.
Under various federal, provincial and municipal laws, an owner or operator of real property could become liable for the cost of removal or remediation of certain hazardous or toxic substances released on or in its properties or disposed of at other locations.
The inability to obtain borrowings and leverage, thus reducing yield enhancement.
Dependence on the Corporation Manager and Mortgage Banker.
Portfolio face rate fluctuations.
Interest rate risk.
No guaranteed return.
Qualification as a Mortgage Investment Corporation.
Investment portfolio size.
Limited sources of borrowing.
Liquidity risk.
Demand loan bank indebtedness.
Specific investment risk for non-conventional mortgage and second mortgage investments.
Reliance on Borrowers.
Credit Risk.
Change in Legislation.
Currency risk.

Maintaining a diversified portfolio that has the majority of the investments shared with other investor partners.
Continually monitoring all markets and rebalancing the portfolio to reflect the current environment and market conditions.
Focusing its lending into core markets that can be monitored closely during evolving economic conditions, with a strong focus on Ontario.
Obtaining phase 1 environmental reports for mortgages where the Mortgage Banker determines that such reports would be prudent given the nature of the underlying property.
The short-term nature of the portfolio provides the Corporation with the ability to continually revolve the portfolio and adapt to changes in the real estate market.
Managing liquidity risk by forecasting cash flows from operations and anticipated investing and financing activities.
Mitigating loan loss risk by focusing on those areas of mortgage lending that have historically withstood market corrections and retained their underlying real estate asset value while limiting its exposure to those real estate asset classes that do not.
The weighted average loan to value ratio on conventional mortgages is approximately 60% based on the appraisals obtained at the time of funding each mortgage loan.
Managing currency risk on its investments by borrowing the same amount as the investment in the same currency.

Frameworks Used: IFRS

Third-party Assurance: KPMG LLP

COVID-19 pandemic: disruption or deferral in borrower payments, decline in the appraised value or salability of properties, a decline of interest rates, a deterioration of the credit worthiness of the borrowers, inability for the borrowers to obtain additional financing and/or the need to extend the maturity date of their borrowings.
Economic conditions such as inflation, that would result in a significant decline in real estate values and corresponding loan losses.
Inability to obtain borrowings and leverage, thus reducing yield enhancement.
Dependence on the Corporation Manager and Mortgage Banker.
Portfolio face rate fluctuations.
Interest rate risk.
Investment Portfolio size fluctuations.
Limited sources of borrowing.
Liquidity risk.
Demand loan bank indebtedness.
Specific investment risk for non-conventional mortgage and second mortgage investments.
Reliance on Borrowers.
Credit Risk.
Change in Legislation.
Litigation risk.
Ability to manage growth.
Cyber risk.
Currency risk.

Maintaining a diversified portfolio with investments shared with other investor partners.
Continuously monitoring all markets and rebalancing the portfolio.
Holding a hard line on acceptable exposure levels, borrower quality and warranted interest rate pricing.
Rejecting a significant number of potential investments that do not meet investment criteria and risk tolerance.
Focusing lending into core markets that can be monitored closely during evolving economic conditions, with a strong focus in Ontario.
Not servicing or underwriting mortgages on hotels, hospitality properties or long-term care facilities.
Maintaining a weighted average loan to value ratio on conventional mortgages under 60%.
Managing liquidity risk by forecasting cash flows from operations and anticipated investing and financing activities.
Limiting Conventional Non-First Mortgage investments to a maximum of 30% of the Corporation’s capital.
Obtaining phase 1 environmental reports for mortgages where deemed prudent.
Managing currency risk by borrowing the same amount as the investment in the same currency.