Home Equity Income Trust will convert to a corporate structure on June 30, the trust said Friday.

The conversion will result in the reorganization of HOMEQ’s income trust structure to a publicly listed corporation (HOMEQ Corp.) that will own all the units of the trust. Unitholders of the trust will receive, for each unit held, one common share of HOMEQ Corporation. The conversion will be completed on a tax-free rollover basis for Canadian residents, HOMEQ says.

The trust previously announced the conversion as part of its plan to continue its operating subsidiary, Canadian Home Income Plan Corp. (CHIP) as a federally regulated, Schedule I Canadian bank. The new bank will be called HomEquity Bank.

HOMEQ says that by obtaining a bank charter HomEquity Bank will have access to retail deposits sourced through deposit brokers. Continuing CHIP as a bank is subject to the review and approval of an application to the federal finance minister and is anticipated to occur in the third quarter of 2009.

The trust also announced today that on June 29, 2009 it will pay a final cash distribution of 12¢ per unit to unitholders of record on June 23.

As previously announced, HOMEQ Corp. plans to begin paying a quarterly dividend of 7¢ a share, with the first quarterly dividend payable to holders of record on the last business day of the fiscal quarter in which CHIP becomes a bank, expected to be September 30.

IE