Home Capital Group Inc. today announced solid financial results for the second quarter ended June 30.

Despite challenging market conditions affecting many financial services firms, the company’s core business activities including residential and commercial mortgage lending, CMHC-insured mortgage-backed securities, and Visa lending all generated strong earnings growth and returns.

Net income for the quarter was $26.6 million, an increase of 20.6% over $22 million recorded in the same period last year. Basic earnings per share were 77¢, 20.3% above 64¢ for the second quarter of 2007.

Return on equity was 27.7% for the second quarter, compared to 28.9% for the quarter ended June 30, 2007.

Total assets at June 30, 2008 reached $5.36 billion, 24.5% higher than the $4.31 billion reported one year earlier. Total assets, together with mortgage-backed securities (MBS) originated and administered by the company, grew to $7.04 billion, a rise of 27.0% from $5.54 billion at June 2007.

Total mortgage originations were $886.9 million during the second quarter, an increase of 42.5% over the $622.6 million advanced during the same period in 2007. The company advanced $768.6 million in residential mortgages, $85.2 million in commercial mortgages, $19.6 million in mortgages on store and apartment properties and $13.5 warehouse commercial mortgages.

Mortgage securitization activity continued to produce good results as the company securitized and sold $250.6 million in CMHC-insured securities during the second quarter, compared to $150.7 million for the same period last year. The increased level of securitization activity was due to favourable market conditions that allowed Home to raise funds by selling MBS pools at more cost effective rates than if Home raised the funds through term deposits.

Outstanding balances on the Equityline Visa portfolio reached $339.1 million, a rise of 24.7% from the $272 million recorded in the same period last year.

Net income from consumer lending reached $4.8 million for the second quarter, 29.6% over the $3.7 million recorded last year.

In light of the company’s increasing profitability and strong growth, the board of directors declared an increased quarterly cash dividend of 13¢ a share.

Home Capital operates through its principal subsidiary, Home Trust Co. Home Trust is a federally regulated trust company offering deposit, mortgage lending, retail credit and payment card services.