Shareholders of Xceed Mortgage Corp., a provider of insured mortgages, have voted to approve continuance of the company as a federally regulated Schedule 1 bank under the Bank Act, the company announced on Friday.

At a special meeting held in Toronto on Thursday, the shareholders also approved a change in the company’s name to Xceed Bank and Banque Xceed, and to confirm the amendments needed to the by-laws of the company.

The continuance of Xceed as a bank and changes to the company’s name and bylaws are subject to receiving the approval from the Office of the Superintendent of Financial Institutions of the company’s application to be granted Schedule 1 bank status.

“As a bank, Xceed will benefit by increasing our channels for obtaining additional funds that we can use for underwriting new mortgages and renewing existing ones in our nearly $2 billion portfolio of assets under management,” said Ivan Wahl, chairman and chief executive officer. “We will be able to attract retail deposits, by issuing guaranteed investment certificates, at rates that are competitive in the marketplace while providing a reasonable cost for Xceed.”

Wahl added that the bank status should improve the spreads between the company’s sourcing funds and underwriting activities. It would also help Xceed gain approval from the Canada Housing and Mortgage Corporation to pool and sell mortgages directly to the Canada Mortgage Bond program without requiring the company to rely on a conduit, he said.

“As a bank, we expect to be able to resume selling financial products to the niche market that is not well-served by traditional lenders. We will be able to compete on a level playing field with other existing small banks and trust companies. We will have more flexibility to eventually enter into the marketplace for other related financial products,” Wahl said.