Xceed Mortgage Corp., a provider of insured mortgages, will hold a special shareholders’ meeting on Sept. 10, during which shareholders will be asked to approve continuance of the company as a federally regulated Schedule 1 bank under the Bank Act, to change its name to Xceed Bank and Banque Xceed, and to confirm amendments to the company’s by-laws.

Continuance as a Schedule 1 bank also is subject to the approval of the Office of the Superintendent of Financial Institutions. The change in Xceed’s name will take place subject to approval being received from OSFI to continue as a bank.

“As we previously have stated, Xceed determined that it is advantageous for us to become a Schedule 1 bank as it will provide us with access to retail deposits as an additional source for obtaining funds that we can use for our mortgage originations activities,” said, Ivan Wahl, chairman and CEO.

“Retail deposits are a stable, cost-effective means to warehouse insured residential mortgages prior to our pooling them for sale to the Canada Mortgage Bond program. Retail deposits also are a reliable and permanent way to fund conventional residential mortgages to be held on Xceed’s balance sheet until maturity. Continuation as a bank also will assist Xceed in gaining approval from the Canada Housing and Mortgage Corpo. to pool and sell mortgages directly to the Canada Mortgage Bond program without the need for us to rely on an intermediary and pay the costs associated with that,” Wahl added.

“As a bank, Xceed will be able to resume selling financial products to the niche market that is not well-served by traditional lenders and we will be able to compete on a level playing field with existing small banks and trust companies,” he continued.

Xceed also will have more flexibility to eventually enter into the marketplace for other related financial products, such as credit cards.

“As a federally regulated entity, Xceed expects to have access to a more stable funding platform and to benefit from the lower risk accorded by investors to investments in Canadian banks. This will result in Xceed becoming exposed to a wider range of potential investors and other capital providers, which will enable us to continue to build our capital base to support future growth. This should increase the value of our business for our shareholders,” Wahl added.

The proposed continuance of the company as a bank requires approval by two-thirds of the votes cast by Xceed’s shareholders present or represented by proxy at the special meeting, as well as the obtaining of all necessary regulatory and other approvals.