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TORONTO, Sept 4 (Reuters) - Laurentian Bank of Canada LB.TO said on Tuesday it had repurchased C$135 million ($103 million) worth of mortgages after a review found they had been incorrectly sold to Canada's federal housing agency.
The bank said in December that it was reviewing mortgages sold to the Canada Mortgage and Housing Corporation's (CMHC) securitization programs and an unnamed buyer after an audit found "documentation issues and client misrepresentations." a statement on Tuesday, Chief Executive Francois Desjardins said the bank had now completed the review. He said the bank bought back C$115 million of mortgages from the unnamed buyer in the third quarter, in line with past guidance.
Mortgage lending practices have been under scrutiny in Canada since problems related to underwriting procedures were identified at alternative lender Home Capital Group HCG.TO . reported an 18 percent decline in earnings per share, excluding one-time items, to C$1.34 in the third quarter ended July 31. Analysts had, on average, estimated earnings of C$1.45, according to Thomson Reuters I/B/E/S.
($1 = 1.3146 Canadian dollars)