Syndicated Mortgage Amendments Webinar: March 29,

Transcript:Syndicated Mortgage Amendments Webinar: March 29,:
Syndicated Mortgage Amendments Webinar: March 29, 2021 Presenter: Adam Braun, Senior Advisor, Policy - Investor Office Branch Brendan Smith, Legal Counsel – Compliance and Registrant Regulation Branch Disclaimer 1 The views expressed in this presentation are the personal views of the presenting staff and do not necessarily represent the views of the Ontario Securities Commission or any of its other staff. The presentation is provided for general information purposes only and does not constitute legal or accounting advice. Information has been summarized and paraphrased for presentation purposes and the examples have been provided for illustration purposes only. Information in this presentation reflects securities legislation and other relevant standards that are in effect as of the date of the presentation. The contents of this presentation should not be modified without the express written permission of the presenters. Agenda 2 What is a syndicated mortgage investment (SMI)? Substance of the SMI amendments Registration requirements and process Ongoing compliance obligations Common questions received by OSC staff What is a syndicated mortgage investment? 3 “Syndicated mortgage” means a mortgage in which two or more persons participate, directly or indirectly, as a lender in a debt obligation that is secured by the mortgage. Qualified syndicated mortgage (QSMI) is defined with an intent to limit the scope of these products to lower-risk mortgages on primarily residential property that are similar to conventional mortgages. In particular, the definition excludes SMIs that are for financing the construction or development of property, and have a loan-to-value ratio of greater than 90%. Non-qualified syndicated mortgage (NQSMI) is any syndicated mortgage that does not fall into the definition of QSMI. In Ontario, trades of QSMIs will generally remain under the oversight of the Financial Services Regulatory Authority of Ontario (FSRA). What is a syndicated mortgage investment? 4 QSMI means a syndicated mortgage that satisfies all of the following: the syndicated mortgage secures a debt obligation on property that satisfies all of the following: it is used primarily for residential purposes; it includes no more than four units; it includes no more than one unit that is used for non-residential purposes; the syndicated mortgage does not secure a debt obligation incurred for the construction or development of property; at the time the syndicated mortgage is arranged, the amount of the debt it secures, together with all other debt secured by mortgages on the property that have priority over, or the same priority