Timbercreek Expects Q4 Payout Ratio of About 135% During Vancouver Sale

Timbercreek Financial Corp. expects its DI payout ratio to reach about 135% in the fourth quarter as it works toward selling its Vancouver portfolio after losses on staged loans.

The company is targeting completion of the sale by the end of Q1 2027, subject to market conditions and execution. Timbercreek expects the payout ratio to remain elevated while the sale process continues.

Revised recovery assumptions for Vancouver staged loans contributed to about $33 million in expected credit losses in the third quarter. The losses contributed to a net loss of $32.1 million.

Timbercreek aims to speed up loan resolutions and put recovered capital into performing mortgages. Its net mortgage portfolio stood at about $1.22 billion, while credit facilities were about 98% utilized.

Management cited loan syndications as support for balance-sheet capacity. It said Timbercreek would size its credit facility appropriately and seek equity and debt funding when growth opportunities arise. Management may consider changing the distribution if payments continue to exceed earnings.