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Famed investor Warren Buffett’s interest in Home Capital Group Inc. is paying off for the troubled Canadian mortgage firm, as millions of dollars in investor deposits are now flooding back into the company.

Famed investor Warren Buffett's interest in Home Capital Group Inc. is paying off for the troubled Canadian mortgage firm, as millions of dollars in investor deposits are now flooding back into the company.

The company gained more than $100-million in new deposits between June 20 and 27, including the company's Oaken Financial savings products and guaranteed investment certificates. Most of the new cash came in after Mr. Buffett's Berkshire Hathaway Inc. announced on the night of June 21 that it would buy an equity stake of up to $400-million in Home Capital, becoming its largest shareholder, and would extend the firm a $2-billion credit line.

Home Capital's GIC balances rose by $92-million over the week, while almost $10-million returned to Oaken-branded savings accounts.

Related: Home Capital's lifeline cost $210-million in latest quarter

For subscribers: Exclusive: Buffett on how he struck the Home Capital deal

Home Capital offers financial products under three separate brands: Home Trust, Home Bank and Oaken Financial.

Home Trust high-interest savings account (HISA) balances stayed flat at approximately $112-million. Several months ago, the company held approximately $2-billion in HISA deposits before trouble hit for the lender.

The Ontario Securities Commission levelled allegations that the company broke disclosure rules by failing to reveal in a timely way problems of fraud it had discovered in its mortgage business. Three former high-level executives are also named in the case.

Brokers at other financial institutions grew wary of the company and some investment firms decided to cap the amount of deposits clients could hold in Home Capital products. Money began to pour out of its high-interest savings accounts – a run on the bank that nearly led the firm to collapse in early May and forced it to receive emergency financing from a pension fund.

Earlier this year, Home Capital was seen as an attractive mortgage lender that was able to offer better-than-average interest rates for both HISAs and GICs.

Over the past rocky few months, Home Capital has remained aggressive in both the HISA and GIC markets by offering attractive interest rates that at times were more than double what Canadian banks were offering, in a bid to attract more deposits needed to continue its business.

Currently, Oaken Financial GICs are offering 2.75 per cent for a one-year GIC, while Home Trust is slightly less at 2.5 per cent. (Home Trust GICs are sold through the investment-adviser channel while Oaken GICs are sold directly to investors.)

By comparison, Equitable Bank's one-year rate is posted at 1.45 per cent while Bank of Montreal is offering 0.85 per cent for the same term.

Both Equitable and Home Capital are in the business of providing mortgages to borrowers who have difficulty qualifying for them from a major bank.

After hearing of the potential backing of Berkshire Hathaway in Home Capital, some investment industry professionals said they were once again confident in recommending Home Capital products to their clients.

However, several financial institutions – including Bank of Nova Scotia's wealth-management arm – have yet to lift a capped limit of $100,000 of Home Capital product that an adviser could sell to a client.

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