Basic Earnings per Share of $1.54, or $1.60 excluding second quarter tax adjustments Return on Equity of 25.1% Second Quarter Net Income Increases 10.4%, or 14.5% excluding second quarter tax adjustments, over 2011 Net Income

TORONTO, Aug. 1, 2012 /CNW/ - Home Capital Group (HCG.TO) today reported another quarter of strong results for the three months ended June 30, 2012.

The Company's Second Quarter Report, including Management's Discussion and Analysis, is available on http://www.homecapital.com and on the Canadian Securities Administrators' website at http://www.sedar.com.

FINANCIAL HIGHLIGHTS

1 See definition of Adjusted Net Income under Non-GAAP Measures of the unaudited interim consolidated financial report and reconciliation to net income in Table 2 of the Management's Discussion and Analysis. 2 See definition of Taxable Equivalent Basis (TEB) under Non-GAAP Measures of the unaudited interim consolidated financial report.The net interest margin non-securitized assets for March 31, 2012 was amended from the previously disclosed amount of 3.00%. 3 Total loans include loans held for sale. 4 These figures relate to the Company's operating subsidiary, Home Trust Company.

SECOND QUARTER 2012 HIGHLIGHTS

Key results for the second quarter of 2012 included:

Consistent with the first quarter of 2012, the Company is delivering solid performance despite the persistent international economic instability and muted economic improvement in Canada. The Company's performance reflects the strength, and the successful execution, of the Company's core strategy.

As discussed in the first quarter of 2012, the Company continues to see resilient and relatively stable real estate markets across most of Canada, with a few areas of continuing concern, where the Company has already scaled back.The Company expects real estate demand to remain relatively stable in 2012 with potentially modest declines in some of the larger markets. This is expected to result in relatively balanced real estate market conditions and lead to continued healthy demand for the Company's products, consistent with the first half of the year. The Company has not seen evidence of a "real-estate bubble" in Canada. Low interest rates and stable employment have maintained housing affordability. The Company expects interest rates to remain at current levels or experience very modest increases into 2013 and that Canadian employment levels will remain relatively stable in 2012. The Company maintains a solid capital position and prudent liquidity and expects that it is well positioned to deal with the impact of uncertainty that may affect the Canadian economy.

Favourable market opportunities have supported the Company's strategy of renewed focus on the traditional mortgage portfolio with record levels of originations in this product category. While the Company has increased lending in this product category it has been able to do so with improving credit quality. The average credit score for traditional mortgage originations for the first half of 2012 is up from the same period of 2011 while loan to value ratios are down. The Company remains proactive and prudent in its lending practices, taking into account local economic and market conditions.The credit quality of the loan portfolio remains strong, reflecting the Company's focus on diligent underwriting combined with strong collection standards and loan resolution strategies.

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Home Capital Reports Strong Performance for the Second Quarter