Atrium Mortgage Investment (TSE:AI) management said the company delivered “strong results” in the fourth quarter and full year ended Dec. 31, 2025, despite what it described as weak economic conditions and a severe downturn in Canadian residential real estate markets.
Financial results and dividends
Chief Financial Officer Chris Anastasopoulos reported net income of CAD 12.2 million in the fourth quarter, with basic earnings per share (EPS) of CAD 0.25, down from CAD 0.27 in the fourth quarter of 2024. For the full year, Atrium posted net income of CAD 49.1 million, a 2.5% increase over the prior year, resulting in basic EPS of CAD 1.03.
Chief Executive Officer Robert Goodall said the company’s 2025 results marked the fourth consecutive year in which Atrium’s earnings exceeded CAD 1 per share and said the performance supported the special dividend.
Portfolio growth and yield trends
Atrium’s mortgage portfolio ended 2025 at CAD 917.1 million, up 3.4% from CAD 886.7 million at the end of 2024. Anastasopoulos said the company grew the portfolio in a difficult market, pointing to the strength of its underwriting team.
During 2025, Atrium reported CAD 358.6 million of mortgage principal advanced and CAD 316.6 million repaid and transferred, net of CAD 4.3 million of write-offs. Goodall characterized the year’s repayments as representing portfolio turnover of approximately 39%, which he said is in line with the company’s normal level and “a sign of a healthy portfolio.”
The average interest rate on the mortgage portfolio declined to 8.98% at Dec. 31, 2025, from 9.98% a year earlier. Anastasopoulos attributed the decline to repayments of higher-yield loans relative to new originations and the effect of four 25-basis-point Bank of Canada rate cuts during the year on floating-rate loans. At year-end, 80.8% of the portfolio was priced on floating rates, with management noting that the majority carried rate floors. Goodall added that the average mortgage rate fell from 9.2% in the prior quarter to 8.98% in the fourth quarter, reflecting a 25-basis-point drop in prime during the quarter.
Underwriting mix, loan-to-value, and exposure shifts
Management emphasized portfolio composition and underwriting metrics as part of its risk posture. At Dec. 31, 2025, 95.2% of Atrium’s mortgages were first mortgages. The company’s average loan-to-value (LTV) ratio was 61.4%, down from 61.9% at the end of 2024, though Goodall noted the LTV increased slightly from 60.8% in the third quarter to 61.4% at year-end and remained within the firm’s desired 65% range.
Atrium reported CAD 85 million of high-ratio loans (over 75% LTV), representing 9.3% of the portfolio. Within single-family mortgages, loans over 75% LTV totaled just over CAD 30 million, while there were five high-ratio commercial loans totaling CAD 54.7 million. Goodall said one CAD 14.25 million loan was repaid in full in January, and another loan totaling CAD 12.6 million was expected to be “substantially paid down” by the end of March.
Goodall also discussed progress implementing a strategy to increase exposure to what he described as lower-risk sectors. He said commercial mortgages represented 28.7% of the portfolio at year-end, increasing by CAD 72 million, or 38%, year over year. The single-family and apartment category rose to 19.2% of the portfolio, up 14% year over year. Together, he said these two areas represented about 48% of the portfolio.
Construction loans rose slightly in the fourth quarter but remained less than 5% of the portfolio, Goodall said. He noted the company funded a CAD 12.5 million construction loan in the quarter with a “well-known Toronto developer” for a purpose-built rental project.
Credit quality, impaired loans, and allowances
Atrium reported shifts in its IFRS 9 staging during the quarter and year. At Dec. 31, 2025, Stage 1 mortgages were CAD 782.4 million, down 3.1% from CAD 807.7 million a year earlier. Stage 2 mortgages were CAD 48.7 million, down 2.6% from CAD 49.9 million at the end of 2024. Stage 3 loans increased to CAD 86 million at year-end, compared with CAD 29 million at Dec. 31, 2024 and CAD 56.3 million at the end of the third quarter.
Anastasopoulos said three commercial loans totaling approximately CAD 53 million migrated to Stage 3 in the fourth quarter as they became impaired, offset by repayments of commercial loans of about CAD 23 million during the quarter. Goodall said Stage 2 loans fell sharply from CAD 96.8 million to CAD 48.7 million, while Stage 3 increased due to the addition of a CAD 31 million loan. He said that property had been conditionally sold and was expected to be repaid in early Q2 2026.
On the Q&A, Goodall was asked whether the expected repayment of that CAD 31 million Stage 3 loan would be a full recovery. He responded that the company expected a full repayment with no loss, citing that the property was under contract.
The allowance for credit losses (ACL) totaled CAD 30.5 million at Dec. 31, 2025, up 3.1% from the prior year and equivalent to 332 basis points of the mortgage portfolio, which management said was consistent with the prior year’s 333 basis points. The Stage 1 ACL was CAD 6.1 million (down from CAD 8.1 million), the Stage 2 ACL was CAD 2.9 million (down from CAD 8.1 million), and the Stage 3 ACL was CAD 21.5 million (up from CAD 13.3 million).
Goodall said Atrium recorded a CAD 1 million loan loss provision expense in the fourth quarter, following a CAD 1.3 million provision in the third quarter, and CAD 4.5 million for the full year. Asked how provisioning could trend in 2026, he said it was too early to tell but suggested it would likely be similar to 2025 and said it would surprise him if provisions returned to 2023 levels, which he described as “well over $10 million.” He added that the company risk-rates every loan quarterly and that management believed it was “very adequately provisioned” on loans in Stage 2 and Stage 3.
Funding, leverage, and 2026 priorities
Atrium said it ended 2025 with what management described as a strong liquidity position and low leverage. Balance sheet debt remained at 40%, with CAD 283 million drawn on a CAD 380 million credit facility. The weighted average cost of borrowing on the credit facility was 5.08% in 2025, down from 7.03% in the prior year.
During 2025, Atrium repaid two convertible debentures: a 5.6% debenture with principal of CAD 28.7 million on March 31, and a 5.5% debenture with principal of CAD 34.4 million on Dec. 31. Management said it expanded its lender syndicate by adding three new lenders in 2025 and increased its committed credit facility from CAD 340 million to CAD 380 million. Both Anastasopoulos and Goodall said the company expects to consider accessing the convertible debenture market in 2026, subject to favorable market conditions.
Looking ahead, Goodall said Atrium’s strategy has been to focus on single-family mortgages and commercial real estate, with a preference for income-producing assets. He said the company is “avoiding development” except for the strongest developers. He also noted that sourcing new loan business could remain challenging in 2026 due to weak market activity and aggressive competition from banks, and said Atrium added two underwriters in its Toronto office to free up time to source new business. Goodall said the company also hoped for growth from Western Canada and was considering recruiting a managing director in Alberta.
About Atrium Mortgage Investment (TSE:AI)
Atrium Mortgage Investment Corp is a non-banking finance company providing residential and commercial mortgages that lends funds in major urban centres in Canada where the stability and liquidity of real estate are high. Its objectives are to provide its shareholders with stable and secure dividends and preserve shareholders’ equity by lending within conservative risk parameters. The company generates its revenue from mortgage interest and fees.
