As part of a strategic partnership between Winnipeg-headquartered Canada Life and Montreal-based nesto, the digital firm will service and administer Canada Life’s residential mortgage portfolio starting January 2024. nesto will be responsible for Canada Life mortgages at maturity as well, according to Monday's announcement.
According to a Q4 2022 management report from Canada Life, the insured loans of its residential mortgage portfolio was valued at $3.1 billion when it decided to cease any new involvement in the sector.
Canada Life decided in 2022 to withdraw from the residential mortgage market.
With the partnership, nesto’s portfolio of mortgages under management will rise to over $10 billion.
nesto’s customer service platform will be offered to existing Canada Life mortgage customers as part of a phased implementation plan in starting mid-2024, the release states.
"We wanted to ensure that our mortgage customers have a best-in-class partner passionate about offering great service for one of their most important investments," Steve Fiorelli, senior vice president of wealth solutions at Canada Life, said in the release.
About Canada Life, nesto
Canada Life is an insurance and wealth management company that is a part of Great-West Lifeco Inc.
The company did not provide details why it exited the residential mortgage market.
Its partner, nesto, is an online mortgage provider that launched in 2018. nesto has earned a number of industray accolades for its platform, including being named the 2023 Canadian Mortgage Lender of the Year by the Canadian Lending Association, Best Mortgage Lender by Forbes Advisor, and to Deloitte's Technology Fast 50 list.
"This partnership is totally aligned with our mission to offer a positive and transparent home financing experience, simplified from start to finish for all Canadians,” nesto CEO Malik Yacoubi said in the release.
“For over 175 years, Canada Life has raised the bar when it comes to improving the financial well-being of Canadians.
"It's humbling for nesto to play a small role in Canada Life's rich history. Our teams are 100 per cent committed to providing the highest level of mortgage service possible."