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UPDATE 3-Home Capital says 'top notch' shortlist for CEO role

* Expects CEO appointment soon

* Director Hibben not a candidate for CEO role

* Expects to record second-quarter loss

* Further asset sales possible in July (Adds comments from Home Capital executives)

June 29 (Reuters) - Canadian lender Home Capital Group Inc's Chair Brenda Eprile on Thursday told shareholders at the company's annual meeting it had attracted a "top notch" list of candidates for its chief executive role and would make an appointment soon.

The company has been searching for a new CEO since March 27 when it terminated the employment of former chief executive Martin Reid.

"We've got a very short short-list," Eprile said, adding that an appointment would be made within weeks.

Director Alan Hibben, a former Royal Bank of Canada executive who has played a key role in negotiating the bank's refinancing and asset sales, said that he was not one of the candidates, despite media reports linking him with the role.

Earlier on Thursday, Home Capital said it expects to record a loss in the second quarter due to costs related to its efforts to shore up liquidity.

The increased costs were widely expected and shares in Home Capital were up 0.8 percent to C$17.33 at 1230 EST (1630 GMT).

Former CEO Reid's departure had sparked a withdrawal of funds from Home Capital's high interest savings accounts which accelerated after April 19, when Canada's biggest securities regulator, the Ontario Securities Commission (OSC), accused Home Capital of making misleading statements to investors about its mortgage underwriting business.

Home Capital reached a settlement with the OSC earlier in June and accepted responsibility for misleading investors about mortgage underwriting problems.

Last week, it received $2 billion in new financing from U.S. billionaire Warren Buffett's Berkshire Hathaway, which it has said gives it a critical platform to recover investor and depositor's confidence. It also raised C$1.2 billion from the sale of a commercial loan portfolio.

Hibben said further sales or the refinancing of some assets could take place in July.

"There's a bunch of things that are in flight. As to whether we will execute on everything in flight is a question. It's not just asset sales. They may actually be financings of one sort or another," he said.

Home Capital, which is expected to release second-quarter results on Aug. 2, said its expenses would increase by C$233 million ($179 million) before taxes, which includes C$210 million in costs related to its recent liquidity issue.

Home Capital also said it received conditional listing approval from the Toronto Stock Exchange for Berkshire's initial investment of C$153.2 million for a stake of about 20 percent.

($1 = 1.3009 Canadian dollars) (Additional reporting by Yashaswini Swamynathan in Bengaluru; Editing by Saumyadeb Chakrabarty and Clive McKeef)