Sagen MI Canada Inc · TSX:MIC.PR.A
Sagen MI Canada — Genworth MI Canada — Q1 2017 Earnings Presentation
15 slides from Sagen MI Canada's earnings presentation, May 2, 2017
Slide 1: First Quarter 2017 Results
First Quarter 2017 Results May 2nd, 2017 Q1 2017 Results Genworth MI Canada Inc. 1
Slide 2: Forward-looking and non-IFRS statements
Forward-looking and non-IFRS statements Public communications, including oral or written communications such as this document, relating to Genworth MI Canada Inc. (the “Company”, “Genworth Canada” or “MIC”) often contain certain forward-looking statements. These forward-looking statements include, b
Slide 3: 1Q17 financial results
1Q17 financial results $MM except ROE, Q1 Q4 Q1 EPS & MCT 2017 2016 2016 Q/Q Y/Y Q1 key highlights Premiums written $127 $171 $117 -26% +9% • Premiums written YoY impacted by a smaller high Loss ratio 15% 18% 24% -3 pts -9 pts LTV origination market due to 4Q16 regulatory changes Net Operating $107
Slide 4: Our environment today
Our environment today Key takeaways Risk Assessment Improved GDP growth forecast for 2017 (Canada 2.6%; US 2.1%)1 Oil prices stabilizing in the US$50 to US$60 per barrel range in 20172 Economic Stable unemployment rate at 6.7% as of March 20173 Housing risk in Toronto and surrounding areas r
Slide 5: Housing risk
Regional risk assessment High Denotes change from last quarter GTA Key indicators: Overvaluation Pacific (ex GVA) Housing risk Affordability Price-to- income Prairies Ontario GVA Supply/ (ex GTA) demand Quebec Alberta Atlantic Low Economic risk High Key metrics: GDP forecast; UE Rate; Econom
Slide 6: Top line
Top line New insurance written ($ billions) Premiums written ($ millions) Transactional Portfolio Transactional Portfolio $41.9 $619 $21.2 $4.9 Q4 $149 Q4 $5.1 $6.5 $140 Q3 $201 Q3 $6.9 $22 $25.9 $22 Q2 $5.8 Q2 $170 $78 $10.5 Q1 $3.4 $3.0 $4.5 Q1 $99 $89 $18 $38 2016 2017 2016 2017 2016 2017 2016 20
Slide 7: High portfolio quality
High portfolio quality Credit score1 Median home price2 Stacked risk factors3 (In ‘$000s) % Score <660 (R) Avg score (L) National $300 $298 $295 $290 16% 2.0% $280 $275 $270 $255 $240 $232 $225 745 1.5% 1.0% 3% 0.5% 716 0.0% Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q1'17 Q1'17 '07 '08 '
Slide 8: Delinquency trends
Delinquency trends Delinquencies outstanding New delinquencies, net of cures, by region QoQ 568 ∆ Total 2,034 1,961 2,027 2,070 2,082 Total 38 493 491 +55 Prairies1 162 201 203 212 222 189 Prairies1 92 33 436 50 +17 Atlantic 212 211 235 259 Atlantic 352 66 33 138 101 +24 656 504 521 517 93 77 Quebec
Slide 9: Strong financial performance
Strong financial performance $MM except EPS & BVPS Q1’17 Q4’16 Q1’16 Q1 highlights Transactional premiums written $89 $149 $99 • Transactional premiums written lower by 10% Y/Y, due to smaller high LTV market Portfolio premiums written 38 22 18 • Premiums earned increased Y/Y by 9% and 2% QoQ due to
Slide 10: Premium rate increases
Premium rate increases Transactional insurance pricing (Average premium rate, in basis points)1 Insurance portfolio quality – credit score1 % Score <660 (R) Avg score (L) 345-350 330-335 16% 745 293 292 279 716 3% Q1'17 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 2015 2016 Q1 2017 2017E Effective averag
Slide 11: Solid underwriting profitability
Solid underwriting profitability Underwriting profitability ($ millions) Highlights Premiums earned $154 $158 $162 $164 $167 26 32 41 29 • Ten consecutive quarters of Q/Q increases in Losses on claims 37 33 34 premiums earned driven by higher level of Expenses 28 30 33 premiums written in last three
Slide 12: Investments contribute steady income
Investments contribute steady income Total Invested Assets ($6.3B portfolio1) Net Investment Income ($ millions)6 $176 16% Federals Duration: 3.8 years Provincials Book yield: 3.2%2 Q4 $46 33% Investment grade Invested assets corporates3 (C$ millions, unless noted) Preferred shares Net $6.3B unreali
Slide 13: Capital management
Capital management Regulatory capital as at March 31st, 2017 (by category, $ billions unless otherwise noted) Highlights Capital in ~4.0 excess of 3.8 ~0.3 150% 0.4 0.4 Capital in excess of 220% 0.6 0.2 Operational Risk 0.4 Market Risk1 Strong capital position with ~162% MCT ratio under 2017 capital
Slide 14: Key takeaways
Key takeaways Keen focus on risk management Proven Balanced approach to writing new business business model has positioned MIC for Proactive loss mitigation future programs performance Investing in our customer experience strategy Q1 2017 Results Genworth MI Canada Inc. 14
Slide 15: Investor Relations
Jonathan A. Pinto, MBA, LL.M Vice President, Investor Relations 905.287.5482 jonathan.pinto@genworth.com Investor Relations investor.genworthmicanada.ca investor@genworth.com Q1 2017 Results Genworth MI Canada Inc. 15