Genworth Financial Inc · NYSE:GNW
Genworth Financial — Q2 2017 Earnings Presentation
23 slides from Genworth Financial's earnings presentation, Aug 2, 2017
Slide 1: Earnings Summary Second Quarter 2017
Earnings Summary August 1, 2017 Second Quarter 2017 Exhibit 99.3
Slide 2: Cautionary Note Regarding Forward-Looking Statements
Genworth 2Q17 Earnings Presentation - August 1, 2017 This presentation contains certain “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by words such as “expects,” “anticipates,” “inte
Slide 3: Key Financial Themes For The 2nd Quarter
Key Financial Themes For The 2nd Quarter Financial Performance U.S. Mortgage Insurance (MI) Second Quarter 2017 Adjusted Operating Earnings Increased 49% Compared To the Second Quarter Of 2016, Which Includes A Favorable $10MM Reserve Adjustment In The Current Quarter U.S. MI PMIERs1 Capital Level A
Slide 4: 2Q17 Results Summary – Genworth Consolidated
2Q17 Results Summary – Genworth Consolidated U.S. MI: $91MM Continued Benefit In Net Cures & Aging Driving Favorable Reserve Adjustment Strong Loss Ratio Performance Canada MI: $41MM Decrease In New Delinquencies & Strong Cure Activity Strong Loss Ratio Performance Australia MI: $12MM Favorable Non-
Slide 5: U.S. Mortgage Insurance
U.S. Mortgage Insurance ($MM) ($MM) Benefits/Changes In Policy Reserves Premiums Flow NIW9,8007,60011,400 Loss Ratio2%17%24% Primary Delqs (#)20,67723,01925,798 Primary New Delqs (#)7,7768,4568,265 Primary Paid Claims1 (#)2,0331,5631,932 Primary Cures (#)8,0859,5838,137 % Of RIF2 2009+80%79%73% Prem
Slide 6: Canada Mortgage Insurance
Flow NIW3,7002,3004,400 Bulk NIW8008,00019,700 Canada Mortgage Insurance ($MM) ($MM) Loss Ratio4%16%20% Total Delqs (#)1,8092,0821,961 New Delqs (#)9651,2481,164 Paid Claims (#)428479425 Cures (#)810757812 Benefits/Changes In Policy Reserves Premiums Unfavorable $4MM Premium Impact From Foreign Exch
Slide 7: Australia Mortgage Insurance
Australia Mortgage Insurance ($MM) ($MM) Benefits/Changes In Policy Reserves Premiums Flow NIW4,1004,1005,000 Bulk NIW6001,000800 Loss Ratio34%35%36% Total Delqs (#)7,2856,9266,413 New Delqs (#)3,1452,8523,215 Paid Claims (#)355356286 Cures (#)2,4312,3012,405 Minimal Foreign Exchange (FX) Impact On
Slide 8: MI Businesses – Capital Adequacy
MI Businesses – Capital Adequacy1 1Company Estimate For 2Q17, Due To Timing Of The Filing Of Statutory Statements; 2Risk-To-Capital; 3Calculated As Available Assets Divided By Required Assets As Defined Within PMIERs. As of June 30, 2017, March 31, 2017 & June 30, 2016, The PMIERs Sufficiency Ratios
Slide 9: 2Q17 Summary – U.S. Life Insurance
2Q17 Summary – U.S. Life Insurance ($MM) Adjusted Operating Income (Loss) 39 53 55 Life Fixed Annuities LTC Highlights LTC: $33MM Sequentially Higher Premiums & Reserve Releases From Rate Increases & Associated Reduced Benefit Elections By Policyholders Favorable Seasonal Existing Claim Experience F
Slide 10: Long Term Care Insurance
Benefits & Other Changes In Policy Reserves & Loss Ratio (%) Long Term Care Insurance Results Reflect Current Low Interest Rate Environment & Variability In Prepayment Speeds, Limited Partnership Performance & Bond Call Income $62MM Estimated Pre-Tax Benefit In 2Q17 From Implemented In Force Premium
Slide 11: LTC In Force Premium Rate Increase
LTC In Force Premium Rate Increase Estimated Adjusted Operating Income From Rate Actions2 ($MM)186255 38599106 1Includes All Implemented Rate Actions Since 2012. Earned Premium & Reserve Change Estimates Reflect Certain Simplifying Assumptions That May Vary Materially From Actual Historical Results,
Slide 12: Life Insurance
Benefits & Other Changes In Policy Reserves Life Insurance Variability In Prepayment Speed Adjustments Impacting Reported Net Investment Income & Yield Unfavorable Mortality Versus Prior Year Reflects Run-Off Block & Elevated Lapses Primarily From Large 15-Year & 20-Year Term Life Insurance Blocks E
Slide 13: Fixed Annuities
SPDA2 Spread1.55%1.55%1.48% SPIA3 Spread1.19%0.88%0.69% Fixed Annuities 1Net Investment Income Less Interest Credited; 2Single Premium Deferred Annuities; Excludes Fixed Indexed Annuities; 3Single Premium Immediate Annuities; Includes Both Paid & Unpaid Interest Credited; 4Excludes Incurred But Not
Slide 14: Net Investment Income
1Non-GAAP Measure, See Appendix Genworth 2Q17 Earnings Presentation - August 1, 2017 Net Investment Income ($MM) Highlights Net Investment Income GNW Reported Yield4.57%4.53%4.48% GNW Core Yield14.47%4.48%4.48% U.S. Life Ins. Segment Reported Yield4.88%4.80%4.91% Impairments(2)(1)(22) Continued Vari
Slide 15: Holding Company Cash & Liquid Assets Roll Forward
Genworth 2Q17 Earnings Presentation - August 1, 2017 Variance (141) 1 Holding Company Cash & Liquid Assets Comprise Assets Held In Genworth Holdings, Inc. (The Issuer Of Outstanding Public Debt) Which Is A Wholly-Owned Subsidiary Of Genworth Financial, Inc.; 2 Comprises Cash & Cash Equivalents Of $7
Slide 16: Appendix
Appendix Genworth 2Q17 Earnings Presentation - August 1, 2017
Slide 17: Total Genworth Financial, Inc.'s Stockholders' Equity (GAAP)
Total Genworth Financial, Inc.’s Stockholders’ Equity (GAAP) ($MM) 2Q17 1Q17 4Q16 3Q16 2Q16 U.S. MI 2,270 2,183 2,070 2,089 2,015 Canada MI 1,676 1,617 1,565 1,601 1,592 Australia MI 719 701 651 687 706 U.S. Life Insurance 10,842 10,943 10,980 12,897 11,868 LTC1 7,328 7,420 7,621 8,957 8,155 Life In
Slide 18: Use Of Non-GAAP Measures
Use Of Non-GAAP Measures This presentation includes the non-GAAP financial measures entitled "adjusted operating income (loss)”. The chief operating decision maker evaluates segment performance and allocates resources on the basis of adjusted operating income (loss). The company defines adjusted ope
Slide 19: Reconciliation Of Net Income To Adjusted Operating Income
Reconciliation Of Net Income To Adjusted Operating Income Genworth 2Q17 Earnings Presentation - August 1, 2017
Slide 20: Reconciliation Of Core Yield To Reported Yield
Reconciliation Of Core Yield To Reported Yield Genworth 2Q17 Earnings Presentation - August 1, 2017
Slide 21: Definition Of Selected Operating Performance Measures
Definition Of Selected Operating Performance Measures Management uses selected operating performance measures including ''sales" and "insurance in force" or "risk in force" which are commonly used in the insurance industry as measures of operating performance. Management regularly monitors and repor
Slide 22: Cautionary Note Regarding Forward-Looking Statements
Cautionary Note Regarding Forward-Looking Statements This presentation contains certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by words such as “expects,” “intends,” “anticipates,” “plans,”
Slide 23: Cautionary Note Regarding Forward-Looking Statements
Cautionary Note Regarding Forward-Looking Statements Genworth 2Q17 Earnings Presentation - August 1, 2017 regulatory and legal risks including: extensive regulation of the company's businesses and changes in applicable laws and regulations; litigation and regulatory investigations or other actions;