Sagen MI Canada Inc · TSX:MIC.PR.A

Sagen MI Canada — Genworth MI Canada — Q3 2015 Earnings Presentation

16 slides from Sagen MI Canada's earnings presentation, Oct 30, 2015

  1. Slide 1: Third Quarter 2015 Results

    Genworth MI Canada Inc. ©2015 Google Third Quarter 2015 Results October 30th, 2015

  2. 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

  3. Slide 3: Q3 2015 financial results

    Q3 2015 financial results $MM except ROE, Q3 Q2 Q3 Q/Q Y/Y EPS and MCT 2015 2015 2014 Highlights  Strong top line growth of +20% Y/Y Premiums written $260 $205 $217 +27% +20%  Loss ratio of 21% Loss ratio 21% 17% 21% +4 pts Flat  Operating income flat Q/Q Net Operating Income $92 $92 $93 Flat Fla

  4. Slide 4: Stable delinquency trend

    Stable delinquency trend Outstanding Delinquencies Relatively flat YoY 1,708 1,756 1,792 1,666 1,715 92 102 Prairies1 74 97 113 207 216 Atlantic 199 191 198 Highlights Quebec 516 569 584 578 579  Delinquencies up 3% Q/Q, primarily reflecting Alberta 207 222 220 seasonality 227 258 BC2 281 271 263 2

  5. Slide 5: Q3 2015 Genworth's served market

    Q3 2015 Genworth’s served market Average Average Average City Average Home Price Gross Debt Credit Income Servicing Score Genworth Market % Variance Genworth Genworth Genworth Vancouver $519K $881K -41% $125K 28% 754 Toronto $472K $626K -25% $107K 29% 750 Calgary $425K $454K -6% $109K 27% 749 Montre

  6. Slide 6: Solid financial performance

    Solid financial performance ($MM except EPS and BVPS) Q3’15 Q2’15 Q3’14 Highlights Transactional premiums written $236 $183 $191  Premiums Written higher by 20% Y/Y Portfolio premiums written 24 22 25 primarily due to market penetration and 2014 & 2015 premium rate increases Premiums written $260 $

  7. Slide 7: Strong premiums written growth

    Strong premiums written growth Transactional Premiums Written Premiums Earned ($ millions) ($ millions) $422 $435 $165 +3% +132 $236 $148 Q4 $119 +63 Q3 $140 Vol = $75 $191 Price = $57 3QYTD Q3 $144 = $523 3QYTD Q2 $141 $144 3QYTD $183 = $390 = $328 $128 Q2 $111 $104 Q1 $141 $143 Q1 $73 $71 2013 YTD

  8. Slide 8: Solid underwriting profitability

    Solid underwriting profitability Underwriting Profitability ($millions) Premiums earned $140 $143 $143 $144 $148 Highlights 31 Losses on claims 30 37 31 25  Consistently strong underwriting 29 28 performance Expenses 24 24 30 Underwriting  YTD loss ratio of 20% at bottom of full profit year loss r

  9. Slide 9: Investments contribute steady income

    Investments contribute steady income Total Invested Assets Fixed income rating distribution: Highlights AAA = 43% AA = 20% A = 27% BBB = 10%  Focus on high quality investments Preferred Cash, 4% Equity, 3%  93%1 of the portfolio is fixed income, 100% of which is Investment Grade  Low rate environ

  10. Slide 10: Strong capital position

    Strong capital position Minimum Capital Test Ratio (MCT) (amounts in C$M, MCT in %)1,2 228% 233% 231% 227% Highlights  Increased dividend in Q3’15 by 8% to $0.42 per share 117 165  Holding company cash and liquid securities of 198 $120 million Excess 116 capital over  3,466 220% Intend to operate

  11. Slide 11: Alberta: Proactive risk management

    Alberta: Proactive risk management Regional NIW Dispersion (Transactional)1 100% 13% 11% 13% Highlights 80% 12% 13% 13%  Underwriting actions resulting in smaller but 12% 16% 10% better quality Alberta portfolio in 2015 60%  Reduced exposure to areas in Alberta that are 40% 37% 35% 42% more depend

  12. Slide 12: Alberta: Portfolio quality

    Alberta: Portfolio quality 750 738 20% 740 15% 17% Average 730 Credit Score 720 713 10% Highlights 710 5% 700 5% 0%  Steady credit score improvement year- '07 '08 '09 '10 '11 '12 '13 '14 ' 15 YTD over-year % Score <660 (R) Avg Score (L)  Less exposure to higher risk products 332 327 344 352 355 35

  13. Slide 13: 2016 loss ratio expectations

    2016 loss ratio expectations MIC Loss Ratio & CBA1 Delinquency Rates2 CBA Delinquency MIC Loss Rates Alberta Ratio Highlights delq. rate 0.9% 50%  Annual loss ratio peaked in 2009 at 42% as 0.8% house price over-valuation in Alberta and 0.7% 40% high risk products contributed to elevated 0.6% 2016

  14. Slide 14: Underwriting performance scorecard

    Underwriting performance scorecard 2015 2015 Observations Objective YTD New Insurance Written Moderate Transactional Volume 19% Growth Realizing market share gains in a larger origination market while maintaining strong Average Credit Score > 725 742 portfolio quality Gross Debt Servicing < 26% 24%

  15. Slide 15: Key takeaways

    Key takeaways  Solid results this quarter with strong profitability and top line growth  Prudent market share expansion with keen focus on portfolio quality & diversification  Proven business model  Well-positioned for solid operating performance Genworth MI Canada Inc. 15 Q3 2015

  16. Slide 16: Question & Answer Session

    Genworth MI Canada Inc. Question & Answer Session Investor Relations Jonathan A. Pinto, MBA, LL.M Vice President, Investor Relations 905.287.5482 jonathan.pinto@genworth.com investor.genworthmicanada.ca Genworth MI Canada Inc. 16 Q3 2015

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