Sagen MI Canada Inc · TSX:MIC.PR.A

Sagen MI Canada — Genworth MI Canada — Q1 2014 Earnings Presentation

13 slides from Sagen MI Canada's earnings presentation, Apr 30, 2014

  1. Slide 1: First Quarter 2014

    Genworth MI Canada Inc. First Quarter 2014 April 30, 2014

  2. Slide 2: Forward-looking and non-IFRS statements

    Forward-looking and non-IFRS statements This presentation relating to Genworth MI Canada Inc. (the “Company”, “Genworth Canada” or “MIC”) includes certain forward- looking statements. These forward-looking statements include, but are not limited to, statements with respect to the Company’s future op

  3. Slide 3: Financial highlights

    Financial highlights Key messages: Q1 2014 Q/Q  Solid earnings performance with QoQ EPS Net Operating Income $91 million +7% growth of 7%  Ongoing generation of capital Operating ROE 12% flat  $160 mm debt raise to repay existing debt Operating EPS (diluted) $0.96 +7% May 1, 2014  Announced a 15

  4. Slide 4: Recent development – OSFI B-21 Guideline

    Recent development – OSFI B-21 Guideline  On April 14, 2014 OSFI released for comment draft guideline B-21 entitled “Residential Mortgage Insurance Underwriting Practices and Procedures”, based on six principles: Principles 1 Maintain a comprehensive underwriting plan 2 Maintain standards for lende

  5. Slide 5: Market overview

    Market overview Influencer Impact to business Stable macro economic environment Continued strong loss performance this year Modest mortgage origination market growth Low interest rate environment continues – with stable debt ratios Improving first time home buyer confidence Core high loan-to-value p

  6. Slide 6: Strong insurance portfolio quality

    Strong insurance portfolio quality 720 726 727 727 730 733 734 Average Key messages: Credit Score 08 09 10 11 12 13 Q1'14  Credit score up 14 pts since 2008 ($000’s)  New business mix drove average home price up 4% in Q1 Average 284 296 301 304 315 Home Price 256 266  Gross debt ratios stable, st

  7. Slide 7: Delinquency trends

    Delinquency trends Number of Reported Delinquencies Key messages:  Modest increase in Q1 due to typical seasonality 1,963 1,860  Downward trend YoY driven by improving Other 1,778 1,778 1,830 249 employment and stable housing markets 252 284 255 259  Declining trend in most regions led by Quebec

  8. Slide 8: Financial overview – Q1 2014

    Financial overview – Q1 2014 $MM except EPS and BVPS Q1’14 Q4’13 Q1’13 Key messages: Net premiums written $84 $129 $84  Premiums written reflect Net premiums earned 141 142 144 typical seasonality  Premiums earned flat Losses on claims 28 31 44  Loss ratio of 20% reflects Expenses 27 33 26 favour

  9. Slide 9: Impact from premium increase

    Impact from premium increase Premiums Written Premiums Earned 15% premium rate increase effective May 1 Limited impact from price increase on premiums earned in 2014 / 15 due to Standard Product Current New earnings curve 90.01 – 95% LTV 2.75% 3.15% 85.01 – 90% LTV 2.00% 2.40% Premiums 80.01 – 85% L

  10. Slide 10: Profitability driven by low losses

    Profitability driven by low losses Underwriting profitability ($millions) Key messages: Premiums earned $144 $143 $143 $142 $141  Q1 loss ratio of 20% below expected range Losses on claims 35 32 31 28  Expense ratio of 19% in line with management’s 44 expectation 26 27 33 27 Expenses 26 Underwriti

  11. Slide 11: Investments contribute steady income

    Investments contribute steady income Key messages:  Focus on high investment quality Common Equity Cash  Diversified portfolio with over 50% 4% 3% government and cash  Relatively short duration Corporates Federal 44% 33% Total $5.2 billion Portfolio Assets (market value) $5.2 billion Pre-tax yiel

  12. Slide 12: Strong capital position

    Strong capital position Minimum Capital Test Ratio (MCT) Key messages:  Continuing to balance capital strength, 216% 216% 218% 223% 229% flexibility and efficiency 31% 33% 38% 44%  Subsequent to quarter end, successfully 31% extended debt maturity profile  Issued $160 MM 10 year unsecured debt @

  13. Slide 13: Question and Answer

    Question and Answer SAMANTHA CHEUNG Contact: VP INVESTOR RELATIONS 905 287 5482 samantha.cheung@genworth.com www.genworth.ca Genworth MI Canada Inc. 13 Q1 2014

Genworth MI Canada — Q1 2014 Earnings Presentation on 6ix