NMI Holdings, Inc. Q1 FY2025 earnings call

• National MI delivered strong operating performance, continued growth in insured portfolio, and record financial results with $9.2 billion NIW volume and $211.3 billion primary insurance in force.
• Congratulated Bill Pulte on confirmation as FHFA Director and expressed excitement to work on housing goals.
• Extended long-term IP engagement with TCS to 2032, which is a positive for innovation and efficiency.
• Credit performance benefited from seasonal cure activity, balanced by portfolio growth and seasoning.
• Repurchased $25.9 million of common stock, with $304 million remaining under repurchase program.

In the first quarter, National MI generated $9.2 billion of NIW volume and ended the quarter with a record $211.3 billion of high-quality, high-performing primary insurance in force. Total revenue was a record $173.2 million, and GAAP net income was a record $102.6 million or $1.28 per diluted share with an 18.1% return on equity. Net premiums earned in the first quarter were a record $149.4 million. Investment income was $23.7 million. Underwriting and operating expenses were $30.2 million with an expense ratio of 20.2%. There were 6,859 defaults at March 31 with a default rate of 1%, and the average mark-to-market equity on the defaulted population was 73.2%. Shareholders' equity as of March 31 was $2.3 billion and book value per share was $29.65.

• Well positioned to continue serving customers, invest in employees, and drive growth in insured portfolio.
• Expect normalization of portfolio performance as underlying borrower experience normalizes.

• Macro environment uncertainty could impact performance.
• Emerging market volatility and tariffs could affect economic conditions and credit loss expectations.

Q: On credit side, vintage performance and equity in default A: Adam Pollitzer discussed vintage performance, noting normalized portfolio experience and Aurora Swithenbank mentioned average mark-to-market equity on defaulted population is 73.2% Q: TCS renewal impact on OpEx outlook A: Adam Pollitzer said renewal is a positive, expenses expected to be roughly same as current run rate Q: Buyback and portfolio bifurcation A: Aurora Swithenbank confirmed buyback of $25.9 million, Adam Pollitzer discussed portfolio consistency and no adverse selection from refinancing