Essent Group Ltd. (NYSE: ESNT) today reported net income for the
quarter ended June 30, 2024 of $203.6 million or $1.91 per diluted
share, compared to $172.2 million or $1.61 per diluted share for
the quarter ended June 30, 2023.
Essent also announced today that its Board of Directors has
declared a quarterly cash dividend of $0.28 per common share. The
dividend is payable on September 10, 2024, to shareholders of
record on August 30, 2024.
“We are pleased with our financial results in the second
quarter, as our high-quality portfolio and resilience in the
housing and labor markets translated to favorable credit
performance, and the current rate environment continues to benefit
investment income and persistency,” said Mark A. Casale, Chairman
and Chief Executive Officer. “The Essent franchise achieved another
milestone by closing on our inaugural senior debt offering on July
1. Combined with an amended and extended revolving credit facility,
we now have over $1.3 billion in available holding company
liquidity.”
Financial Highlights:
- New insurance written for the second quarter of 2024 was $12.5
billion, compared to $8.3 billion in the first quarter of 2024 and
$13.5 billion in the second quarter of 2023.
- Insurance in force as of June 30, 2024 was $240.7 billion,
compared to $238.5 billion as of March 31, 2024 and $235.6 billion
as of June 30, 2023.
- Net investment income for the first half of 2024 was $108.2
million, up 22% from the first half of 2023.
- Effective July 1, 2024, we entered into an excess of loss
transaction with a panel of highly rated third-party reinsurers
covering 15% of all eligible policies written by Essent Guaranty,
Inc. in calendar year 2024.
- On July 1, 2024, Essent closed two transactions that represent
approximately $1 billion in total debt capacity, comprised of $500
million of senior unsecured notes and a $500 million unsecured
revolving credit facility.
Conference Call:
Essent management will hold a conference call at 10:00 AM
Eastern time today to discuss its results. The conference call will
be broadcast live over the Internet at
http://ir.essentgroup.com/events-and-presentations/events/default.aspx.
The call may also be accessed by dialing 888-330-2384 inside the
U.S., or 240-789-2701 for international callers, using passcode
9824537 or by referencing Essent.
A replay of the webcast will be available on the Essent website
approximately two hours after the live broadcast ends for a period
of one year. A replay of the conference call will be available
approximately two hours after the call ends for a period of two
weeks, using the following dial-in numbers and passcode:
800-770-2030 inside the U.S., or 647-362-9199 for international
callers, passcode 9824537.
In addition to the information provided in the Company's
earnings news release, other statistical and financial information,
which may be referred to during the conference call, will be
available on Essent's website at
http://ir.essentgroup.com/financials/quarterly-results/default.aspx.
Forward-Looking Statements:
This press release may include “forward-looking statements”
which are subject to known and unknown risks and uncertainties,
many of which may be beyond our control. Forward-looking statements
generally can be identified by the use of forward-looking
terminology such as "may," "will," “should,” “expect,” "plan,"
"anticipate," "believe," “estimate,” “predict,” or "potential" or
the negative thereof or variations thereon or similar terminology.
Actual events, results and outcomes may differ materially from our
expectations due to a variety of known and unknown risks,
uncertainties and other factors. Although it is not possible to
identify all of these risks and factors, they include, among
others, the following: changes in or to Fannie Mae and Freddie Mac
(the “GSEs”), whether through Federal legislation, restructurings
or a shift in business practices; failure to continue to meet the
mortgage insurer eligibility requirements of the GSEs; competition
for customers or the loss of a significant customer; lenders or
investors seeking alternatives to private mortgage insurance; an
increase in the number of loans insured through Federal government
mortgage insurance programs; decline in the volume of low down
payment mortgage originations; uncertainty of loss reserve
estimates; decrease in the length of time our insurance policies
are in force; deteriorating economic conditions; and other risks
and factors described in Part I, Item 1A “Risk Factors” of our
Annual Report on Form 10-K for the year ended December 31, 2023
filed with the Securities and Exchange Commission on February 16,
2024, as subsequently updated through other reports we file with
the Securities and Exchange Commission. Any forward-looking
information presented herein is made only as of the date of this
press release, and we do not undertake any obligation to update or
revise any forward-looking information to reflect changes in
assumptions, the occurrence of unanticipated events, or
otherwise.
About the Company:
Essent Group Ltd. (NYSE: ESNT) is a Bermuda-based holding
company (collectively with its subsidiaries, “Essent”) offering
private mortgage insurance, reinsurance, and title insurance and
settlement services to serve the housing finance industry.
Additional information regarding Essent may be found at
www.essentgroup.com.
Source: Essent Group Ltd.
Essent Group Ltd. and
Subsidiaries
Financial Results and
Supplemental Information (Unaudited)
Quarter Ended June 30,
2024
Exhibit A
Condensed Consolidated Statements of
Comprehensive Income (Unaudited)
Exhibit B
Condensed Consolidated Balance Sheets
(Unaudited)
Exhibit C
Consolidated Historical Quarterly Data
Exhibit D
U.S. Mortgage Insurance Portfolio
Historical Quarterly Data
Exhibit E
New Insurance Written - U.S. Mortgage
Insurance Portfolio
Exhibit F
Insurance in Force and Risk in Force -
U.S. Mortgage Insurance Portfolio
Exhibit G
Other Risk in Force
Exhibit H
U.S. Mortgage Insurance Portfolio Vintage
Data
Exhibit I
U.S. Mortgage Insurance Portfolio
Reinsurance Vintage Data
Exhibit J
U.S. Mortgage Insurance Portfolio
Geographic Data
Exhibit K
Rollforward of Defaults and Reserve for
Losses and LAE - U.S. Mortgage Insurance Portfolio
Exhibit L
Detail of Reserves by Default Delinquency
- U.S. Mortgage Insurance Portfolio
Exhibit M
Investments Available for Sale
Exhibit N
U.S. Mortgage Insurance Company
Capital
Exhibit O
Ratios and Reconciliation of Non-GAAP
Financial Measures
Exhibit A
Essent Group Ltd. and
Subsidiaries
Condensed Consolidated
Statements of Comprehensive Income (Unaudited)
Three Months Ended June
30,
Six Months Ended June
30,
(In thousands,
except per share amounts)
2024
2023
2024
2023
Revenues:
Direct premiums written
$
272,910
$
249,167
$
541,841
$
488,658
Ceded premiums
(27,344
)
(39,546
)
(57,735
)
(73,137
)
Net premiums written
245,566
209,621
484,106
415,521
Decrease in unearned premiums
6,325
3,608
13,375
8,966
Net premiums earned
251,891
213,229
497,481
424,487
Net investment income
56,086
45,250
108,171
88,486
Realized investment gains (losses),
net
(1,164
)
(1,589
)
(2,304
)
(2,077
)
Income (loss) from other invested
assets
(419
)
(4,852
)
(2,334
)
(7,554
)
Other income
6,548
8,090
10,285
13,032
Total revenues
312,942
260,128
611,299
516,374
Losses and expenses:
Provision (benefit) for losses and LAE
(334
)
1,260
9,579
1,080
Other underwriting and operating
expenses
55,987
42,174
113,336
90,369
Premiums retained by agents
10,215
—
19,706
—
Interest expense
7,849
7,394
15,711
14,330
Total losses and expenses
73,717
50,828
158,332
105,779
Income before income taxes
239,225
209,300
452,967
410,595
Income tax expense
35,616
37,067
67,639
67,535
Net income
$
203,609
$
172,233
$
385,328
$
343,060
Earnings per share:
Basic
$
1.93
$
1.62
$
3.65
$
3.22
Diluted
1.91
1.61
3.61
3.20
Weighted average shares
outstanding:
Basic
105,657
106,249
105,677
106,594
Diluted
106,778
107,093
106,774
107,338
Net income
$
203,609
$
172,233
$
385,328
$
343,060
Other comprehensive income
(loss):
Change in unrealized appreciation
(depreciation) of investments
(5,375
)
(36,098
)
(27,141
)
22,655
Total other comprehensive income
(loss)
(5,375
)
(36,098
)
(27,141
)
22,655
Comprehensive income
$
198,234
$
136,135
$
358,187
$
365,715
Exhibit B
Essent Group Ltd. and
Subsidiaries
Condensed Consolidated Balance
Sheets (Unaudited)
June 30,
December 31,
(In thousands,
except per share amounts)
2024
2023
Assets
Investments
Fixed maturities available for sale, at
fair value
$
3,931,471
$
4,335,008
Short-term investments available for sale,
at fair value
1,523,512
928,731
Total investments available for sale
5,454,983
5,263,739
Other invested assets
282,781
277,226
Total investments
5,737,764
5,540,965
Cash
197,402
141,787
Accrued investment income
35,534
35,689
Accounts receivable
56,974
63,266
Deferred policy acquisition costs
9,199
9,139
Property and equipment
42,905
41,304
Prepaid federal income tax
487,456
470,646
Goodwill and intangible assets, net
70,258
72,826
Other assets
55,253
51,051
Total assets
$
6,692,745
$
6,426,673
Liabilities and Stockholders'
Equity
Liabilities
Reserve for losses and LAE
$
260,688
$
260,095
Unearned premium reserve
126,938
140,285
Net deferred tax liability
381,393
362,753
Credit facility borrowings, net of
deferred costs
422,448
421,920
Other accrued liabilities
121,488
139,070
Total liabilities
1,312,955
1,324,123
Commitments and contingencies
Stockholders' Equity
Common shares, $0.015 par value:
Authorized - 233,333; issued and
outstanding - 106,372 shares in 2024 and 106,597 shares in 2023
1,596
1,599
Additional paid-in capital
1,278,918
1,299,869
Accumulated other comprehensive loss
(307,637
)
(280,496
)
Retained earnings
4,406,913
4,081,578
Total stockholders' equity
5,379,790
5,102,550
Total liabilities and stockholders'
equity
$
6,692,745
$
6,426,673
Return on average equity (1)
14.7
%
14.6
%
(1) The 2024 return on average
equity is calculated by dividing annualized year-to-date 2024 net
income by average equity. The 2023 return on average equity is
calculated by dividing full year 2023 net income by average
equity.
Exhibit C
Essent Group Ltd. and
Subsidiaries
Supplemental
Information
Consolidated Historical
Quarterly Data
2024
2023
Selected Income Statement Data
June 30
March 31
December 31
September 30
June 30
(In thousands,
except per share amounts)
Revenues:
Net premiums earned:
U.S. Mortgage Insurance Portfolio
$
217,513
$
212,479
$
211,083
$
209,351
$
195,502
GSE and other risk share
17,745
17,826
17,166
16,850
17,727
Title insurance
16,633
15,285
17,365
20,604
—
Net premiums earned
251,891
245,590
245,614
246,805
213,229
Net investment income
56,086
52,085
50,581
47,072
45,250
Realized investment (losses) gains,
net
(1,164
)
(1,140
)
(4,892
)
(235
)
(1,589
)
(Loss) income from other invested
assets
(419
)
(1,915
)
(421
)
(3,143
)
(4,852
)
Other income (loss) (1)
6,548
3,737
6,395
5,609
8,090
Total revenues
312,942
298,357
297,277
296,108
260,128
Losses and expenses:
Provision (benefit) for losses and LAE
(334
)
9,913
19,640
10,822
1,260
Other underwriting and operating
expenses
55,987
57,349
55,248
54,814
42,174
Premiums retained by agents
10,215
9,491
11,475
13,175
—
Interest expense
7,849
7,862
7,953
7,854
7,394
Total losses and expenses
73,717
84,615
94,316
86,665
50,828
Income before income taxes
239,225
213,742
202,961
209,443
209,300
Income tax expense (2)
35,616
32,023
27,594
31,484
37,067
Net income
$
203,609
$
181,719
$
175,367
$
177,959
$
172,233
Earnings per share:
Basic
$
1.93
$
1.72
$
1.66
$
1.68
$
1.62
Diluted
1.91
1.70
1.64
1.66
1.61
Weighted average shares
outstanding:
Basic
105,657
105,697
105,733
105,979
106,249
Diluted
106,778
106,770
106,823
107,025
107,093
Book value per share
$
50.58
$
48.96
$
47.87
$
44.98
$
44.24
Return on average equity
(annualized)
15.4
%
14.1
%
14.2
%
14.9
%
14.7
%
Credit Facility
Borrowings outstanding
$
425,000
$
425,000
$
425,000
$
425,000
$
425,000
Undrawn committed capacity
$
400,000
$
400,000
$
400,000
$
400,000
$
400,000
Weighted average interest rate (end of
period)
7.07
%
7.06
%
7.11
%
7.07
%
6.87
%
Debt-to-capital
7.32
%
7.52
%
7.69
%
8.12
%
8.24
%
(1) Other income includes net
favorable (unfavorable) changes in the fair value of embedded
derivatives associated with certain of our third-party reinsurance
agreements, which for the quarters ended June 30, 2024, March 31,
2024, December 31, 2023, September 30, 2023, and June 30, 2023,
were $732, ($1,902), $412, ($898), and $2,726, respectively.
(2) Income tax expense for the
quarters ended June 30,2024, March 31, 2024, December 31, 2023,
September 30, 2023, and June 30, 2023 includes $556, ($1,041),
($1,132), ($763), and ($888), respectively, of discrete tax expense
(benefit) associated with realized and unrealized gains and losses.
Income tax expense for the quarter ended March 31, 2024 also
includes ($616) of excess tax benefits associated with the vesting
of common shares and common share units. Income tax expense for the
quarter ended December 31, 2023 also includes a $2,731 net benefit
associated with the recognition of a deferred tax asset for
unrealized losses on the investment portfolios of Essent Group and
Essent Re upon the enactment of the Bermuda Corporate Income Tax.
Income tax expense for the quarter ended June 30, 2023 also
includes $5,295 of net discrete tax expense associated with prior
year tax returns.
Exhibit D
Essent Group Ltd. and
Subsidiaries
Supplemental
Information
U.S. Mortgage Insurance
Portfolio Historical Quarterly Data
2024
2023
Other Data:
June 30
March 31
December 31
September 30
June 30
($ in
thousands)
U.S. Mortgage Insurance
Portfolio
New insurance written
$
12,503,125
$
8,323,544
$
8,769,160
$
12,505,823
$
13,498,080
New risk written
3,449,623
2,289,508
2,409,340
3,458,467
3,726,513
Average insurance in force
$
239,538,571
$
238,595,268
$
239,005,961
$
237,270,093
$
233,484,941
Insurance in force (end of period)
$
240,669,165
$
238,477,402
$
239,078,262
$
238,661,612
$
235,649,884
Gross risk in force (end of period)
(1)
$
65,269,064
$
64,247,810
$
64,061,374
$
63,605,057
$
62,403,400
Risk in force (end of period)
$
55,521,538
$
54,686,533
$
54,591,590
$
53,920,308
$
53,290,643
Policies in force
814,237
815,752
822,012
825,248
821,690
Weighted average coverage (2)
27.1
%
26.9
%
26.8
%
26.7
%
26.5
%
Annual persistency
86.7
%
86.9
%
86.9
%
86.6
%
85.8
%
Loans in default (count)
13,954
13,992
14,819
13,391
12,480
Percentage of loans in default
1.71
%
1.72
%
1.80
%
1.62
%
1.52
%
U.S. Mortgage Insurance Portfolio
premium rate:
Base average premium rate (3)
0.41
%
0.41
%
0.40
%
0.40
%
0.40
%
Single premium cancellations
(4)
—
%
—
%
—
%
—
%
—
%
Gross average premium rate
0.41
%
0.41
%
0.40
%
0.40
%
0.40
%
Ceded premiums
(0.05
%)
(0.05
%)
(0.05
%)
(0.05
%)
(0.07
%)
Net average premium rate
0.36
%
0.36
%
0.35
%
0.35
%
0.33
%
(1) Gross risk in force includes
risk ceded under third-party reinsurance.
(2) Weighted average coverage is
calculated by dividing end of period gross risk in force by end of
period insurance in force.
(3) Base average premium rate is
calculated by dividing annualized base premiums earned by average
insurance in force for the period.
(4) Single premium cancellations is
calculated by dividing annualized premiums on the cancellation of
non-refundable single premium policies by average insurance in
force for the period.
Exhibit E
Essent Group Ltd. and
Subsidiaries
Supplemental Information -
U.S. Mortgage Insurance Portfolio
New Insurance Written:
Flow
NIW by Credit Score
Three Months Ended
Six Months Ended
June 30, 2024
June 30, 2023
June 30, 2024
June 30, 2023
($ in
thousands)
>=760
$
5,451,182
43.6
%
$
5,413,790
40.1
%
$
9,047,782
43.4
%
$
10,260,848
38.9
%
740-759
2,165,026
17.3
2,428,773
18.0
3,575,472
17.2
4,826,755
18.3
720-739
1,819,751
14.6
2,194,400
16.3
3,064,399
14.7
4,399,244
16.7
700-719
1,585,167
12.7
2,022,302
15.0
2,725,597
13.1
4,025,194
15.2
680-699
870,054
7.0
1,032,061
7.6
1,433,473
6.9
2,132,876
8.1
<=679
611,945
4.8
406,754
3.0
979,946
4.7
746,952
2.8
Total
$
12,503,125
100.0
%
$
13,498,080
100.0
%
$
20,826,669
100.0
%
$
26,391,869
100.0
%
Weighted average credit score
748
746
748
746
NIW by LTV
Three Months Ended
Six Months Ended
June 30, 2024
June 30, 2023
June 30, 2024
June 30, 2023
($ in
thousands)
85.00% and below
$
854,349
6.8
%
$
988,752
7.3
%
$
1,414,248
6.8
%
$
1,951,761
7.4
%
85.01% to 90.00%
2,423,665
19.4
2,819,310
20.9
4,155,796
20.0
5,505,138
20.9
90.01% to 95.00%
6,874,853
55.0
7,339,533
54.4
11,392,508
54.7
14,769,646
55.9
95.01% and above
2,350,258
18.8
2,350,485
17.4
3,864,117
18.5
4,165,324
15.8
Total
$
12,503,125
100.0
%
$
13,498,080
100.0
%
$
20,826,669
100.0
%
$
26,391,869
100.0
%
Weighted average LTV
93
%
93
%
93
%
93
%
NIW by Product
Three Months Ended
Six Months Ended
June 30, 2024
June 30, 2023
June 30, 2024
June 30, 2023
Single Premium policies
1.3
%
4.3
%
1.6
%
4.1
%
Monthly Premium policies
98.7
95.7
98.4
95.9
100.0
%
100.0
%
100.0
%
100.0
%
NIW by Purchase vs.
Refinance
Three Months Ended
Six Months Ended
June 30, 2024
June 30, 2023
June 30, 2024
June 30, 2023
Purchase
97.8
%
98.8
%
97.6
%
98.7
%
Refinance
2.2
1.2
2.4
1.3
100.0
%
100.0
%
100.0
%
100.0
%
Exhibit F
Essent Group Ltd. and
Subsidiaries
Supplemental
Information
Insurance in Force and Risk in
Force - U.S. Mortgage Insurance Portfolio
Portfolio by Credit
Score
IIF by FICO score
June 30, 2024
March 31, 2024
June 30, 2023
($ in
thousands)
>=760
$
97,668,435
40.6
%
$
96,712,431
40.6
%
$
95,925,520
40.8
%
740-759
41,915,598
17.4
41,477,680
17.4
40,733,799
17.3
720-739
37,678,804
15.7
37,342,339
15.7
36,791,104
15.6
700-719
32,331,564
13.4
32,023,895
13.4
30,970,132
13.1
680-699
19,751,956
8.2
19,664,999
8.2
19,667,866
8.3
<=679
11,322,808
4.7
11,256,058
4.7
11,561,463
4.9
Total
$
240,669,165
100.0
%
$
238,477,402
100.0
%
$
235,649,884
100.0
%
Weighted average credit score
746
746
746
Gross RIF by FICO score
June 30, 2024
March 31, 2024
June 30, 2023
($ in
thousands)
>=760
$
26,238,140
40.2
%
$
25,806,552
40.2
%
$
25,138,762
40.3
%
740-759
11,525,987
17.7
11,326,253
17.6
10,922,780
17.5
720-739
10,362,021
15.9
10,206,055
15.9
9,896,425
15.9
700-719
8,899,342
13.6
8,757,648
13.6
8,319,353
13.3
680-699
5,382,312
8.2
5,321,802
8.3
5,248,349
8.4
<=679
2,861,262
4.4
2,829,500
4.4
2,877,731
4.6
Total
$
65,269,064
100.0
%
$
64,247,810
100.0
%
$
62,403,400
100.0
%
Portfolio by LTV
IIF by LTV
June 30, 2024
March 31, 2024
June 30, 2023
($ in
thousands)
85.00% and below
$
16,927,111
7.0
%
$
18,397,395
7.7
%
$
22,427,649
9.5
%
85.01% to 90.00%
61,774,991
25.7
62,218,749
26.1
63,562,258
27.0
90.01% to 95.00%
123,414,332
51.3
120,666,455
50.6
115,768,826
49.1
95.01% and above
38,552,731
16.0
37,194,803
15.6
33,891,151
14.4
Total
$
240,669,165
100.0
%
$
238,477,402
100.0
%
$
235,649,884
100.0
%
Weighted average LTV
93
%
93
%
93
%
Gross RIF by LTV
June 30, 2024
March 31, 2024
June 30, 2023
($ in
thousands)
85.00% and below
$
2,010,864
3.1
%
$
2,188,074
3.4
%
$
2,667,981
4.3
%
85.01% to 90.00%
15,238,201
23.3
15,329,091
23.9
15,583,198
25.0
90.01% to 95.00%
36,405,573
55.8
35,556,840
55.3
34,026,320
54.5
95.01% and above
11,614,426
17.8
11,173,805
17.4
10,125,901
16.2
Total
$
65,269,064
100.0
%
$
64,247,810
100.0
%
$
62,403,400
100.0
%
Portfolio by Loan Amortization
Period
IIF by Loan Amortization Period
June 30, 2024
March 31, 2024
June 30, 2023
($ in
thousands)
FRM 30 years and higher
$
235,138,420
97.7
%
$
232,753,590
97.6
%
$
228,745,641
97.1
%
FRM 20-25 years
1,322,021
0.5
1,473,431
0.6
2,124,690
0.9
FRM 15 years
1,276,780
0.5
1,359,795
0.6
1,953,448
0.8
ARM 5 years and higher
2,931,944
1.3
2,890,586
1.2
2,826,105
1.2
Total
$
240,669,165
100.0
%
$
238,477,402
100.0
%
$
235,649,884
100.0
%
Exhibit G
Essent Group Ltd. and
Subsidiaries
Supplemental
Information
Other Risk in Force
2024
2023
($ in
thousands)
June 30
March 31
December 31
September 30
June 30
GSE and other risk share (1):
Risk in Force
$
2,304,885
$
2,307,267
$
2,244,944
$
2,247,393
$
2,276,702
Reserve for losses and LAE
$
33
$
32
$
29
$
54
$
55
Weighted average credit score
750
750
749
749
749
Weighted average LTV
82
%
82
%
82
%
82
%
83
%
(1) GSE and other risk share
includes GSE risk share and other reinsurance transactions. Essent
Reinsurance Ltd. ("Essent Re") provides insurance or reinsurance
relating to the risk in force on loans in reference pools acquired
by Freddie Mac and Fannie Mae.
Exhibit H
Essent Group Ltd. and
Subsidiaries
Supplemental
Information
U.S. Mortgage Insurance
Portfolio Vintage Data
June 30, 2024
Insurance in Force
Year
Original
Insurance
Written
($ in thousands)
Remaining
Insurance
in Force
($ in thousands)
% Remaining of
Original
Insurance
Number of Policies in
Force
Weighted Average
Coupon
% Purchase
>90% LTV
>95% LTV
FICO < 700
FICO >= 760
Incurred Loss Ratio (Inception
to Date) (1)
Number of Loans in
Default
Percentage of Loans in
Default
2010 - 2014
$
60,668,851
$
1,047,692
1.7
%
5,772
4.28
%
66.1
%
49.8
%
1.2
%
10.3
%
49.0
%
2.4
%
252
4.37
%
2015
26,193,656
1,038,672
4.0
6,156
4.27
79.8
66.5
5.5
18.1
39.1
2.3
245
3.98
2016
34,949,319
2,570,524
7.4
15,203
3.92
86.8
79.2
13.3
16.3
41.6
2.0
427
2.81
2017
43,858,322
4,139,552
9.4
25,251
4.29
91.1
77.1
22.5
21.2
36.6
3.1
990
3.92
2018
47,508,525
5,073,930
10.7
28,900
4.80
95.1
73.3
26.7
21.8
32.4
4.1
1,257
4.35
2019
63,569,183
11,216,155
17.6
54,299
4.23
88.9
71.1
25.6
18.9
35.2
3.8
1,635
3.01
2020
107,944,065
40,789,474
37.8
159,965
3.20
71.0
60.5
14.0
10.9
45.5
2.6
2,153
1.35
2021
84,218,250
55,842,833
66.3
185,000
3.09
88.2
65.1
16.3
13.8
40.4
6.0
3,042
1.64
2022
63,061,262
54,555,338
86.5
156,491
5.08
98.0
65.8
11.4
12.6
39.6
16.8
2,598
1.66
2023
47,666,852
43,986,658
92.3
123,145
6.65
98.8
72.7
18.5
11.0
38.9
15.7
1,297
1.05
2024 (through June 30)
20,826,669
20,408,337
98.0
54,055
6.88
97.6
73.4
18.8
11.7
42.9
5.8
58
0.11
Total
$
600,464,954
$
240,669,165
40.1
814,237
4.66
90.3
67.3
16.0
12.9
40.6
4.3
13,954
1.71
(1) Incurred loss ratio is
calculated by dividing the sum of case reserves and cumulative
amount paid for claims by cumulative net premiums earned.
Exhibit I
Essent Group Ltd. and
Subsidiaries
Supplemental
Information
U.S. Mortgage Insurance
Portfolio Reinsurance Vintage Data
June 30, 2024
($ in
thousands)
Insurance Linked
Notes (1)
Earned Premiums Ceded
Deal Name
Vintage
Remaining
Insurance
in Force
Remaining
Risk
in Force
Original
Reinsurance in Force
Remaining
Reinsurance in Force
Losses
Ceded
to Date
Original
First Layer
Retention
Remaining
First Layer
Retention
Quarter-to-Date
Year-to-Date
Reduction in PMIERs Minimum
Required
Assets (3)
Radnor Re 2021-1
Aug. 2020 - Mar. 2021
$
27,796,132
$
7,390,779
$
557,911
$
250,732
$
—
$
278,956
$
278,227
$
2,148
$
4,473
$
174,722
Radnor Re 2021-2
Apr. 2021 - Sep. 2021
32,876,424
9,007,485
439,407
301,015
—
279,415
277,770
3,563
7,237
239,363
Radnor Re 2022-1
Oct. 2021 - Jul. 2022
29,790,115
8,096,398
237,868
209,409
—
303,761
302,032
3,736
7,653
192,656
Radnor Re 2023-1
Aug. 2022 - Jun. 2023
29,594,148
8,102,672
281,462
281,462
—
281,463
281,434
3,473
6,952
266,826
Total
$
120,056,819
$
32,597,334
$
1,516,648
$
1,042,618
$
—
$
1,143,595
$
1,139,463
$
12,920
$
26,315
(5)
$
873,567
Excess of Loss
Reinsurance (2)
Earned Premiums Ceded
Deal Name
Vintage
Remaining
Insurance
in Force
Remaining
Risk
in Force
Original
Reinsurance in Force
Remaining
Reinsurance in Force
Losses
Ceded
to Date
Original
First Layer
Retention
Remaining
First Layer
Retention
Quarter-to-Date
Year-to-Date
Reduction in PMIERs Minimum
Required
Assets (3)
XOL 2019-1
Jan. 2018 - Dec. 2018
$
5,024,587
$
1,321,732
$
118,650
$
76,144
$
—
$
253,643
$
244,991
$
607
$
1,227
$
—
XOL 2020-1
Jan. 2019 - Aug. 2019
6,290,687
1,658,671
55,102
32,770
—
215,605
212,557
267
547
—
XOL 2022-1
Oct. 2021 - Dec. 2022
67,094,902
18,213,963
141,992
141,992
—
507,114
502,788
1,593
3,186
137,802
XOL 2023-1
Jan. 2023 - Dec. 2023
39,252,349
10,868,626
36,627
36,627
—
366,270
366,154
434
868
35,310
Total
$
117,662,525
$
32,062,992
$
352,371
$
287,533
$
—
$
1,342,632
$
1,326,490
$
2,901
$
5,828
$
173,112
Quota Share
Reinsurance (2)
Losses Ceded
Ceding Commission
Earned Premiums Ceded
Year
Ceding Percentage
Remaining
Insurance
in Force
Remaining
Risk
in Force
Remaining Ceded Insurance in
Force
Remaining Ceded Risk in
Force
Quarter-to-Date
Year-to-Date
Quarter-to-Date
Year-to-Date
Quarter-to-Date
Year-to-Date
Reduction in PMIERs Minimum
Required
Assets (3)
Sep. 2019 - Dec. 2020
(4)
$
45,488,690
$
12,209,907
$
10,259,829
$
2,717,800
$
(609
)
$
(790
)
$
2,264
$
4,645
$
3,580
$
7,803
$
161,813
Jan. 2022 - Dec. 2022
20%
54,504,030
14,796,646
10,900,806
2,959,329
(469
)
1,255
1,879
3,784
3,101
8,445
218,858
Jan. 2023 - Dec. 2023
17.5%
39,137,562
10,840,618
6,849,073
1,897,108
1,020
2,461
1,349
2,715
3,852
8,163
143,367
Jan. 2024 - Dec. 2024
15%
20,388,139
5,620,923
3,058,221
843,138
159
159
407
508
1,035
1,252
58,872
Total
$
159,518,421
$
43,468,094
$
31,067,929
$
8,417,375
$
101
$
3,085
$
5,899
$
11,652
$
11,568
$
25,663
$
582,910
(1) Reinsurance provided by
unaffiliated special purpose insurers through the issuance of
mortgage insurance-linked notes ("ILNs").
(2) Reinsurance provided by panels
of reinsurers.
(3) Represents the reduction in
Essent Guaranty, Inc.'s Minimum Required Assets based on our
interpretation of the PMIERs.
(4) Reinsurance coverage on 40% of
eligible single premium policies and 20% of all other eligible
policies.
(5) Excludes ($45) and ($71) of
benefit in ceded premium on retired ILN's for the three and six
months ended June 30, 2024, respectively.
Exhibit J
Essent Group Ltd. and
Subsidiaries
Supplemental
Information
U.S. Mortgage Insurance
Portfolio Geographic Data
IIF by State
June 30, 2024
March 31, 2024
June 30, 2023
CA
12.7
%
12.9
%
13.1
%
FL
11.6
11.3
10.8
TX
10.8
10.6
10.5
CO
4.1
4.1
4.1
AZ
3.8
3.8
3.7
GA
3.6
3.5
3.3
WA
3.4
3.5
3.4
NC
3.0
2.9
2.8
IL
2.7
2.7
2.9
VA
2.7
2.7
2.9
All Others
41.6
42.0
42.5
Total
100.0
%
100.0
%
100.0
%
Gross RIF by State
June 30, 2024
March 31, 2024
June 30, 2023
CA
12.6
%
12.8
%
13.0
%
FL
11.8
11.6
11.1
TX
11.1
10.9
10.8
CO
4.1
4.1
4.1
AZ
3.8
3.8
3.8
GA
3.7
3.6
3.4
WA
3.4
3.4
3.4
NC
3.0
2.9
2.8
IL
2.6
2.7
2.8
VA
2.6
2.7
2.8
All Others
41.3
41.5
42.0
Total
100.0
%
100.0
%
100.0
%
Exhibit K
Essent Group Ltd. and
Subsidiaries
Supplemental
Information
Rollforward of Defaults and
Reserve for Losses and LAE
U.S. Mortgage Insurance
Portfolio
Rollforward of Insured Loans
in Default
Three Months Ended
2024
2023
June 30
March 31
December 31
September 30
June 30
Beginning default inventory
13,992
14,819
13,391
12,480
12,773
Plus: new defaults (A)
8,119
8,260
9,007
7,953
6,575
Less: cures
(7,956
)
(8,951
)
(7,418
)
(6,902
)
(6,761
)
Less: claims paid
(183
)
(123
)
(148
)
(129
)
(96
)
Less: rescissions and denials, net
(18
)
(13
)
(13
)
(11
)
(11
)
Ending default inventory
13,954
13,992
14,819
13,391
12,480
(A) New defaults remaining as of
June 30, 2024
5,944
2,466
1,922
1,204
699
Cure rate (1)
27
%
70
%
79
%
85
%
89
%
Total amount paid for claims (in
thousands)
$
5,566
$
3,605
$
3,411
$
2,956
$
1,890
Average amount paid per claim (in
thousands)
$
30
$
29
$
23
$
23
$
20
Severity
60
%
65
%
54
%
66
%
58
%
Rollforward of Reserve for
Losses and LAE
Three Months Ended
2024
2023
($ in
thousands)
June 30
March 31
December 31
September 30
June 30
Reserve for losses and LAE at beginning of
period
$
253,565
$
245,402
$
226,617
$
216,888
$
215,957
Less: Reinsurance recoverables
26,570
24,005
20,656
17,958
16,357
Net reserve for losses and LAE at
beginning of period
226,995
221,397
205,961
198,930
199,600
Add provision for losses and LAE occurring
in:
Current period
$
30,653
$
39,396
$
38,922
$
35,609
$
31,377
Prior years
(31,880
)
(30,062
)
(19,912
)
(25,533
)
(30,107
)
Incurred losses and LAE during the
period
(1,227
)
9,334
19,010
10,076
1,270
Deduct payments for losses and LAE
occurring in:
Current period
478
1
330
156
31
Prior years
5,205
3,735
3,244
2,889
1,909
Loss and LAE payments during the
period
5,683
3,736
3,574
3,045
1,940
Net reserve for losses and LAE at end of
period
220,085
226,995
221,397
205,961
198,930
Plus: Reinsurance recoverables
26,022
26,570
24,005
20,656
17,958
Reserve for losses and LAE at end of
period
$
246,107
$
253,565
$
245,402
$
226,617
$
216,888
(1) The cure rate is calculated by
dividing new defaults remaining as of the reporting date by the
original number of new defaults reported in the quarterly period
and subtracting that percentage from 100%.
Exhibit L
Essent Group Ltd. and
Subsidiaries
Supplemental
Information
Detail of Reserves by Default
Delinquency
U.S. Mortgage Insurance
Portfolio
June 30, 2024
Number of
Policies in
Default
Percentage of
Policies in
Default
Amount of Reserves
Percentage of Reserves
Defaulted RIF
Reserves as a Percentage
of
Defaulted RIF
($ in
thousands)
Missed Payments:
Three payments or less
7,024
50
%
$
43,396
19
%
$
525,876
8
%
Four to eleven payments
4,887
35
93,489
41
383,685
24
Twelve or more payments
1,908
14
82,529
37
135,616
61
Pending claims
135
1
7,562
3
8,540
89
Total case reserves
13,954
100
%
226,976
100
%
$
1,053,717
22
%
IBNR
17,023
LAE
2,108
Total reserves for losses and LAE
$
246,107
Average reserve per default:
Case
$
16.3
Total
$
17.6
Default Rate
1.71
%
December 31, 2023
Number of
Policies in
Default
Percentage of
Policies in
Default
Amount of Reserves
Percentage of Reserves
Defaulted RIF
Reserves as a Percentage
of
Defaulted RIF
($ in
thousands)
Missed Payments:
Three payments or less
7,288
49
%
$
44,607
20
%
$
527,419
8
%
Four to eleven payments
5,421
37
97,424
43
417,876
23
Twelve or more payments
1,984
13
78,540
35
132,257
59
Pending claims
126
1
5,550
2
6,302
88
Total case reserves
14,819
100
%
226,121
100
%
$
1,083,854
21
%
IBNR
16,959
LAE
2,322
Total reserves for losses and LAE
$
245,402
Average reserve per default:
Case
$
15.3
Total
$
16.6
Default Rate
1.80
%
June 30, 2023
Number of
Policies in
Default
Percentage of
Policies in
Default
Amount of Reserves
Percentage of Reserves
Defaulted RIF
Reserves as a Percentage
of
Defaulted RIF
($ in
thousands)
Missed Payments:
Three payments or less
5,581
45
%
$
33,864
17
%
$
388,012
9
%
Four to eleven payments
4,725
38
82,196
41
348,955
24
Twelve or more payments
2,045
16
78,236
39
123,903
63
Pending claims
129
1
5,680
3
6,687
85
Total case reserves
12,480
100
%
199,976
100
%
$
867,557
23
%
IBNR
14,998
LAE
1,914
Total reserves for losses and LAE
$
216,888
Average reserve per default:
Case
$
16.0
Total
$
17.4
Default Rate
1.52
%
Exhibit M
Essent Group Ltd. and
Subsidiaries
Supplemental
Information
Investments Available for
Sale
Investments Available for Sale
by Asset Class
Asset Class
June 30, 2024
December 31, 2023
($ in
thousands)
Fair Value
Percent
Fair Value
Percent
U.S. Treasury securities
$
999,176
18.3
%
$
996,382
18.9
%
U.S. agency securities
—
—
7,195
0.1
U.S. agency mortgage-backed securities
757,590
13.9
821,346
15.6
Municipal debt securities
524,396
9.7
547,258
10.5
Non-U.S. government securities
66,031
1.2
67,447
1.3
Corporate debt securities
1,151,976
21.1
1,297,055
24.7
Residential and commercial mortgage
securities
498,987
9.1
517,940
9.8
Asset-backed securities
455,453
8.3
564,995
10.7
Money market funds
1,001,374
18.4
444,121
8.4
Total investments available for sale
$
5,454,983
100.0
%
$
5,263,739
100.0
%
Investments Available for Sale
by Credit Rating
Rating (1)
June 30, 2024
December 31, 2023
($ in
thousands)
Fair Value
Percent
Fair Value
Percent
Aaa
$
2,409,458
54.1
%
$
2,561,363
53.2
%
Aa1
95,534
2.1
104,474
2.2
Aa2
265,098
6.0
291,501
6.0
Aa3
187,946
4.1
208,882
4.3
A1
352,488
7.9
377,188
7.8
A2
253,728
5.7
329,423
6.8
A3
252,599
5.7
253,081
5.3
Baa1
207,665
4.7
220,901
4.6
Baa2
199,072
4.5
226,449
4.7
Baa3
158,219
3.6
166,121
3.4
Below Baa3
71,802
1.6
80,235
1.7
Total (2)
$
4,453,609
100.0
%
$
4,819,618
100.0
%
(1) Based on ratings issued by
Moody's, if available. S&P or Fitch rating utilized if Moody's
not available.
(2) Excludes $1,001,374 and
$444,121 of money market funds at June 30, 2024 and December 31,
2023, respectively.
Investments Available for Sale
by Duration and Book Yield
Effective Duration
June 30, 2024
December 31, 2023
($ in
thousands)
Fair Value
Percent
Fair Value
Percent
< 1 Year
$
2,334,120
42.8
%
$
1,892,074
35.9
%
1 to < 2 Years
310,087
5.7
371,583
7.1
2 to < 3 Years
447,721
8.1
538,775
10.2
3 to < 4 Years
404,998
7.4
402,668
7.6
4 to < 5 Years
384,051
7.0
376,722
7.2
5 or more Years
1,574,006
29.0
1,681,917
32.0
Total investments available for sale
$
5,454,983
100.0
%
$
5,263,739
100.0
%
Pre-tax investment income yield:
Three months ended
3.84
%
Six months ended June 30, 2024
3.76
%
Holding company net cash and investments
available for sale:
($ in
thousands)
As of June 30, 2024
$
808,389
As of December 31, 2023
$
693,507
Exhibit N
Essent Group Ltd. and
Subsidiaries
Supplemental
Information
U.S. Mortgage Insurance
Company Capital
2024
2023
June 30
March 31
December 31
September 30
June 30
($ in
thousands)
U.S. Mortgage Insurance
Subsidiaries:
Combined statutory capital (1)
$
3,530,462
$
3,453,553
$
3,376,117
$
3,309,522
$
3,243,086
Combined net risk in force (2)
$
34,812,227
$
34,463,082
$
34,549,500
$
34,203,678
$
34,019,643
Risk-to-capital ratios: (3)
Essent Guaranty, Inc.
10.2:1
10.3:1
10.6:1
10.7:1
10.8:1
Essent Guaranty of PA, Inc.
0.3:1
0.4:1
0.4:1
0.5:1
0.5:1
Combined (4)
9.9:1
10.0:1
10.2:1
10.3:1
10.5:1
Essent Guaranty, Inc. PMIERs Data
(5):
Available Assets
$
3,513,609
$
3,464,119
$
3,379,936
$
3,318,179
$
3,245,481
Minimum Required Assets
2,052,135
1,999,928
1,985,545
1,910,659
1,991,741
PMIERs excess Available Assets
$
1,461,474
$
1,464,191
$
1,394,391
$
1,407,520
$
1,253,740
PMIERs sufficiency ratio (6)
171
%
173
%
170
%
174
%
163
%
Essent Reinsurance Ltd.:
Stockholder's equity (GAAP basis)
$
1,793,777
$
1,793,005
$
1,758,665
$
1,684,122
$
1,633,763
Net risk in force (2)
$
22,770,165
$
22,271,316
$
22,043,926
$
21,739,419
$
21,327,762
(1) Combined statutory capital
equals the sum of statutory capital of Essent Guaranty, Inc. plus
Essent Guaranty of PA, Inc., after eliminating the impact of
intercompany transactions. Statutory capital is computed based on
accounting practices prescribed or permitted by the Pennsylvania
Insurance Department and the National Association of Insurance
Commissioners Accounting Practices and Procedures Manual.
(2) Net risk in force represents
total risk in force, net of reinsurance ceded and net of exposures
on policies for which loss reserves have been established.
(3) The risk-to-capital ratio is
calculated as the ratio of net risk in force to statutory
capital.
(4) The combined risk-to-capital
ratio equals the sum of the net risk in force of Essent Guaranty,
Inc. and Essent Guaranty of PA, Inc. divided by the combined
statutory capital.
(5) Data is based on our
interpretation of the PMIERs as of the dates indicated.
(6) PMIERs sufficiency ratio is
calculated by dividing Available Assets by Minimum Required
Assets.
Exhibit O
Essent Group Ltd. and
Subsidiaries
Supplemental
Information
Ratios and Reconciliation of
Non-GAAP Financial Measures
2024
2023
June 30
March 31
December 31
September 30
June 30
Loss Ratio (1)
(0.1
)%
4.0
%
7.9
%
4.4
%
0.6
%
Expense Ratio (2)
26.1
%
27.1
%
27.0
%
27.3
%
19.8
%
Combined Ratio
26.0
%
31.1
%
34.9
%
31.7
%
20.4
%
Underwriting Margin (3)
74.0
%
68.9
%
65.1
%
68.3
%
79.6
%
We believe that loss, expense and combined
ratios are important measures of our financial performance. As a
result of the July 1, 2023 acquisition of Agents National Title and
Boston National Title (collectively "Title"), the consolidated
loss, expense and combined ratios ("Consolidated Ratios") for the
three and six months ended June 30, 2024 lack comparability with
periods prior to the acquisition. In order to provide investors
with more comparative information to prior periods, Essent has
prepared the table below to reconcile the Consolidated Ratios to
ratios excluding Title, as shown below. Ratios excluding Title are
financial measures that are not calculated under standards or rules
that comprise accounting principles generally accepted in the
United States (GAAP) and are referred to as non-GAAP measures.
Ratios excluding Title are measures used to monitor our results and
should not be viewed as a substitute for those measures determined
in accordance with GAAP.
The following table sets forth the
reconciliation of the loss, expense and combined ratios excluding
Title to the most comparable GAAP amount for the three and six
months ended June 30, 2024 in accordance with Regulation G:
Three Months Ended
June 30, 2024
Six Months Ended
June 30, 2024
Consolidated
Title
Excluding Title
Consolidated
Title
Excluding Title
($ in
thousands)
Revenues:
Net premiums earned
$
251,891
$
16,633
$
235,258
$
497,481
$
31,917
$
465,564
Net investment income
56,086
804
55,282
108,171
1,555
106,616
Realized investment losses, net
(1,164
)
—
(1,164
)
(2,304
)
—
(2,304
)
(Loss) income from other invested
assets
(419
)
—
(419
)
(2,334
)
—
(2,334
)
Settlement services (4)
1,412
1,412
—
2,837
2,837
—
Other income
5,136
474
4,662
7,448
881
6,567
Total revenues
312,942
19,323
293,619
611,299
37,190
574,109
Losses and expenses:
Provision (benefit) for losses and LAE
(334
)
892
(1,226
)
9,579
1,467
8,112
Other underwriting and operating expenses
(5)
55,987
12,909
43,078
113,336
24,719
88,617
Premiums retained by agents
10,215
10,215
—
19,706
19,706
—
Interest expense
7,849
—
7,849
15,711
—
15,711
Total losses and expenses
73,717
24,016
49,701
158,332
45,892
112,440
Loss ratio (1)
(0.1
%)
4.9
%
(0.5
%)
1.9
%
4.2
%
1.7
%
Expense ratio (2)
26.1
%
128.1
%
18.3
%
26.6
%
127.8
%
19.0
%
Combined ratio
26.0
%
133.0
%
17.8
%
28.5
%
132.0
%
20.7
%
Underwriting Margin (3)
74.0
%
(33.0
%)
82.2
%
71.5
%
(32.0
%)
79.3
%
(1) Loss ratio is calculated by
dividing the provision for losses and LAE by the sum of net
premiums earned and settlement services revenue, if applicable.
(2) Expense ratio is calculated by
dividing the sum of other underwriting and operating expenses and
premiums retained by agents by the sum of net premiums earned and
settlement services revenue, if applicable.
(3) Calculated as the inverse of
the combined ratio.
(4) Settlement services revenue is
included in "Other income" within Exhibit A and Exhibit C.
(5) Title expenses reflect only
direct expenses of Title operations and do not include corporate or
centralized support expense allocations.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240802385122/en/
Media Contact 610.230.0556 media@essentgroup.com
Investor Relations Contact Philip Stefano Vice President,
Investor Relations 855-809-ESNT ir@essentgroup.com
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