NMI Holdings, Inc. Q1 FY2026 earnings call

• National MI delivered standout operating performance, continued growth in insured portfolio, and strong financial results in Q1. - Generated $12.3 billion of NIW volume and ended with $222.3 billion of primary insurance in force. - Total revenue was a record $183.5 million, adjusted net income $99.4 million, and adjusted return on equity 15.2%. - Macro environment and housing market resilient, lender customers and borrowers rely on them for down payment support. - High-quality insured portfolio with strong credit performance, consistent growth in insured book, and disciplined expense and capital management. - Encouraged by continued discipline in private MI market with rigorous underwriting standards and balanced pricing environment.

In the first quarter, National MI generated $12.3 billion of NIW volume and ended the period with a record $222.3 billion of high quality, high performing primary insurance in force. Total revenue was a record $183.5 million, adjusted net income was $99.4 million or $1.28 per diluted share, and adjusted return on equity was 15.2%. Net premiums earned in the first quarter were a record 154.8 million. Investment income was $28.6 million. Underwriting and operating expenses were $30.6 million with an expense ratio of 19.8%. Claims expense in the first quarter was 20.7 million. Shareholder's equity as of March 31st was $2.6 billion, book value per share was $34.57, and $198 million of repurchase capacity remained under the existing program.

• Macro risks remain, need to be proactive with pricing, risk selection, and reinsurance decisioning. - Labor market showing some signs of strain, consumer confidence down, conflict in Middle East adds new dimension. - Higher energy prices could impact consumers, but no notable impact expected on default activity or claims experience from this specifically.

Q: What was the default per new notice this quarter versus last quarter?

A: 14,200, broadly consistent with 14,500 last quarter.

Q: Delinquency rate in first quarter vs fourth quarter?

A: Broadly encouraged by credit performance, natural normalization in experience, seasonality and other factors at play.

Q: Loss severity trended up, anything to call out?

A: Law of small numbers, reflects growth and seasoning of book, small pool of claims.

Q: Impact of macro environment on quarter volume?

A: Confidence and interest rates play role, first quarter strong for purchase and refinancing, rates sell-off affected refinancing.

Q: Competition and NIW?

A: NIW up 33% year on year, competitive environment constructive, balance of year expected to be similar to 2025.

Q: Expenses pattern?

A: Modest increase in absolute dollars, disciplined about minimizing increases, invest in people, systems, etc.

Q: Credit losses, in-period losses up?

A: Combination of factors including default composition, mark-to-market LTV, larger loan sizes.

Q: NIW down quarter over quarter?

A: No significant market share moves, bulk transaction skew headline, MIW up 33% year on year in line with market growth.

Q: Profit commission trending lower?

A: Function of normalizing credit defaults