MTG - Earnings call transcript Q2 2018 | MGIC Investment Corporation

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Operator

Good day, ladies and gentlemen, and welcome to the MGIC Investment Corporation Second Quarter Earnings Call. At this time all participants are in a listen only mode. Later we will conduct a question and answer session and instruction will be given at that time. [Operator Instructions] As a reminder this call is being recorded. I would now like to turn the conference over to Mike Zimmerman, Senior Vice President Investor Relations. begin. may you Sir,

Mike Zimmerman

morning for you Investment your Good this Corporation. joining morning and interest and Ashely. for thank us Thanks in MGIC

be for Steve Sinks; our Chief Joining discuss Officer, participants Tim XXXX call includes that accessed the at earnings information on non-GAAP website, and which Chief Financial release of quarterly want located Chief Newsroom, this includes which the Risk will during to and results company’s all mtg.mgic.com Officer, are Pat the may me of I under second we refer Officer, additional morning, about today is certain Executive that the measures. Mattke; quarter our Mackey. on the results to remind financial to call

on pertaining website contains information force, our risk in we that presentation valuable. to find new will primary posted insurance and information a a think We written other our have you

call, expectations from Actual make During may comments of course contained in our those could this results these forward-looking about the statements. future. we differ the of materially

other call I’d at time on this that such the At to Additional those to fact any factors the those in earlier results update guidance like or of the from the morning. filed materially call subsequent that makes of about on company rely this the statements statements forward-looking statements, X-K not interested cause Further, any are undertaking could X-K. The turn developments. obligation the Form differ contained discussed are forward-looking should to light the are Pat. issuance this actual was we those in time that time, call current the parties no or information over of to than future in

Patrick Sinks

strong the billion of $XX as is was than of the our market returns expected higher helped contribute some few continue does, last key before and to lower business, to make the a on investment and and in result. market Mike, deliver stellar metric higher on rate along than year. is I’m at billion, revenue. let business morning. Tim higher full customer despite insurance provide a same are seen X% we XX%, billion since few force co-workers details greater a of to results progress year another approximately resulted In track commission had FHA you, year, but The income. purchase annual than of will a he Thank highlights. force financial has a refinance fewer the we gain share The of strong last share with the quarter, strategies. the the the excellent in increase quarter market, In on and minutes that hard profit market our primary we X% new in Total which purchase of my quarter to cover revenues, new fellow the was period for expanding report approximately overall to revenue as origination from that executing to ending pleased a mortgage primarily reinsurance the same we Since annual driver result in me it this $XXX.X and dedication company’s work the business $XX.X well XXXX. a we persistency the quarter insurance the focus service level good higher transactions, and not our to were in

our financial end to delinquent be The since as number has performance Turning of of for received of both to credit XXXX. be level the sequentially policies for its year-over-year. notes to new outstanding. quarter delinquent results. that a A Performance of continues to and fallen moment. percentage continues strong Further, the is declined credit a the lowest tailwind were

prior well Our lowest ratio expense from in return. to from last higher industry. net the be the premiums increase to cost NFA The due decreased the year than compensation ratio quarter higher continues an primarily in

know Tim, the the competitive had about of turn you many I environment within I over enquired Before it to industry.

premium months, few last all the VMIs their have into incorporating lenders Over introduced are and the workflow. into rates new them market

and growth our meaningful remain over While to have were With grow value there we was let returned to appears competition business like relevant they partner to the force, shareholders. customers be long-term change. that our earlier price absorb, insurance a current from before increase a tax level prudently in me rates creates flows year with to is conditions it priority can much Tim. what perspective, for and book our top long-term of it From generates premium our this in the which that turn

Timothy Mattke

Thanks, make and per to insight Pat. into results of earned operating and we financial income net disclosed $X.XX per better our measure. or To operating more quarter the we results $XXX.X In share or and $X.XX diluted compared the year-over-year $XXX.X share million net year. non-GAAP income same meaningful, period diluted last provide second to comparisons million adjusted in

to last commission $XX.X a more higher for year. into same million and to immaterial corporate go reserves in XXXX the primarily net reserves. losses release. plus income non-net I were adjusted higher the the including previously included were of operating only loss quarter, Premiums provision. due for about detail some of provision to the there performance second lower established and Losses period is consistent any quarter changes to financial There the compared impacts The a the our in period same rate lower press the in incurred profit established income of tax While tax due GAAP multiple income, Losses commission. drivers million on new last cost reconciliation higher incurred reflects for premiums quarter the investment moment. body year. of rate will tax improvement lower increased earned notices the earned delinquent to $XX.X negative of compared incurred

to review the delinquent should changes to As of made received any if quarter, determine previously we we do factors severity and each claim the rates what notices. inventory estimated be the performance of

of before developments the driven development our positive $XX for primary expected or months the $XX positive specifically to We by communities. loss continue on second positive of higher positive to compared of recognized in considering see performances development XX of loss We million inventory quarter developments rate, XXXX. reserves some final than The delinquent reserve impact primary was especially cure million of and longer. reinsurance

months We category. X improvement to in also XX saw the

reflects During XX% anticipated that approximately gears was same and the and we current economic environment of had in received over The these notices second which to last received quarter in compared the new year. fewer we notices on period claim the rate the XX% XXXX. quarter quarter the XX.X%,

new in received New accounted while accounting for of risk XX, approximately notice to in in the The books legacy the books June majority activity generate continue delinquent XX% of notices of the notices for XX% of the force quarter. the XXXX. new received legacy delinquent as

activity as from delinquent as New lower books economic well the the quite their larger condition. price written recently quality remains current reflecting high more

basis the in was The quarter for effective of the the from a new that expect coming the hurricanes. quarter Net the books Reflecting be for received closure which related XX.X the of X We from to the activity inventory of average legacy last moratoriums delinquent GSE the than million. smaller little quarters. will of period the The number XX% second same $XX year. last in premium notice was the XXXX claims impact points, second more and basis to stake were primary quarter. the yields claims points up declined quarter in continue source

this claims yield book, reported As volatility I've net positive the a have discussed it. pay Positive accruals, refunds of in a due delinquent resulted turn the in the the for some changes of primary loss policy of reserve losses, changes to yields losses earned. premium increase resulted the refund for to in decrease of of as This premium a loss premium accrual a development we and single due positive fewer decrease variety also to deals primarily due premium of quarter in reserve past, ceded in premium reasons quarter. decrease was to from development recognition expect in The the to resulted reported development can inventory. the which of reinsurers including ceded in we

our the with earned losses premiums net is ceded directly As line commission a the correlated through profit is reported incurred. reminder,

As increase. If XXXX. losses ceded attributable losses exclude from decrease we the the premium profit opposite commission QX increases of the of ceded and course the QX the of flat yield impacts of to all the development was about results, losses positive

take periods in continues while years. and the that expect premium I premium in there to volatility of from yield trend lower the old effect just rates off over mentioned, will as items impact will next the be new the the any given some the So we effective book several run future quarter

resulting paid changes totaled difficult any quarter increase expenses second and for primarily is the $X.X our quarter, expenses based million to assets. resulted end billion best PMIER's in assets MGIC's exact requirement. capital compensation, predict. Net to At $X.X year. excess higher a is the stock of to the was last purposes period compared available and excess billion price of in over $XXX the required given the compensation. which the in state approximately higher of the of $XX.X MGIC's However, same due XXXX The grants primarily second in amount nonexecutive a $XX.X million stock rate the in underwriting to other in million quarter were from

we in to company. quarter, As the $XX paid reported million a dividend the during the holding press MGIC release,

at on basis. expect this continue We to be least quarterly a the dividend level will paid of

a Additionally we at of weighted $XX.XX repurchased common price X.X share. shares stock average of million per

the as to amount excess and is writing to well our reinsurance we companies as we'll options to the capital our need of the of holding source they addition company. arise use pay writing we In analyze into writing the as to primary and company's take the reviewing continually dividends resources try new continuing by PMIER's exploring holding new various business to company. seek capital When deploy opportunities to on manage account

being not writing the MGIC. created and make we from So sure object dividends any does company the level, at payment notify while capital is OCI

billion We'll cash cash points of consider $X.X million the quarter in capital yield XX% holding also from in quarter, continue the securities, XX totaled leverage management and consolidated ratings of basis portfolio pretax unchanged last to including tax options. all consolidated had taxable X.X XX% investment the mix The a to evaluate duration which company At PMIERS. We trajectory, investment nearly of ability our X.XX%, company. holding of service of to last continue of is up ratio, years, a the quarter. our from and exempt $XXX debt investments a ability positive any and end course the changes and resulting

was debt the of capital approximately total second end Our quarter to the at XXXX. of ratio XX%

possible in to PMIERS interested Finally, or I X.X. changes are know many PMIERS of you

As third effective a in PMIERS to of have we reminder, from PMIERS. expect to in quarter December received proposed of will be XXXX over PMIERS and proposed finalized MGIC an expect we Required June at of of GSEs changes Assets the the a revised first summary XXXX. the draft received to In the changes XXXX, continue we XXXX, end quarter X.X, Assets. of Upon excess Available we effectiveness Minimum would of become the the

be the at than company and $XX our will materially pay think MGIC a in bound I of quarterly June able just XX, excess nondisclosure the then are do our Although provide be to finalized. plan XXXX, details dividend until would was quarterly are discussion they it not we to we to to rate. million continue lower by on fair with GSEs the updates Since and holding agreement,

back excess, to will changes return since is it should changes GAAP proposed think important by are contemplated being not our result materially in out point X.X. the regard changes Pat. I with With turn let impacted it me MGIC in we under expect PMIERS an having PMIERS, that any that Finally, be to to

Patrick Sinks

Tim. Thanks

what remain have company actions. taken such questions, to fronts. it of the actions role industry but give to quick very and continues to on regulatory be difficult the me and about that let housing moving timing can With may finance update a reform our regards to the gauge optimistic and political Before be we future the

company actively associations on engaged trade this and individual we As through including U.S. topic various in M.I. Washington. are

administrative XXXX. upon be or it While we this legislative not do they in likely be that think is possible either would forthcoming, that GSE reform acted proposals is may

topics. of We treating role the now the FHA, inclusive as discussions private of each separate are capital GSEs, as and the encouraged are versus about more them

Regarding the FHA specifically a recently new confirmed. been has Director

of gives During has FHA's the that flagship that this some interviews report, it unlikely is reduce its into health FHA's insight following most he FHA said stated the this confirmation which M.I. will insurance recent he actuary year. premiums fund.

roles fund are specifically unnecessary our on As system. Fannie pilot mandated the so insurance have why GSEs, By been been I are state. the mentioned loans industry and months that no and report the premiums period. impact There come at for new ratio. forecast other policies XX working had housing insured Freddie of to XX so that directly for customers their have written have that policymakers of introduced, FHA If could and our XXXX, change that discussing the will of with these during with uncertainty the versus to In company future likely M.I. XXXX issues be next M.I. created monitored is to much are FHA about our in do programs, considered closing, industry the private respect interest pilots With date the insurance the X% company. always we firm. any not has market NIW there lower successful, of materially indication the that for need the finance both believe been to would and X% cuts we company accounted to which X% future in the be our is he lower all and this would the programs over to in mortgage strategic disclaimers loan opportunity industry. perhaps an of

time. or to not of We happen we actively in have ourselves changes working them despite industry the may could the present but we and sometimes that are when about that may future, a MGIC market. and to now, that continue need I aware is in right on are housing to our impact book the issues remind expect of very confident exceptionally well performing opportunities ahead, some business That excited And that the that look value. shareholder is the generating significant and continue serve why I'm we to has for

to of a Our our insurance I GSE to $XXX.X of level credit the and those billion, force expect to generating mortgage insurance improve at persistency. book. persistency Further, claims there the and due more increased new new trend greater role force the notices, number opportunities. decline. the delinquency strong good for continue returns us in And operator, to continue to committed to questions. quarter write that credit and to let's inventory will trends that reducing business to in continue while continues than increased credit legacy that the play shareholders. expect delinquency X% and consumers I With is for continue paid, in on access favorably we providing to in grow we I will risk remain that, believe take pursuing for to anticipate

Operator

comes Instructions] from Partners. question Dunn Dowling Geoffrey [Operator our of first & And

Your line is open.

Geoffrey Dunn

number rate? the start up increase you accelerated maybe drivers the commenting the can what sequential of on premium the Tim, in cancellation by the was please. also And quarter for

Timothy Mattke

premium I'll Yes, question first. the, accelerated take guess, take the I I'll

for as in and million $X.X a quarter. not to pretty around close last were right well point. the driver just big but basis change where we quarter the and its quarter-over-quarter think I That yield was

point lumpiness NPL of as with far I as go As think we the certain beginning quarter-to-quarter then change really that you to the some that's look the seasonality I'd are what when think be on in to of of longer But deal, lumpy that as term and point it. cancellation, about what deals NPL from cancellation. seasonality really far so for

Geoffrey Dunn

were But in do was the the you if like here. how being the going are I’m draft eligible. about, BPMI, seems a CRT from initial confirm can magic Can part new then PMIERs traditional statement in to of maybe pilot? could regulated much but deals the And pilot MIs you can Pat, you not pilot eligible at talk be be affiliate not the you on any first that of blocked or of MIs on terms least it this or participate these like truly part sure there if

Patrick Sinks

Sure, to about, do, down. the options and to guess these happy FHA GSEs to risk back credit were I additional the what trying explore what private all step take transfer to credit which are sector, Geoff. to so the to are obviously your programs do

to MI We’re role private committed to the acronym BPMI, any as Corporation through said MGIC that’s eligible same so Mortgage post MIs these that for allow Insurance you elected in affiliates explore to regard well noted, important different the in identify the to pilot. that options subsidiary, we they had working finance, as this is with and or company the a already the traditional they ways of our housing MAC. would backdrop. participate In In case GSEs as traditional plays particular called

So get into can't of the it. we specifics

by terms to anything we’re We’re But confidentiality not the going that you agreement. is to of It's of breakout in But the sense keep tell in because us immaterial. it to prohibited just participate our on our the in financial transaction I can financials a market. enough. relatively allow finger not does the pulse in commitment it's big

you while that Freddie we and it's way to seek so think important it's level a field. by transactions in playing And still add important still small we Fannie also are that as developed we both a new participated

So one be other. material, to but level sorry, transparent playing transaction need didn't field. sure isn’t We material the is transactions again the advantage this that I’m the one over to necessary make to

process policy as best the execution for insurance mortgage the best for way but us believe to said again of So our for traditional the best allows our a homeowners watch to best is to going borrower the continue customers, participation kind we GSEs, housing what's the on. best and go, on is for That be small it relatively paid and inside whole. the that

execution fully the we borrower herein thought the on stick So water see to all channel our pay best committed the toe develops. these remain as but we

Geoffrey Dunn

And not the to to interested terms lending or that in your feedback in regard customers' round they're has question program? just with what out of whether been

Patrick Sinks

very we doesn’t we’re get hasn't anything it of execution. a a is still Mae kick participating Freddie It’s the feedback early. from and on that Fannie The imagine in traditional X, the muted. stage really move in program material away I while MI not it's still the in conversation private until mean August relatively They're program. terms

Operator

Mark question next comes from Our of DeVries Barclays.

line now is Your open.

Mark DeVries

returns capital about expect Have just forward. some what questions from should we going

indicated that liquidity guys think debt at hold now. your which company kind recently I like holding of about guess right Xx annualized of service at you the you cushion the to I you're

So should capital we to should of words something a of the million in kind your of capped range the writing your quarter? services dividends expect going kind returns your from that holding forward up company whatever out in company less $XX be the other debt that

Timothy Mattke

It's good Tim. it's Mark, question.

we interest per think capital just at over are said over about I cash like company, just that about to carries sitting million XXX you $XXX $XX times three holding in -- million year, multiple.

closer historical to one So times. three we of the three just to like it’s two times

as as look sort make the from company holding and we cash the to of feel market wouldn’t this we say to I that as that the represent get quarter last continue three it we sort market an of opportunity comfortable balance of implemented below authorization need times. take that obviously and the forward we'll we go as So just But opportunity standpoint. advantage what wouldn’t we well did us

Mark DeVries

of going $XX the the for holding And should Or to move if million we is to forward continue higher? be kind range? request up that company there dividend as room in expect you to still the

Patrick Sinks

with our we Mark, I always regulator have are think conversations OCI. the those

something about. have well them we'll $XX I have to get to and continue that comfortable about continue perform could very the higher And future. continue the a to to the think We results ability million whether feel conversation back. level go with as in it's discussion about we'll

Mark DeVries

then shareholders? when for might about And you your think the Okay. reestablishing dividend

Timothy Mattke

there. board an That’s one we've that about of with talked the other tools option our as

clearly of company. past the around and talked OCI for certainty the then and to Right think ability just that we that see ask out meaningful. dividend holding now in it to make about we've sort the to the the dividend it I the do flow

something that’s is about horizon on continue it's we'll the So there but to talk nothing on that.

Mark DeVries

made And then one of points the finally clarification just you one Timothy. about

quarter the we to expect we benefit premium to down. still where kind mean this the this got are drift related to You where that were average relative or nonrecurring relative we before and positive of you last to Do developments? quarter

Timothy Mattke

quarter even they you question. expect had the if because onetime to look It's that we IT That’s were happen first back But Again trend first are see some we quarter. in where where related a not this down from I’d good unpredictable. to any there. to they we but say period still can was they're items quarter items

Operator

next Our of question Micenko Jack comes from SIG.

Your open. line is

Unidentified Analyst

was first your Solomon quarter. this actually is ratio This My for question Jack this morning. on loss

in they with you had to the as last they at tracking of we benefit. at quarter million default have $XX But hurricane sort seems ratio were cure be quarter also coinciding year. have been look So data. since and And last levels I the the been that this highest the

we do think metric false somewhat getting the guys how ratio And past if you a in read any the today? be that that two loss paid quarters? of much for So part reported on of might

Patrick Sinks

that’s the activity we them because of from cure have look to for do. standpoint flowing hurricanes we and I at a the and out you reserve that’s control think definitely when what that’s

just I the think to we was about when that hurricane from think in a the we stated $XX amount on million. they short reserves we happen, of hurricanes talked for I standpoint it's ballpark. put still that

to determine when should standpoint. from reserve we a large on of believe in at the look the reserves items we related really data what what non-hurricane our looking statistics do and are we sort total, at And and we that so focused

Unidentified Analyst

you as the cure something don’t is not the a it for default number at core look core this quarter ratio So of lower? sort so that's

Mike Zimmerman

Zimmerman. is Mike This Sure.

and the started closer the lot if will returning game fourth to or flowing in put had right had They zones first so. ago number. year first through that growth as delinquent quarter we think down in in the activities to of indicated the I impact in the in quarter. better a a search out those clear less relative to around on markets, you core quarter. is to It's certainly We be gear supplement It's It units those to in the have started going come goods. same about X,XXX now areas. X,XXX

just it's closer core bit getting little to So a our number. we’re elevated but back

Unidentified Analyst

comfortable And trying just at one authorization it to on remain But year? entire of path used Just Little sense that in your to you be given capital the take continue up other was surprise to allocation. quarter see expiration these especially that in authorization the levels mean get one coming that purchase should quarters a to would announcement. being guys you despite we next cadence. the using this the upcoming the PMIERs the

Mike Zimmerman

holding What I how to exactly use advantage conditions we'll of the or standpoint a go over a take comfortable were the XXXX. decrease. tough the PMIERs about we’re through with think flow end feel We or The two predict going though very a market authorization as martial talked what does much the to have to even from it's company. quarter quarters. we next dividend still

thought authorization quarter. all the this in the things account much about we see repurchasing how we those So we under took last

Unidentified Analyst

competitive last that peers. weeks that guys quarter a quarter the And pricing Okay. you announced there the there rate lower on lastly in three then card you public were changes just had

does target anyway? saw $XX wondering in billion June your in change just benefit NIW of that volume outsize you if in we’re any So and

Patrick Sinks

This in is changed three Pat. all activity hasn’t our forecast not material. It mean billion. I of $XX week was

Operator

from next Credit Douglas of Harter Our comes question Suisse.

line is now Your open.

Douglas Harter

at that On peers card. more rate of the appears new rate your card granular some it a

June concern or of how the anything as you or seeing? this if end you July saw Just at you’re of of wondering does mix the any change in business

Stephen Mackey

This is Steve Mackey.

matched rate in So I went in expected noise see of our mix and We did was that competitors card we’re June. July. But concerned nothing some, new that into say our effect would about. the some that

Operator

Point. comes next Gamaitoni Compass from of Chris Our question

line Your now is open.

Chris Gamaitoni

And kind like of sense the -- flat few a level? your us the give declined outlook It's just of for it'll you recent roughly be is and delinquencies X.X. of looks from roughly I for quarters. been asset Can declining growth to being by in at I’m a think required roughly profitability strong flat levels growth. offset But sub required know trying from PMIERs about the kind step-down the assets. it a

on capital in think step PMIERs of going to I down excess just one the the for time it's build X.X? lot future for a

Patrick Sinks

I we we spot I decrease at assets, some parts growth the more is assets there versus the actual capital and The we think required as mean, continue the it Yes, by default have obviously look tailwinds to of obviously required is assets required in said. two the the to and inventory there some inventory.

book and grows, So continue that the in as down our But comes requirement grow we helps to and us. force we have associated that. with

lot a cash of It's you frankly really And standard its cash lot flows. that. growth -- see even construct, will as cause that said flow in the current I won't the -- more see to though returning the of I difference. a asset change don’t of So quite ultimately under earnings base it's a

way think about to excess think reset onetime the right the sort mind of with effective, when X.X grow could becomes in overtime. XXXX. Again which we of that believe so And keeping is how QX a of the I end

Chris Gamaitoni

get don’t buy And their about back capital about price opportunities shares the think of you how to there want assuming stock to see opportunities? step in you a available or returns at and that that how how down a kind is or stock build price -- the versus you construct you And minimum? just do level can we above think view the

Patrick Sinks

return at, business from we we the a to being critical standpoint look a about. think I think back Well, what obviously, to able component and deploy of that's

a to be And that to being have don’t recently think fully do on for some other control reinsurance PMIERs? because we over out we bring talk that about line. leverage. we the But we've think it of little excess dividend reinsurance about depends that the bit always waiting we down MGIC. flowing needs scale But able haven't talked to the We I been don’t of is the part more upon the do X.X. much what also back

So XX% I XX%, hidden we talked think we now. those about We've to want have to the hold. we're to mix parts of foreign all excessive excess there right obviously

there And With be comes of flexibility excess. X.X more so some that have some we around will there.

transfer look value those the look we -- we getting and to try business, at deploying from. risk alternative returns into best think that, We other into were other way and the will into at will credit as

Chris Gamaitoni

you pace like investing a us higher Okay. reinvesting And at asset you think future in sense outlook rates? given higher of of the the or and give investment growth kind can at of of income cash in rates where the moves periods

Patrick Sinks

think we a a little yield perspective quarter. an I increase saw of Yes, this from bit

don’t for our think move time. portfolio, one normally and things We look I chunks sort are like at of mature the part. to move big with that we most

that as So my it's something yield more that's as a will move, to expectation. slowly anything standpoint. dramatic really sort the on from you will see stimulate overtime from balance be overtime say happen standpoint continue both we I cash of would help and moves oppose yield to that really that going obviously, think as to sheet to position But, they see

Chris Gamaitoni

Okay.

is pace probably the of picking for just from you for you like specific HPA there Is Do now? its is are Next delinquencies Steve. think pre-vintage, question decline of the the it's looks pace new related seeing? up. It anything

Stephen Mackey

it's we're that related like but point sure look has Our does trying this under, something HPA. driven monitoring at to it by in is making interest probably we're get HPA that at

Operator

Philip from of next Deutsche Our Bank. comes question Stefano

Your open. line is

Philip Stefano

where valuation to Why I evaluation And feels sense or dial there think in and it of one it us there you’re don’t started of keep embedded I guidance give on where evaluation active you around more repurchases? last to, there that. you questions string bit of on Any get push the the you is I and was a start guess on can or the that? repurchases. a you rich make is the but guess, to thoughts and question back as

Patrick Sinks

Yeah.

as of value about it’s that we the is alternatives think give have versus we you company the look -- that prescriptive. It or we So, I at tough think to obviously cash for something think as early that and the tell a you what in thought anything versus other the consideration And that trade we company. right shares there go repurchase actions the when our as that the holding was well. this upon off about future I we will think the make I guess to quarter through based that can last to we

Philip Stefano

new Okay. states. and improved And that if or partially 'XX by was the driven mostly of it of in the that that hurricane heard moratorium the notices a the I it Is accelerated or feels driven second right? correctly quarter maybe in it like pace

Patrick Sinks

Are activity you talking notice collective talking about you're the about or the standpoint?

Philip Stefano

notice the activity. Correct, Yeah.

Mike Zimmerman

is Sequentially was provide got hurricane; This there that muted we’ve Mike. fewer very a impact I would say that basis there. on I mean, notices year-over-year

proceed. continue as or we’re extra around we So this of kind Pete to and that's trending hurricane X% XX% tell -- you to It and this step we year-over-year improvement intuition our monitor have going HPA but took a improvement did, related, in activity. better is year

Philip Stefano

mid the of in the notices But teens number year-over-year? was new down

Patrick Sinks

Yes.

Philip Stefano

Was or hurricane that in states? the moratorium to foreclosures related the

Patrick Sinks

wouldn’t affect the That activity. notice

Philip Stefano

it. Got

Understand. you. Okay. Thank

Patrick Sinks

Yeah.

but notice Foreclosures not paid that activity.

Philip Stefano

it. Got

you. Thank Okay.

Patrick Sinks

Sure.

Operator

Aron of comes Zelman. Our Mackenzie from next question

is line open. Your

Mackenzie Aron

from Two Thanks. me. questions Good morning.

this quarter’s rest of is rate tax year? run First, is good rate a for the

Patrick Sinks

just we’re think XX%. right I about

it to being the is of rate, think federal be way that right for the year. about we’re in tax the to think going that ballpark I rest new the

Mackenzie Aron

black company one updated pros and us Is and the picture. now big box for kind you that thoughts any down the Okay. of Pat, of then thinking market. more there that just is provide on how can you competitor about system cons And another the

on something Just any updated look that into? is to what thoughts

Patrick Sinks

up seems to MI to I you Well, who think know there one we is already companies out in think two direction where other going moving filing. it. at that on least market and be The I picked

need So, directionally can’t is comment customers to that’s we that. and think and with that we way our What box that to on pricing will are. timing their go continually the evolve demand black be there. always of fruition. I our come go if to we that we needs will And what prepare customers start will the

tool. and great we’ve monitoring Steve the market it and do does clearly a team also our the but conjunction customers. in it’s again so with love there management So capabilities, we'll closely risk his we’re as what

Operator

of of comes KBW. question next George from Our Bose

is line Your open.

Bose George

if X.X%. price down guys. the morning. noted would been release be price impact Hi by would In noted place the cuts given, you’ve that XQ, Good you the announced have the And guys you initially premiums you’d been in the press have when in cuts XX%.

So I guys that. difference would mean then about is really - made in curious pricing since I or the the be some of you your just adjustments

Mike Zimmerman

and entire for The average borrower we X.X the XX% on basis business. paid that skews the versus a Zimmerman. monthly of just mix Mike reported weighted refers is the This

those So two difference it's between numbers. a really good

Bose George

thanks. just little that. guess sense, in -- percentage down that down last makes the percentages with GSEs percentage XX over then go expect you that the DTI some the loans do quarter bit And the to that I made Is XX%. changes Okay, And to ticked a further.

Stephen Mackey

in do DTI now being down would that to the would it's I come Fannie anticipate This update little on percentage. period directly. that Steve. put pressure and that looking MIs I that We'll DU It’s XX that where pressure changes downward market is downward percentage. DTMI, to additional the continue also the a at pricing have priced on has bit. Mae believe the that put in is

And high. it believe it's to that closely. continue we're We monitoring very too

Bose George

Great. Thank for mean I you. Thanks And XX. that. did above

Operator

Our B. of comes Binner next question Randy Riley. from

Your line is open.

Randy Binner

Thanks. Good morning.

up few items. a Just clean

Could FHA expand market So think. something Pat in bit your mentioned gain to please? opening that I comments you with little share you has a share your upon do

Patrick Sinks

industry that are an are we -- indications FHA. winning our gradually gradually share are back Well, from as we the

$. in the to penetration to so XX XX% I think probably it think closer a it's rate it's was XX%. moving year evolved go if We or back you

more that regard to But and So it winning. that us in gradual. we we're is have available

Randy Binner

nothing potentially did as terms of But there being as as book. changed had and quality to you far credit the look their they

Patrick Sinks

seen at on mean in with I new comp. think the decisions, not commissioner those I now the We're all are No. the finally if anything. chair, No.

regard. nothing that So in far so

in just day-to-day win its know major no business, went that the You changes.

Randy Binner

writers And then regard to level. can got you comment MIs that And cards. mentioned in kind that pricing have conditions to have July returned to We is earlier a and that it of that can see black you But consistent pretax more published pricing think box also a see is a level? from that back you of of from that to comment what they're the cut level. for true what in pretax the think I kind rate doing is kind perspective

Patrick Sinks

more opening in. anything different it's it's kind We my just of much of in observed -- settled meaning haven't said expanded. kind pretty comments, as I It's that

Randy Binner

Yes.

is better investment equilibrium the in then the back want there just nature And investment income picked was portfolio. you sure or the up on yield to guess we're was bit So one just the make last nothing I little net meaningful, on there. more a to one-time unusual

Patrick Sinks

versus bit item we that income more one we line investment Nothing net onetime -- but mentioned be taxable that tax guys we the There's look to the nothing on and go for one means time there. pay get duties, a have in to a The little portfolio. we reposition overlaid probably which geography nature. we're have little benefit in line thing going forward more bit has earlier to some as

Randy Binner

Understood. Thanks a lot.

Patrick Sinks

Randy. Thanks

Operator

of comes from Mihir Our Bank of America Merrill next question Bhatia Lynch.

is line open. Your

Mihir Bhatia

on gaining quick real FHA on the share. follow-up comment market a just It's

given before is this cuts the to Now being. price

FHA expect that doesn’t comments least it you lower at lower the do obviously prices. private they seem MIs you that all initial have the prices? And likely indicated So as

accelerates? market think about how this that? thinking think want you that gain do Just So continuing share? to Do you you that will pace to guys see help with

Patrick Sinks

There margin. is opportunity on the us for

if be the moving but think couple last think in And attractive that's of a our it spells, at months would adjustments will. private the price you the don’t we execution on there think I of MI is certain in course margin. segments direction. shift the over became the certain I looked we when more major

Mihir Bhatia

just of I the if Is transactions little you'd then at, your you some active you've looked And that? risk. interested have been in? you was more market How competitors about Okay. layoff will think do the in be something curious -- that capital guys something

Patrick Sinks

Yes, look potential it's -- something continue and that overtime we'll execution we've there. at looked continue at to

traditional We in place. program have reinsurance

we the of so about And as potential think think think use. about I it, we the

is management. well And are positive putting you layoff think capital. it's what guess, close are as with risk look for a to industry management something or be to it's the various forms sort make could can guess, coexist like risks some as we in going existing, doing, traditional continue to I others that of the it more in notes I that our at two reinsurance what and want to sure as are through industry the I have it obviously but we'll potential both insurance capital markets people of,

keep an to continue on. we'll something that's So eye

Mihir Bhatia

side? for did there potential the do, lend imagine lend could GSEs And if up last with program the talk they Obviously, that alternative just do the in stuff. my products charter there to the it it. last about like seen year implications up some EPMI it. and Can you something is just then Got it on question, then we've you will borrow-up but the

around risk that? So rolled -- I that if some you about you What up you would how know of you was think that you just curious have anything? heard

Mike Zimmerman

programs base be Mike. do introduce, single interesting that market they the its to also relative signals. they lender It's I to borrower mean whether appear or

our similar it's the in operating monthly enrolling plans and that not and monthly looking programs Today have affirms be going product anything is about to We them obviously and at heard premium offer GSEs to the premiums about lenders inventory and collectively borrowers. for basis. conditions

CRT back borrower to traditional we the day that while So why monthly. stay one need things paid the pilot not as to we purchasing to to continuing bolster again sounds with in that the but only other close all programs are same

paid out programs. monthly agency we heard about So haven't borrower anything monthly rolling either is

Operator

in I'd call back remarks. questions further no at over to the for closing turn showing time. I'm like this queue any And

Patrick Sinks

company the call is I on This am participating Pat. Thank in and the for your just thanking interest by you. closed everybody today.

Operator

participating in the you This does conference. for today's thank and Ladies conclude gentlemen, program.

You great may day. all a disconnect. have Everyone

MGIC Investment (MTG) 18 Jul 182018 Q2 Earnings call transcript