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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Essent Group Ltd | NYSE:ESNT | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.63 | 1.19% | 53.60 | 53.87 | 53.07 | 53.07 | 21,001 | 14:50:04 |
Essent Group Ltd. (NYSE: ESNT) today reported net income for the quarter ended March 31, 2021 of $135.6 million or $1.21 per diluted share, compared to $149.5 million or $1.52 per diluted share for the quarter ended March 31, 2020.
Essent also announced today that its Board of Directors has authorized a $250 million share repurchase plan to be executed by the end of 2022 and declared a quarterly cash dividend of $0.17 per common share. The dividend is payable on June 10, 2021, to shareholders of record on June 1, 2021.
"We are pleased with our financial results for the first quarter which we believe demonstrate a return to pre-COVID-19 profitability, as the U.S. economy gains momentum coming out of the pandemic and our defaults continue to normalize,” said Mark A. Casale, Chairman and Chief Executive Officer. “At quarter end, our capital position remains strong as our buy, manage and distribute operating model has our franchise well positioned. As a reflection of this, we are pleased to announce our $250 million share repurchase program and $0.01 per share increase in our quarterly dividend."
First Quarter 2021 Financial Highlights:
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 833-287-0797 inside the U.S., or 647-689-4456 for international callers, using passcode 4881985 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: 800-585-8367 inside the U.S., or 416-621-4642 for international callers, passcode 4881985.
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: the impact of COVID-19 and related economic conditions; 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; lenders or investors seeking alternatives to private mortgage insurance; an increase in the number of loans insured through Federal government mortgage insurance programs, including those offered by the Federal Housing Administration; decline in new insurance written and franchise value due to loss of a significant customer; decline in the volume of low down payment mortgage originations; the definition of "Qualified Mortgage" reducing the size of the mortgage origination market or creating incentives to use government mortgage insurance programs; the definition of "Qualified Residential Mortgage" reducing the number of low down payment loans or lenders and investors seeking alternatives to private mortgage insurance; the implementation of the Basel III Capital Accord discouraging the use of private mortgage insurance; a decrease in the length of time that insurance policies are in force; uncertainty of loss reserve estimates; deteriorating economic conditions; our non-U.S. operations becoming subject to U.S. Federal income taxation; becoming considered a passive foreign investment company for U.S. Federal income tax purposes; 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, 2020 filed with the Securities and Exchange Commission on February 26, 2021, 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”) which, through its wholly-owned subsidiary, Essent Guaranty, Inc., offers private mortgage insurance for single-family mortgage loans in the United States. Essent provides private capital to mitigate mortgage credit risk, allowing lenders to make additional mortgage financing available to prospective homeowners. Headquartered in Radnor, Pennsylvania, Essent Guaranty, Inc. is licensed to write mortgage insurance in all 50 states and the District of Columbia, and is approved by Fannie Mae and Freddie Mac. Essent also offers mortgage-related insurance, reinsurance and advisory services through its Bermuda-based subsidiary, Essent Reinsurance Ltd. Essent is committed to supporting environmental, social and governance ("ESG") initiatives that are relevant to the company and align with the companywide dedication to responsible corporate citizenship that positively impacts the community and people served. Additional information regarding Essent may be found at www.essentgroup.com and www.essent.us.
Source: Essent Group Ltd.
Essent Group Ltd. and Subsidiaries
Financial Results and Supplemental Information (Unaudited)
Quarter Ended March 31, 2021
Exhibit A
Condensed Consolidated Statements of Comprehensive Income (Unaudited)
Exhibit B
Condensed Consolidated Balance Sheets (Unaudited)
Exhibit C
Historical Quarterly Data
Exhibit D
New Insurance Written
Exhibit E
Insurance in Force and Risk in Force
Exhibit F
Other Risk in Force
Exhibit G
Portfolio Vintage Data
Exhibit H
Reinsurance Vintage Data
Exhibit I
Portfolio Geographic Data
Exhibit J
Rollforward of Defaults and Reserve for Losses and LAE
Exhibit K
Detail of Reserves by Default Delinquency
Exhibit L
Investments Available for Sale
Exhibit M
Insurance Company Capital
Exhibit A
Essent Group Ltd. and Subsidiaries
Condensed Consolidated Statements of Comprehensive Income (Unaudited)
Three Months Ended March 31,
(In thousands, except per share amounts)
2021
2020
Revenues:
Direct premiums written
$
235,257
$
205,980
Ceded premiums
(30,896)
(14,237)
Net premiums written
204,361
191,743
Decrease in unearned premiums
14,706
14,753
Net premiums earned
219,067
206,496
Net investment income
21,788
20,633
Realized investment gains, net
641
3,135
Other income (loss)
3,301
(1,424)
Total revenues
244,797
228,840
Losses and expenses:
Provision for losses and LAE
32,322
8,063
Other underwriting and operating expenses
42,239
41,947
Interest expense
2,051
2,132
Total losses and expenses
76,612
52,142
Income before income taxes
168,185
176,698
Income tax expense
32,537
27,175
Net income
$
135,648
$
149,523
Earnings per share:
Basic
$
1.21
$
1.53
Diluted
1.21
1.52
Weighted average shares outstanding:
Basic
112,016
97,949
Diluted
112,378
98,326
Net income
$
135,648
$
149,523
Other comprehensive income (loss):
Change in unrealized depreciation of investments
(59,203)
(10,074)
Total other comprehensive loss
(59,203)
(10,074)
Comprehensive income
$
76,445
$
139,449
Loss ratio
14.8
%
3.9
%
Expense ratio
19.3
20.3
Combined ratio
34.0
%
24.2
%
Exhibit B
Essent Group Ltd. and Subsidiaries
Condensed Consolidated Balance Sheets (Unaudited)
March 31,
December 31,
(In thousands, except per share amounts)
2021
2020
Assets
Investments
Fixed maturities available for sale, at fair value
$
4,252,144
$
3,838,513
Short-term investments available for sale, at fair value
449,332
726,860
Total investments available for sale
4,701,476
4,565,373
Other invested assets
100,393
88,904
Total investments
4,801,869
4,654,277
Cash
81,022
102,830
Accrued investment income
23,600
19,948
Accounts receivable
45,618
50,140
Deferred policy acquisition costs
14,723
17,005
Property and equipment
14,258
15,095
Prepaid federal income tax
302,636
302,636
Other assets
48,120
40,793
Total assets
$
5,331,846
$
5,202,724
Liabilities and Stockholders' Equity
Liabilities
Reserve for losses and LAE
$
411,123
$
374,941
Unearned premium reserve
235,730
250,436
Net deferred tax liability
318,622
305,109
Credit facility borrowings, net of deferred costs
322,018
321,720
Other accrued liabilities
123,416
87,885
Total liabilities
1,410,909
1,340,091
Commitments and contingencies
Stockholders' Equity
Common shares, $0.015 par value:
Authorized - 233,333; issued and outstanding - 112,847 shares in 2021 and 112,423 shares in 2020
1,693
1,686
Additional paid-in capital
1,571,134
1,571,163
Accumulated other comprehensive income
79,071
138,274
Retained earnings
2,269,039
2,151,510
Total stockholders' equity
3,920,937
3,862,633
Total liabilities and stockholders' equity
$
5,331,846
$
5,202,724
Return on average equity (1)
13.9
%
12.1
%
(1) The 2021 return on average equity is calculated by dividing annualized year-to-date 2021 net income by average equity. The 2020 return on average equity is calculated by dividing full year 2020 net income by average equity.
Exhibit C
Essent Group Ltd. and Subsidiaries
Supplemental Information
Historical Quarterly Data
2021
2020
Selected Income Statement Data
March 31
December 31
September 30
June 30
March 31
(In thousands, except per share amounts)
Revenues:
Net premiums earned:
U.S. Mortgage Insurance Portfolio
$
207,840
$
208,715
$
211,126
$
200,816
$
195,718
GSE and other risk share
11,227
13,624
11,132
10,655
10,778
Net premiums earned
219,067
222,339
222,258
211,471
206,496
Other revenues (1)
25,730
24,860
20,780
24,606
22,344
Total revenues
244,797
247,199
243,038
236,077
228,840
Losses and expenses:
Provision for losses and LAE
32,322
62,073
55,280
175,877
8,063
Other underwriting and operating expenses
42,239
36,825
37,100
38,819
41,947
Interest expense
2,051
2,149
2,227
2,566
2,132
Total losses and expenses
76,612
101,047
94,607
217,262
52,142
Income before income taxes
168,185
146,152
148,431
18,815
176,698
Income tax expense (2)
32,537
22,550
23,895
3,435
27,175
Net income
$
135,648
$
123,602
$
124,536
$
15,380
$
149,523
Earnings per share:
Basic
$
1.21
$
1.10
$
1.11
$
0.15
$
1.53
Diluted
1.21
1.10
1.11
0.15
1.52
Weighted average shares outstanding:
Basic
112,016
111,908
111,908
102,500
97,949
Diluted
112,378
112,310
112,134
102,605
98,326
Book value per share
$
34.75
$
34.36
$
33.33
$
32.23
$
31.51
Return on average equity (annualized)
13.9
%
13.0
%
13.5
%
1.8
%
19.6
%
Other Data:
Loss ratio (3)
14.8
%
27.9
%
24.9
%
83.2
%
3.9
%
Expense ratio (4)
19.3
16.6
16.7
18.4
20.3
Combined ratio
34.0
%
44.5
%
41.6
%
101.5
%
24.2
%
Credit Facility
Borrowings outstanding
$
325,000
$
325,000
$
425,000
$
425,000
$
425,000
Undrawn committed capacity
$
300,000
$
300,000
$
75,000
$
75,000
$
75,000
Weighted average interest rate (end of period)
2.13
%
2.19
%
1.90
%
1.93
%
2.87
%
Debt-to-capital
7.65
%
7.76
%
10.19
%
10.50
%
12.03
%
(1) Certain of our third-party reinsurance agreements contain an embedded derivative as the premium ceded under those agreements will vary based on changes in interest rates. For each of the three month periods noted, Other revenues include net favorable (unfavorable) changes in the fair value of these embedded derivatives as follows: March 31, 2021: ($606); December 31, 2020: ($209); September 30, 2020: ($677); June 30, 2020: $2,502; March 31, 2020: ($4,200).
(2) Income tax expense for the quarter ended March 31, 2021 includes $5,718 of discrete tax expense associated with an increase in the estimate of our beginning of the year deferred state income tax liability. Income tax expense for the three months ended March 31, 2020 was reduced by $620 of excess tax benefits associated with the vesting of common shares and common share units during each period.
(3) Loss ratio is calculated by dividing the provision for losses and LAE by net premiums earned.
(4) Expense ratio is calculated by dividing other underwriting and operating expenses by net premiums earned.
Exhibit C, continued
Essent Group Ltd. and Subsidiaries
Supplemental Information
Historical Quarterly Data
2021
2020
Other Data, continued:
March 31
December 31
September 30
June 30
March 31
($ in thousands)
U.S. Mortgage Insurance Portfolio
Flow:
New insurance written
$
19,254,014
$
29,566,820
$
36,664,583
$
28,163,212
$
13,549,299
New risk written
4,616,450
7,051,173
8,938,544
6,875,250
3,384,171
Bulk:
New insurance written
$
—
$
—
$
—
$
—
$
151
New risk written
—
—
—
—
24
Total:
New insurance written
$
19,254,014
$
29,566,820
$
36,664,583
$
28,163,212
$
13,549,450
New risk written
$
4,616,450
$
7,051,173
$
8,938,544
$
6,875,250
$
3,384,195
Average insurance in force
$
197,749,668
$
195,670,925
$
183,135,315
$
168,635,275
$
164,782,361
Insurance in force (end of period)
$
197,091,191
$
198,882,352
$
190,811,292
$
174,646,273
$
165,615,503
Gross risk in force (end of period) (5)
$
48,951,602
$
49,565,150
$
47,838,668
$
43,993,989
$
41,865,977
Risk in force (end of period)
$
41,135,978
$
41,339,262
$
41,219,216
$
39,113,879
$
38,290,022
Policies in force
785,382
799,893
781,836
733,651
706,714
Weighted average coverage (6)
24.8
%
24.9
%
25.1
%
25.2
%
25.3
%
Annual persistency
56.1
%
60.1
%
64.2
%
67.9
%
73.9
%
Loans in default (count)
29,080
31,469
35,464
38,068
5,841
Percentage of loans in default
3.70
%
3.93
%
4.54
%
5.19
%
0.83
%
U.S. Mortgage Insurance Portfolio premium rate:
Base average premium rate (7)
0.44
%
0.44
%
0.45
%
0.47
%
0.47
%
Single premium cancellations (8)
0.04
%
0.05
%
0.06
%
0.06
%
0.04
%
Gross average premium rate
0.48
%
0.49
%
0.51
%
0.53
%
0.51
%
Ceded premiums
(0.06
%)
(0.06
%)
(0.05
%)
(0.05
%)
(0.03
%)
Net average premium rate
0.42
%
0.43
%
0.46
%
0.48
%
0.48
%
(5) Gross risk in force includes risk ceded under third-party reinsurance.
(6) Weighted average coverage is calculated by dividing end of period gross risk in force by end of period insurance in force.
(7) Base average premium rate is calculated by dividing annualized base premiums earned by average insurance in force for the period.
(8) 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 D
Essent Group Ltd. and Subsidiaries
Supplemental Information
New Insurance Written: Flow
NIW by Credit Score
Three Months Ended
March 31, 2021
December 31, 2020
March 31, 2020
($ in thousands)
>=760
$
8,471,121
44.0
%
$
13,330,379
45.1
%
$
5,655,716
41.8
%
740-759
3,153,327
16.4
5,069,530
17.1
2,458,032
18.1
720-739
2,753,296
14.3
4,134,782
14.0
2,018,874
14.9
700-719
2,358,634
12.2
3,385,670
11.5
1,558,743
11.5
680-699
1,227,408
6.4
1,743,694
5.9
1,044,918
7.7
<=679
1,290,228
6.7
1,902,765
6.4
813,016
6.0
Total
$
19,254,014
100.0
%
$
29,566,820
100.0
%
$
13,549,299
100.0
%
Weighted average credit score
747
748
746
NIW by LTV
Three Months Ended
March 31, 2021
December 31, 2020
March 31, 2020
($ in thousands)
85.00% and below
$
3,968,576
20.6
%
$
6,317,550
21.4
%
$
1,963,476
14.5
%
85.01% to 90.00%
6,441,997
33.5
9,629,373
32.6
3,987,274
29.4
90.01% to 95.00%
7,052,522
36.6
11,134,923
37.6
5,685,880
42.0
95.01% and above
1,790,919
9.3
2,484,974
8.4
1,912,669
14.1
Total
$
19,254,014
100.0
%
$
29,566,820
100.0
%
$
13,549,299
100.0
%
Weighted average LTV
91
%
91
%
92
%
NIW by Product
Three Months Ended
March 31, 2021
December 31, 2020
March 31, 2020
Single Premium policies
6.9
%
7.7
%
9.7
%
Monthly Premium policies
93.1
92.3
90.3
100.0
%
100.0
%
100.0
%
NIW by Purchase vs. Refinance
Three Months Ended
March 31, 2021
December 31, 2020
March 31, 2020
Purchase
62.3
%
61.6
%
69.2
%
Refinance
37.7
38.4
30.8
100.0
%
100.0
%
100.0
%
Exhibit E
Essent Group Ltd. and Subsidiaries
Supplemental Information
Insurance in Force and Risk in Force
Portfolio by Credit Score
IIF by FICO score
March 31, 2021
December 31, 2020
March 31, 2020
($ in thousands)
>=760
$
81,629,166
41.4
%
$
82,452,139
41.5
%
$
68,385,363
41.3
%
740-759
33,969,375
17.2
34,538,761
17.3
28,289,661
17.1
720-739
29,323,182
14.9
29,599,646
14.9
24,441,834
14.7
700-719
23,775,892
12.1
23,807,982
12.0
19,442,133
11.7
680-699
15,241,886
7.7
15,538,235
7.8
13,859,727
8.4
<=679
13,151,690
6.7
12,945,589
6.5
11,196,785
6.8
Total
$
197,091,191
100.0
%
$
198,882,352
100.0
%
$
165,615,503
100.0
%
Weighted average credit score
745
745
745
Gross RIF by FICO score
March 31, 2021
December 31, 2020
March 31, 2020
($ in thousands)
>=760
$
20,063,586
41.0
%
$
20,336,799
41.0
%
$
17,138,596
40.9
%
740-759
8,512,926
17.4
8,682,265
17.5
7,181,181
17.2
720-739
7,410,503
15.1
7,504,065
15.1
6,262,376
15.0
700-719
5,947,590
12.1
5,970,851
12.1
4,950,746
11.8
680-699
3,798,221
7.8
3,887,059
7.9
3,537,973
8.4
<=679
3,218,776
6.6
3,184,111
6.4
2,795,105
6.7
Total
$
48,951,602
100.0
%
$
49,565,150
100.0
%
$
41,865,977
100.0
%
Portfolio by LTV
IIF by LTV
March 31, 2021
December 31, 2020
March 31, 2020
($ in thousands)
85.00% and below
$
28,285,671
14.4
%
$
27,308,296
13.7
%
$
17,304,231
10.5
%
85.01% to 90.00%
58,587,812
29.7
58,606,394
29.5
47,063,180
28.4
90.01% to 95.00%
84,042,974
42.6
86,169,485
43.3
77,059,950
46.5
95.01% and above
26,174,734
13.3
26,798,177
13.5
24,188,142
14.6
Total
$
197,091,191
100.0
%
$
198,882,352
100.0
%
$
165,615,503
100.0
%
Weighted average LTV
92
%
92
%
92
%
Gross RIF by LTV
March 31, 2021
December 31, 2020
March 31, 2020
($ in thousands)
85.00% and below
$
3,260,280
6.7
%
$
3,142,034
6.3
%
$
1,997,845
4.8
%
85.01% to 90.00%
14,061,301
28.7
14,061,553
28.4
11,322,131
27.0
90.01% to 95.00%
24,287,268
49.6
24,895,471
50.2
22,110,369
52.8
95.01% and above
7,342,753
15.0
7,466,092
15.1
6,435,632
15.4
Total
$
48,951,602
100.0
%
$
49,565,150
100.0
%
$
41,865,977
100.0
%
Portfolio by Loan Amortization Period
IIF by Loan Amortization Period
March 31, 2021
December 31, 2020
March 31, 2020
($ in thousands)
FRM 30 years and higher
$
186,190,300
94.5
%
$
187,704,000
94.4
%
$
156,741,714
94.6
%
FRM 20-25 years
4,354,432
2.2
4,365,585
2.2
2,829,876
1.7
FRM 15 years
4,763,796
2.4
4,776,068
2.4
3,230,148
2.0
ARM 5 years and higher
1,782,663
0.9
2,036,699
1.0
2,813,765
1.7
Total
$
197,091,191
100.0
%
$
198,882,352
100.0
%
$
165,615,503
100.0
%
Exhibit F
Essent Group Ltd. and Subsidiaries
Supplemental Information
Other Risk in Force
2021
2020
($ in thousands)
March 31
December 31
September 30
June 30
March 31
GSE and other risk share (1):
Risk in Force
$
1,534,174
$
1,416,719
$
1,216,353
$
1,031,699
$
1,100,966
Reserve for losses and LAE
$
1,312
$
1,073
$
718
$
28
$
16
Weighted average credit score
747
746
747
746
746
Weighted average LTV
84
%
84
%
84
%
85
%
85
%
(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 G
Essent Group Ltd. and Subsidiaries
Supplemental Information
Portfolio Vintage Data
March 31, 2021
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
$
5,129,571
8.5
%
30,610
4.29
%
82.8
%
69.9
%
4.5
%
14.2
%
43.1
%
3.3
%
1,715
5.60
%
2015
26,193,656
4,850,420
18.5
26,439
4.15
86.4
64.1
3.2
17.1
40.6
4.5
1,422
5.38
2016
34,949,319
9,643,407
27.6
48,920
3.85
87.3
63.7
8.3
14.9
44.1
6.2
2,760
5.64
2017
43,858,322
13,655,157
31.1
70,677
4.25
89.7
63.7
17.2
18.9
38.7
9.6
5,017
7.10
2018
47,508,525
15,685,099
33.0
77,094
4.76
93.3
66.1
22.1
19.5
34.9
16.0
6,106
7.92
2019
63,569,183
32,499,325
51.1
135,127
4.22
84.0
64.1
21.2
18.5
35.9
29.9
8,222
6.08
2020
107,944,065
96,534,141
89.4
335,081
3.21
60.9
50.5
10.9
11.7
43.9
23.5
3,819
1.14
2021 (through March 31)
19,254,014
19,094,071
99.2
61,434
2.87
62.3
46.0
9.3
13.1
43.9
2.4
19
0.03
Total
$
403,945,935
$
197,091,191
48.8
785,382
3.62
71.9
55.9
13.3
14.4
41.4
10.3
29,080
3.70
(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 H
Essent Group Ltd. and Subsidiaries
Supplemental Information
Reinsurance Vintage Data
March 31, 2021
($ in thousands)
Excess of Loss Reinsurance
Original Reinsurance in Force
Remaining Reinsurance in Force
Earned Premiums Ceded
Year
Remaining Insurance in Force
Remaining Risk in Force
ILN (1)
Other Reinsurance (2)
Total
ILN
Other Reinsurance
Total
Losses Ceded to Date
Original First Layer Retention
Remaining First Layer Retention
Year-to-Date
Reduction in PMIERs Minimum Required Assets (6)
2015 & 2016
$
13,987,747
$
3,777,142
$
333,844
$
—
$
333,844
$
216,480
$
—
$
216,480
$
—
$
208,111
$
207,588
$
1,212
$
48,644
2017
13,285,965
3,404,783
424,412
165,167
589,579
242,123
165,167
407,290
—
224,689
218,262
2,644
53,839
2018
15,328,438
3,897,423
473,184
118,650
591,834
325,537
76,144
401,681
—
253,643
250,350
3,186
98,593
2019 (3)
18,493,963
4,724,213
495,889
55,102
550,991
495,889
55,102
550,991
—
215,605
215,481
2,763
227,756
2019 & 2020 (4)
43,365,923
10,872,860
399,159
—
399,159
399,159
—
399,159
—
465,690
465,690
5,102
289,031
Total
$
104,462,036
$
26,676,421
$
2,126,488
$
338,919
$
2,465,407
$
1,679,188
$
296,413
$
1,975,601
$
—
$
1,367,738
$
1,357,371
$
14,907
$
717,863
Quota Share Reinsurance
Losses Ceded
Ceding Commission
Earned Premiums Ceded
Year
Remaining Insurance in Force
Remaining Risk in Force
Remaining Ceded Insurance in Force
Remaining Ceded Risk in Force
Year-to-Date
Year-to-Date
Year-to-Date
Reduction in PMIERs Minimum Required Assets (6)
2019 & 2020
(5)
$
109,753,017
$
26,943,264
$
24,013,881
$
5,840,023
$
5,869
$
5,060
$
15,989
$
389,362
(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) Reinsurance coverage on new insurance written from January 1, 2019 through August 31, 2019.
(4) Reinsurance coverage on new insurance written from September 1, 2019 through July 31, 2020.
(5) Reinsurance coverage on 40% of eligible single premium policies and 20% of all other eligible policies written from September 1, 2019 through December 31, 2020.
(6) Represents the reduction in Essent Guaranty, Inc.'s Minimum Required Assets based on our interpretation of the PMIERs.
Exhibit I
Essent Group Ltd. and Subsidiaries
Supplemental Information
Portfolio Geographic Data
IIF by State
March 31, 2021
December 31, 2020
March 31, 2020
CA
12.5
%
12.0
%
10.4
%
TX
9.8
9.7
8.9
FL
9.0
8.7
8.0
CO
4.1
4.1
3.8
WA
3.7
3.8
4.2
AZ
3.5
3.6
3.3
IL
3.4
3.4
3.6
NJ
3.2
3.3
3.6
VA
3.1
3.1
3.1
GA
3.0
3.0
3.1
All Others
44.7
45.3
48.0
Total
100.0
%
100.0
%
100.0
%
Gross RIF by State
March 31, 2021
December 31, 2020
March 31, 2020
CA
12.2
%
11.8
%
10.1
%
TX
10.1
10.0
9.2
FL
9.3
9.0
8.2
CO
4.0
4.1
3.7
WA
3.6
3.8
4.2
AZ
3.5
3.5
3.3
IL
3.3
3.3
3.5
NJ
3.1
3.2
3.5
GA
3.1
3.1
3.2
VA
3.0
3.1
3.1
All Others
44.8
45.1
48.0
Total
100.0
%
100.0
%
100.0
%
Exhibit J
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
2021
2020
March 31
December 31
September 30
June 30
March 31
Beginning default inventory
31,469
35,464
38,068
5,841
5,947
Plus: new defaults (A)
7,422
8,745
12,614
37,357
3,933
Less: cures
(9,737)
(12,679)
(15,135)
(4,983)
(3,914)
Less: claims paid
(61)
(49)
(67)
(144)
(118)
Less: rescissions and denials, net
(13)
(12)
(16)
(3)
(7)
Ending default inventory
29,080
31,469
35,464
38,068
5,841
(A) New defaults remaining as of March 31, 2021
5,775
4,640
5,009
11,450
764
Cure rate (1)
22
%
47
%
60
%
69
%
81
%
Total amount paid for claims (in thousands)
$
1,989
$
1,922
$
2,557
$
5,718
$
4,157
Average amount paid per claim (in thousands)
$
33
$
39
$
38
$
40
$
35
Severity
70
%
62
%
77
%
78
%
77
%
Rollforward of Reserve for Losses and LAE
Three Months Ended
2021
2020
($ in thousands)
March 31
December 31
September 30
June 30
March 31
Reserve for losses and LAE at beginning of period
$
373,868
$
307,019
$
250,862
$
73,325
$
69,183
Less: Reinsurance recoverables
19,061
11,898
7,761
98
71
Net reserve for losses and LAE at beginning of period
354,807
295,121
243,101
73,227
69,112
Add provision for losses and LAE occurring in:
Current period
47,763
63,597
55,660
181,776
15,419
Prior years
(15,680)
(1,879)
(1,070)
(5,911)
(7,193)
Incurred losses and LAE during the period
32,083
61,718
54,590
175,865
8,226
Deduct payments for losses and LAE occurring in:
Current period
114
524
205
288
1
Prior years
1,872
1,508
2,365
5,703
4,110
Loss and LAE payments during the period
1,986
2,032
2,570
5,991
4,111
Net reserve for losses and LAE at end of period
384,904
354,807
295,121
243,101
73,227
Plus: Reinsurance recoverables
24,907
19,061
11,898
7,761
98
Reserve for losses and LAE at end of period
$
409,811
$
373,868
$
307,019
$
250,862
$
73,325
(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 K
Essent Group Ltd. and Subsidiaries
Supplemental Information
Detail of Reserves by Default Delinquency
U.S. Mortgage Insurance Portfolio
March 31, 2021
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
5,487
19
%
$
39,244
10
%
$
329,223
12
%
Four to eleven payments
16,157
56
215,949
57
1,022,979
21
Twelve or more payments
7,393
25
120,128
32
500,658
24
Pending claims
43
—
1,758
1
2,236
79
Total case reserves
29,080
100
%
377,079
100
%
$
1,855,096
20
IBNR
28,281
LAE
4,451
Total reserves for losses and LAE
$
409,811
Average reserve per default:
Case
$
13.0
Total
$
14.1
Default Rate
3.70%
December 31, 2020
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
6,631
21
%
$
47,905
14
%
$
384,668
12
%
Four to eleven payments
23,543
75
260,593
76
1,553,593
17
Twelve or more payments
1,243
4
32,593
9
67,501
48
Pending claims
52
—
2,199
1
2,843
77
Total case reserves
31,469
100
%
343,290
100
%
$
2,008,605
17
IBNR
25,747
LAE
4,831
Total reserves for losses and LAE
$
373,868
Average reserve per default:
Case
$
10.9
Total
$
11.9
Default Rate
3.93%
March 31, 2020
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
3,043
52
%
$
15,128
23
%
$
170,374
9
%
Four to eleven payments
2,140
37
30,493
45
114,135
27
Twelve or more payments
518
9
15,235
23
29,596
51
Pending claims
140
2
6,241
9
7,074
88
Total case reserves
5,841
100
%
67,097
100
%
$
321,179
21
IBNR
5,032
LAE
1,196
Total reserves for losses and LAE
$
73,325
Average reserve per default:
Case
$
11.5
Total
$
12.6
Default Rate
0.83%
Exhibit L
Essent Group Ltd. and Subsidiaries
Supplemental Information
Investments Available for Sale
Investments Available for Sale by Asset Class
Asset Class
March 31, 2021
December 31, 2020
($ in thousands)
Fair Value
Percent
Fair Value
Percent
U.S. Treasury securities
$
262,309
5.6
%
$
268,444
5.9
%
U.S. agency securities
16,138
0.3
18,085
0.4
U.S. agency mortgage-backed securities
1,022,991
21.7
995,905
21.8
Municipal debt securities
572,263
12.2
551,517
12.1
Non-U.S. government securities
79,280
1.7
61,607
1.3
Corporate debt securities
1,414,938
30.1
1,126,512
24.7
Residential and commercial mortgage securities
446,208
9.5
409,282
9.0
Asset-backed securities
473,804
10.1
454,717
9.9
Money market funds
413,545
8.8
679,304
14.9
Total investments available for sale
$
4,701,476
100.0
%
$
4,565,373
100.0
%
Investments Available for Sale by Credit Rating
Rating (1)
March 31, 2021
December 31, 2020
($ in thousands)
Fair Value
Percent
Fair Value
Percent
Aaa
$
2,310,267
49.1
%
$
2,564,746
56.2
%
Aa1
138,510
3.0
133,100
2.9
Aa2
288,583
6.1
260,462
5.7
Aa3
217,683
4.6
204,917
4.5
A1
266,937
5.7
249,710
5.5
A2
426,285
9.1
401,175
8.8
A3
278,424
5.9
229,882
5.0
Baa1
296,627
6.3
260,602
5.7
Baa2
274,367
5.8
178,926
3.9
Baa3
140,688
3.0
48,199
1.1
Below Baa3
63,105
1.4
33,654
0.7
Total investments available for sale
$
4,701,476
100.0
%
$
4,565,373
100.0
%
(1) Based on ratings issued by Moody's, if available. S&P or Fitch rating utilized if Moody's not available.
Investments Available for Sale by Duration and Book Yield
Effective Duration
March 31, 2021
December 31, 2020
($ in thousands)
Fair Value
Percent
Fair Value
Percent
< 1 Year
$
1,158,371
24.6
%
$
1,568,505
34.4
%
1 to < 2 Years
443,897
9.4
581,003
12.7
2 to < 3 Years
708,723
15.1
616,069
13.5
3 to < 4 Years
473,707
10.1
426,333
9.3
4 to < 5 Years
511,955
10.9
367,633
8.1
5 or more Years
1,404,823
29.9
1,005,830
22.0
Total investments available for sale
$
4,701,476
100.0
%
$
4,565,373
100.0
%
Pre-tax investment income yield:
Three months ended March 31, 2021
2.02
%
Net cash and investments at holding company, Essent Group Ltd.:
($ in thousands)
As of March 31, 2021
$
540,330
As of December 31, 2020
$
562,714
Exhibit M
Essent Group Ltd. and Subsidiaries
Supplemental Information
Insurance Company Capital
2021
2020
March 31
December 31
September 30
June 30
March 31
($ in thousands)
U.S. Mortgage Insurance Subsidiaries:
Combined statutory capital (1)
$
2,778,131
$
2,659,161
$
2,581,136
$
2,457,368
$
2,452,730
Combined net risk in force (2)
$
29,358,191
$
29,493,572
$
29,821,246
$
28,787,600
$
28,729,105
Risk-to-capital ratios: (3)
Essent Guaranty, Inc.
11.0:1
11.5:1
12.0:1
12.1:1
12.1:1
Essent Guaranty of PA, Inc.
1.4:1
1.7:1
2.0:1
2.3:1
2.7:1
Combined (4)
10.6:1
11.1:1
11.6:1
11.7:1
11.7:1
Essent Guaranty, Inc. PMIERs Data (5):
Available Assets
$
2,996,651
$
2,855,923
$
2,720,432
$
2,586,394
$
2,453,705
Minimum Required Assets
1,864,262
1,671,011
1,739,479
1,458,273
1,226,824
PMIERs excess Available Assets
$
1,132,389
$
1,184,912
$
980,953
$
1,128,121
$
1,226,881
PMIERs sufficiency ratio (6)
161
%
171
%
156
%
177
%
200
%
Essent Reinsurance Ltd.:
Stockholder's equity (GAAP basis)
$
1,136,504
$
1,101,003
$
1,061,546
$
1,022,689
$
1,005,038
Net risk in force (2)
$
12,905,289
$
12,892,300
$
12,312,124
$
11,113,079
$
10,589,736
(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.
View source version on businesswire.com: https://www.businesswire.com/news/home/20210507005093/en/
Media Contact 610.230.0556 media@essentgroup.com Investor Relations Contact Christopher G. Curran Senior Vice President – Investor Relations 855-809-ESNT ir@essentgroup.com
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