NMI Holdings Inc

Good morning, ladies and gentlemen, and welcome to the NMI Holdings Inc. 3rd Quarter 2020 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session, and instructions will follow at that time. If anyone should require assistance during the conference, please press star, then zero on your touchtone telephone. I would now like to turn the conference over to your host, Mr. John Swenson. Please go ahead, sir.

Thank you, Leah. Good afternoon and welcome to the 2020 third quarter conference call for National MI. I'm John Swenson, Vice President of Investor Relations and Treasury. Joining us on the call today are Brad Shuster, Executive Chairman, Claudia Merkel, CEO, Adam Pollitzer, our Chief Financial Officer, and Julie Norberg, our Controller. Financial results for the quarter were released after the close today. The press release may be accessed on MI's website located at nationalmi.com under the Investors tab. During the course of this call, we may make comments about our expectations for the future. Actual results could differ materially from those contained in these forward-looking statements. Additional information about the factors that could cause actual results or trends to differ materially from those discussed on the call can be found on our website or through our regulatory filings with the SEC. If and to the extent the company makes forward-looking statements, we do not undertake any obligation to update those statements in the future in light of subsequent developments. Further, no one should rely on the fact that the guidance of such statements is current at any time other than the time of this call. Also note that on this call, we refer to certain non-GAAP measures. In today's press release and on our website, we provided a reconciliation of these measures to the most comparable measures under GAAP. Now I'll turn the call over to Brad.

Thank you, John, and good afternoon, everyone. On today's call, we'll review our third quarter results and share an update on how COVID is impacting our business performance and financial position, as well as the broader housing and mortgage insurance markets. We are now eight months into this pandemic, and while public health and economic concerns persist, We continue to see broad strength and resiliency in the housing market, and we see the same strength and resiliency mirrored in our performance at National MI. We reported strong results for the third quarter, delivering a record $18.5 billion of NIW and $104.5 billion of primary insurance and force, notably our first quarter in excess of $100 billion. and broadly resilient earnings that traced the success of our comprehensive credit risk management framework. We built National MI to be a credible and sustainable counterparty through all market cycles. From day one, we focused on building a durable franchise in a risk responsible manner. We have worked hard to establish a comprehensive credit risk management framework and in doing so, We have built the highest quality insured portfolio in the mortgage insurance industry. Well before the pandemic emerged, we were using individual risk underwriting and rate GPS pricing to target a higher quality mix of business and had secured comprehensive reinsurance protection for our enforced portfolio. Alongside our credit risk management efforts, we built a strong balance sheet foundation. We have been conservative in our investment portfolio and worked hard to build a robust liquidity position. We have flexible access to a broad range of capital and reinsurance markets and a significant regulatory funding cushion. Our broadly conservative stance heading into this period and the continued success we've achieved in the capital and reinsurance markets, most recently with our fifth ILM closing last week, positions us to fully support our lenders and their borrowers through the duration of the COVID pandemic. We're succeeding and building value every day for our employees, for our customers, and for our shareholders and other key stakeholders. The new business environment is exceptionally strong, with record mortgage originations driving NIW volume and equally constructive pricing and risk dynamics driving value. Alongside this, credit performance in our in-force portfolio is trending in an encouraging direction. Overall, we see real strength in the housing market. Demand is robust, house prices continue to rise, and record low interest rates are giving more Americans a chance to access homeownership. at a time when it's most critical. Policy efforts are also playing an important and stabilizing role. We fully endorse the various forbearance, foreclosure moratorium and other assistance programs designed to help bridge borrowers past this point of acute stress and ensure that they are able to remain in their homes and resume their lives with limited interruption once the pandemic has passed. Homeownership is essential, more so today than ever before. People need shelter in order to shelter in place. And allowing borrowers who through no fault of their own are facing real strain to stay in their homes and avoid foreclosure is the right social policy. It will also help speed the ultimate pace of economic recovery. We encourage policymakers to maintain their focus and offered continued support as needed to carry homeowners through this period. With that, let me turn it over to Claudia.