NMI Holdings Inc

Good day and thank you for standing by. Welcome to the NMI Holdings Incorporated Second Quarter 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask the question during the session, you will need to press star 1 on your telephone. If you require any further assistance, press star 0. I would now like to hand the conference over to your speaker today. Mr. John Swenson, please go ahead.

Thank you. Good afternoon and welcome to the 2021 second 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 Schuster, Executive Chairman, Claudia Merkel, CEO, Adam Pulitzer, our Chief Financial Officer, and Julie Norberg, our Comptroller. Financial results for the quarter were released after the close today. The press release may be accessed on NMI'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. I'm pleased to report that in the second quarter, National MI delivered strong operating performance, significant growth in our insured portfolio, and record financial results. As we talk today, I remain highly encouraged. The economic stress of the COVID pandemic continues to recede, and the housing market continues to lead with resiliency and foundational strength. Against this backdrop, we achieved record adjusted net income of 58.1 million, or 67 cents per diluted share, and GAAP net income of $57.5 million, or $0.65 per diluted share. Adjusted return on equity for the quarter was 16.4 percent, and GAAP ROE was 16.2 percent. We ended the second quarter with a record $136.6 billion of high-quality primary insurance and force. We are helping more borrowers than ever before gain access to housing, and the growth in our insured portfolio reflects this strength, up 10 percent compared to the first quarter of this year and 38 percent compared to the second quarter of 2020. Credit performance in our in-force portfolio also continues to trend in a favorable direction, and we are increasingly optimistic as we look forward given the quality of our underlying book, sustained resiliency of the housing market, and strengthening macro environment. Shifting to Washington matters, we would like to congratulate Sandra Thompson on her appointment as acting director of the FHFA. Director Thompson is a highly experienced regulator with deep knowledge and expertise. We expect she will further the Biden administration's efforts to expand access and equitable opportunities for homeownership to all communities while maintaining an overarching focus on preserving the safety and soundness of the housing finance system. We believe there is broad recognition in Washington of the value that National MI and the broader private mortgage insurance industry bring to these efforts. providing borrowers with down payment support and equal access to mortgage credit, while also placing private capital in front of the taxpayer to absorb risk and loss in a downturn. And we look forward to engaging with Director Thompson and the broader FHFA leadership team in the months ahead. We also note and applaud the continued effort by those in Washington to assist borrowers who are still impacted by the COVID crisis. The recent Housing Stability Action Plan outlined by the White House, foreclosure process changes adopted by the CFPB and the FHFA, an enhanced set of loan modification and payment reduction options introduced by HUD, the USDA, and VA are important additional steps in this regard. The recovery from the pandemic, while broad-based, will not be even. And as the immediacy of the crisis recedes, there will still be many in need of support. We believe policymakers and regulators are committed to providing additional assistance to help as many borrowers as possible remain in their homes and resume their lives with limited interruption once the pandemic has passed. Overall, we had a terrific quarter and are well positioned to continue helping borrowers and delivering on the goals that we set for our business. With that, let me turn it over to Claudia.