8/5/2021

speaker
Operator

today's conference is scheduled to begin shortly please continue to stand by thank you for your patience today's conference is scheduled to begin shortly please continue to stand by thank you for your patience Thank you. Good day and thank you for standing by. Welcome to MGIC Investment Corporation second quarter 2021 earnings call. At this time, all participants line are in the listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 on your telephone. Please be advised that today's conference is being recorded. If you require any further assistance, please press star 0. I would now like to hand the call over to your speaker today, Mr. Mike Zimmerman, Senior Vice President, Investor Relations. Please go ahead.

speaker
Mike Zimmerman

Thanks, Elena. Good morning, and thank you for joining us this morning and for your interest in MGIC Investment Corporation. Joining me on the call today to discuss the results for the second quarter of 2021 are Chief Executive Officer Tim Matkey and Chief Financial Officer Nathan Coulson. I want to remind all participants that our earnings release of last evening, which may be accessed on MGIC's website, which is located at mtg.mgic.com under newsroom, includes additional information about the company's quarterly results that we'll refer to during the call, and includes a reconciliation of non-GAAP financial measures to the most comparable GAAP measures. We've also posted on our website a presentation that contains information pertaining to our primary risk and force, new insurance written, reinsurance transactions, and other information which we think you will find valuable. I also want to remind listeners that from time to time we may post information about our underwriting guidelines and other presentations or corrections to past presentations on our website that investors and other interested parties would find valuable as well. During the course of this call, we may make comments about our expectations of the future. Actual results could differ materially from those contained in these forward-looking statements. Additional information about those factors, including COVID-19, that could cause actual results to differ materially from those discussed in the call, are contained in the Form 8K and Form 10Q that were filed last night. If the company makes any forward-looking statements, we're not undertaking an obligation to update those statements in the future in light of subsequent developments. Further, no interested party should rely on the fact that such guidance or forward-looking statements are current. at any time other than the time of this call or the issuance of the Form 8-K or Form 10-Q. With that, I'd like to turn the call over to Tim Mackey.

speaker
Tim Matkey

Tim Mackey Thanks, Mike. Good morning, everyone. I'm pleased to report that we produced another quarter of very strong financial results. After my opening remarks, Nathan will provide more detail about our financial results and capital position. Then, before we open up the line for questions, I'll wrap up by discussing the current operating environment, including activities related to finance housing policy. During the quarter, we earned GAAP net income of $153.1 million. Our quarterly financial results reflect the solid credit quality of our insurance in force, a strong housing market, a decreasing delinquency rate, and improving economic conditions as many local economies return to pre-pandemic levels of activity. We had another busy quarter as we wrote a record $33.6 billion of new business, which more than offset the pressure of lower annual persistency on our existing book of business and resulted in our insurance and force growing to $262 billion, nearly 14% higher than the same period last year. An increasing percentage of our new insurance written is from purchase transactions, accounting for 79% of our NIW in the second quarter compared to 60% last quarter. Our application pipeline, a leading indicator of NIW, indicates this trend has continued with purchase transactions continuing to account for more than 85% of applications received in recent months. While NIW in the first half of the year was strong, we expect that NIW will slow in the second half of the year, primarily due to the reduction of refinance activity. While the current supply of housing inventory available for purchase remains low, we still expect robust purchase market conditions to persist. Consumer demand, for many reasons, remains strong, and interest rates are attractive, especially by historical standards. Home prices have been increasing rapidly given the low housing inventory and the strong demand. We believe that home prices may be increasing for more sound reasons than in the 2005-2007 cycle. So while we do not expect broad declines in home prices, we do expect that the rate of increase will slow. These conditions, along with increasing annual persistency, should allow our insurance and force to continue to grow. although perhaps at a slower annual rate than we have been enjoying in recent quarters. Taking a look at our insurance and force portfolio, our loss ratio was a low 11.6% in the quarter. This result primarily reflects improving economic conditions, the quality of our existing book of business, and the low number of new delinquency notices received. I continue to be encouraged by the positive trends we are seeing in credit performance, which continue through July. At quarter end, we maintained a $2.3 billion excess over PMIR's minimum required assets, and our PMIR sufficiency ratio was 167% at the end of the second quarter. Reflecting our capital position and long-term confidence in our transformed business model, a $150 million dividend from MGIC to our holding company was declared and paid after the end of the second quarter, and the holding company board authorized a 33% increase in the quarterly common stock dividends. Our capital management strategy centers on maintaining financial flexibility at both the holding company and the writing company to protect our policyholders and to create long-term value for shareholders. This value can be created by writing more primary mortgage insurance, pursuing new business opportunities, retiring debt, paying dividends, or repurchasing stock. In summary, we continually look for ways to maximize near-term business opportunities while remaining focused on the long-term success of the company. I believe the actions we have taken prior to and during the COVID pandemic support the statement. We have a strong and dynamic balance sheet. We are confident in our positioning in this market, and we like the risk-reward equation that the current conditions offer. With that, let me turn it over to Nathan.

speaker
Tim Mackey

Thanks, Tim, and good morning. As Tim mentioned, we had another strong quarter of financial results. In the second quarter, we earned $153 million in net income for 44 cents per diluted share, and generated an annualized 13% return on beginning shareholders' equity. This compares to $14 million of net income, or 4 cents per diluted share, in the same period last year. Of course, the second quarter of last year was impacted by the material increase in delinquencies related to COVID-19 and the associated increase in net losses incurred. During the quarter, total revenues were $298 million compared to $294 million last year, with the increase primarily due to higher net premiums earned. The main driver of the increase in net premiums earned was the higher profit commission earned through our quarter share reinsurance transactions in the current quarter compared to the second quarter of last year, mainly due to the lower level of losses seeded in the current period compared to last year. The net premium yield for the second quarter was 39.1 basis points, which was down 1.8 basis points compared to last quarter. The decrease was primarily a result in the decline in in-force premium yield with the runoff through attrition of the older policies which generally have higher premium rates. As refinance activity decreased, we also realized less benefit from accelerated premiums earned from single premium policy cancellations. During the quarter, they totaled $20 million compared to $28 million last quarter and $33 million in the second quarter of 2020. Shifting over to credit, Net losses incurred were $29 million in the second quarter compared to $217 million in the same period last year and $40 million last quarter. In the second quarter, we received approximately 9,000 new delinquency notices, which represents less than 1% of the number of loans insured as of the start of the quarter and is 30% less than the number of notices received last quarter. We are encouraged by the credit trends we are experiencing, including the low level of early payment defaults, and believe they are good indicators of near-term credit performance. The estimated claim rate on new notices received in the second quarter of 2021 was approximately 7.5% compared to approximately 7% in the second quarter of 2020. The reserve for incurred but not reported, or IBNR, increased by $4 million to approximately $24 million compared to an increase of $30 million in the second quarter of 2020. The increase this quarter is primarily due to the recording of a small loss related to some lingering litigation associated with policy disputes from several years ago. A review of loss reserves on previously received delinquent notices determined that there was immaterial loss reserve development in the quarter, compared to $10 million of unfavorable development in the second quarter of last year. Barring any material economic shocks, It appears that the second quarter of 2020 was the exception rather than the rule regarding the credit losses related to the pandemic. While we have seen cure activity from the large cohort of delinquency notices received in the second quarter of 2020, we have not yet seen enough evidence to make any reserve adjustments on these COVID related delinquencies. Of the approximately 43,000 loans in our delinquency inventory at June 30th, approximately 55% or 23,600 loans reported to us to be in forbearance and we estimate that the substantial majority of those loans in forbearance will reach the end of their forbearance period in the second half of 2021. The number of claims received in the quarter remained very low and were down 35 percent from the same period last year due to the various foreclosure and eviction moratoriums and primary paid claims in the quarter remained low at 11 million dollars. Since foreclosure and eviction moratoriums for GSE loans have been extended, and the CFPB has introduced additional procedural safeguards, we expect claim payments to remain modest for the next few quarters. Next, I wanted to spend a couple minutes talking about our balance sheet and capital position and our approach to capital management. We continue to believe that our balanced approach to maintaining a strong capital position, including the use of forward commitment quota share treaties by accessing the capital markets for excessive loss reinsurance via ILN transactions, provides the most flexibility to maximize the long-term value of both the writing company and the holding company. As Tim mentioned, this value can be created by writing more primary mortgage insurance, pursuing new business opportunities, retiring debt, paying dividends, or repurchasing stock. Our goal is to maintain financial flexibility at both the holding company and the writing company. At the holding company, this means maintaining a target level of liquidity well in excess of our near-term needs. At the operating company, it means maintaining a robust level of access to PMIRES, significant enough to enable growth even in times of stress and to be well positioned for any changes to our operating environment. These target levels are dynamic and change as the operating environment changes. At the end of the second quarter, we had approximately $772 million of holding company liquidity and a $2.3 billion access to the PMIRES minimum requirements at the writing company. There were two transactions subsequent to quarter end that directly support our goal of having financial flexibility at both the holding company and writing company. First, we completed our fifth excessive loss reinsurance transaction executed through an ILN, the third such transaction in the last 10 months. This most recent transaction provides $400 million of loss protection and increases our PMIR's access. Second, we paid a $150 million dividend from MGIC to our holding company. Taking a deeper dive on the holding company. We have said for some time that we have a target level of liquidity that is designed to maintain funds for multiple years of interest payments on outstanding debt, near-term maturing debt principle, strategic growth opportunities, and our quarterly common stock dividend. The holding company liquidity is above our current target levels, which supported the 33% increase in the common stock dividend. Additionally, in the third quarter, we intend to resume our share repurchase program And we expect that we will fully use the remaining $291 million repurchase authorization prior to its expiration at year end 2021. Taking a closer look at the writing company, it has a $2.3 billion access to the PMIRES requirement as of June 30th, or 167% PMIRES sufficiency ratio, which was above our current target level and supported the $150 million dividend from MGIC to our holding company. Going forward, we will continue to assess MGIC's capital position and will continue discussions with the OCI about additional dividends to our holding company as appropriate. As Tim mentioned, we feel we are well positioned to capitalize on the market opportunities that a robust housing market should make available to us. Given our strong market presence, a growing in-force book of business that is currently generating a low level of delinquencies, a comprehensive reinsurance program, and the quality of the new business being written. We believe that our holding company and writing company capital management strategy will create long-term value for shareholders, while allowing us to continue to be a well-capitalized counterparty for our customers. With that, let me turn it back to Tim.

speaker
Tim Matkey

Thanks, Nathan. Before moving to questions, let me address a few additional topics. The early indications from the Biden administration are that it is going to focus its housing policy efforts on access to sustainable and affordable housing foreclosure and eviction mitigation for homeowners impacted by COVID-19, and ensuring a successful economic recovery opposed to large-scale changes to the housing finance infrastructure. Although it's early in the tenure of the new FHFA Acting Director, Sandra Thompson, at this time we are not aware of any policy initiatives that will provide new challenges to our company or industry. I would expect that we will see a more coordinated effort from the various housing agencies of the U.S. government over the next several years. We will continue to advocate for the increased use of private mortgage insurance in the housing finance industry in order to reduce taxpayer exposure to housing while still maintaining a resilient housing finance system. Long term, I remain encouraged about the future role that our company and industry can play in housing finance and believe that other regulators and policymakers share a similar view. The COVID-19 pandemic reminded all housing finance participants that some options to credit enhancement for high LTV loans can be scarce or unavailable at various points in the economic cycle. However, our company and industry were organized solely to provide credit enhancement solutions to lenders, borrowers, and the GSEs in all economic cycles. Not only does private mortgage insurance offer dedicated capital day in and day out to the housing industry, it offers many solutions and a great value proposition for lenders and consumers to overcome the number one barrier to home ownership, the down payment. At MGIC, we are focused on providing critical support to the housing market, especially low and moderate income and first-time homebuyers. In summary, we are currently writing high levels of new insurance and are experiencing decreasing levels of delinquencies, both newly reported and those already in our delinquency inventory. We have a book of business that has strong underlying credit characteristics, which is supported by a strong and dynamic balance sheet with a low debt to capital ratio, investment portfolio of nearly $7 billion, contractual premium flow, and a robust reinsurance program. I am confident in our positioning in the market and we like the risk-reward equation that the current conditions offer. We have the right team in place to build off our solid foundation to continue to deliver competitive offerings and best-in-class service to our customers and generate strong returns for our shareholders. With that, operator, let's take questions.

speaker
Operator

As a reminder, to ask a question, you will need to press star 1 on your telephone. To withdraw a question, press the pan key, and please stand by while we compile the Q&A roster. Your first question is from Mark Mivries. Your line is open.

speaker
Mark Mivries

Yeah, thanks. I was hoping to drill down a little more on kind of the excess capital position. Nathan, thanks for all the color. It was helpful. But could you elaborate first on what expectation you have for kind of continued dividends up from the writing company and then Maybe help us quantify how to think about the excess liquidity at the holding company, just given kind of some of the maturities that you have, dividend obligations and kind of what that leaves for potential buybacks.

speaker
Tim Matkey

Sure, Mark. Tim, I'll take the first part of the question on dividend capacity and let Nathan answer a little bit on the holding company question. You know, from a dividend standpoint, we're really excited to be able to turn that dividend stream back on from MGIC to the holding company. As you know, once the pandemic started, we ceased those dividends, felt it was the right time. We were happy that our regulator, the OCI, felt it was the right time. So I think the level of that is 150 is reflective of a period where we weren't dividending out. But we also view that we're going to have hopefully strong financial results, and we'll continue discussions with the OCI about future dividends. But it's too early to say at what level and what the cadence of that might be.

speaker
Tim Mackey

Marcus, Nathan, just relative to the holding company, I think we laid out kind of the list that we think of for what we'd like liquidity to cover. I think also felt comfortable that with the $150 million dividend coming up that we do expect to use the full remaining repurchase authorization. So I think, you know, clearly felt like we had a little bit above our target levels. But, you know, we haven't gotten too specific on exactly what those target levels are. I think partly because we do view them as dynamic, want to be able to react to the current market and current conditions as appropriate. I think, you know, just leave you with, we do feel like we had above target levels, which supported the actions that we've taken, and we'll continue to reassess that going forward.

speaker
Mark Mivries

Okay, got it. Just a few clarifying points. Tim, do you expect to ultimately get back to kind of a regular cadence on those dividends up from the writing company like you had kind of pre-COVID? And does the $770 million of Holco liquidity that you mentioned, Nathan, does that already include the

speaker
Tim Mackey

150? Mark, this is Nathan. I'll take the last question there first. The $770 million was as of June 30th. The $150 million dividend was paid subsequent so that there would be, in addition to that, something on a pro forma basis slightly above $900 million.

speaker
Mark Mivries

Got it.

speaker
Tim Matkey

Mark, to your question about regular cadence, my hope would be we get back to regular cadence. I think What ultimately is most important is us to be able to have the dialogue to get out the amount that we think we should get out of MGIC and that the OC is comfortable with. So I don't know if that means that we're back on a quarterly cadence right now, but that was how we were operating pre-COVID. And I guess right now my hope and expectation would be we would get back to that. But, again, we will continue to have those conversations with our regulator.

speaker
Mark Mivries

Okay, great. Thank you.

speaker
Tim Matkey

Thanks.

speaker
Operator

Your next question is from Bose George. Your line is now open.

speaker
Bose George

Hey guys, good morning. Actually, just one more on the capital. In terms of the excess at the Holdco, to the extent that the next maturity is essentially refinanced, does that sort of increase the excess at that point, the way you guys look at it?

speaker
Tim Mackey

Bose is Nathan. I think you know, right now the liquidity target would include the fact that we've got, you know, some debt maturing in the next couple of years. So if, you know, if that wasn't the case, then, you know, we would kind of reassess based on those conditions.

speaker
Bose George

Okay. Great. Thanks. And then actually just switching over to your default to claim. So that was, you know, 8% this quarter. And I guess it was on new notices versus 7% earlier. So just Curious about the drivers of that.

speaker
Tim Mackey

Yeah, it's Nathan again. I think what in the prepared remarks, the new notice claim rate was approximately 7.5%. So that's up a little bit, flat quarter over quarter, but up a little bit from the second quarter of last year. But the number of forbearance notices in the second quarter last year was off memory, I think, north of 80%, whereas it's more normalized today. So It really didn't view much change from our perspective in the new notice claim rate this quarter compared to where we've been trending over the last few quarters.

speaker
Bose George

Okay. Great. Thanks. Actually, maybe just one more. In terms of the reduction in the premium margin, that one basis point a little over this quarter, can we see that cadence continue for the next few quarters, and when should that bottom?

speaker
Tim Mackey

Yeah, it's Nathan again. I mean, I do think what we've said for some time is we do expect that to continue to trend down. I think the exact pace, particularly of the net premium yield, is more difficult to judge quarter over quarter due to reinsurance transactions and due to accelerated singles. But focusing on that in-force premium yield, it has been coming down between a basis point and a basis point and a half. I do think, you know, I think that's a decent run rate for at least the next couple of quarters. But as you get out much beyond that, it really starts to become dependent on a lot of other variables and factors. So, you know, where that bottoms out or if it, you know, I think that's probably a little difficult to say and really subject to a lot of things that haven't happened yet that will happen to the balance of 21 and into 22 and beyond.

speaker
Bose George

Okay, great. Thanks.

speaker
Operator

Your next question is from Jeffrey Dunn. Your line is now open.

speaker
Jeffrey Dunn

Thanks. I wanted to revisit capital. Entering COVID, your opco dividend strategy had evolved to, I think it was 70 million a quarter supplemented with a special. Would that still be the intention going forward? Or are you thinking about trying to increase that quarterly amount to something much more substantial? or possibly just shifting to annual specials?

speaker
Tim Matkey

Jeff, it's Tim. It's a good question. I would tell you we continue dialogue with the OCI on that. Our preference had been the quarterlies because it matched up to, you know, dividend and interest cash flow at the holding company. So in response to the question earlier, that's why I hope to get back there. But ultimately, I think that combination along with the specials, I think that worked well for us. And my expectation is that we get back there based upon sort of what I know at this point. But I'm more focused, I think, on the level that we can get out on an annual basis. And so that's why I guess I'm hedging a little bit is just until we see that we're back on a quarterly cadence, I don't want to, I guess, overpromise that quarterly cadence versus continue that dialogue with the OCI. Okay.

speaker
Jeffrey Dunn

Okay. And then as you consider dividends, I mean, I think a lot of people think of it as opportunity, but obviously the excess capital buildup is an ROE drag. So, and I mean, I don't know, no matter what measure you look at it, the industry has way too much capital. Are there any surplus constraints from management's or board's perspective? You know, is there a certain level that you prefer to hold since it seems like some companies can bring that down as low as, you know, just a couple hundred million?

speaker
Tim Mackey

Jeff, it's Nathan. I'd say, you know, our primary operating company, MGIC, has about $1.4 billion in surplus, maybe $1.3. So I don't think we would be, at this point, particularly close to any, you know, floor level. So, you know, if that is something that we consider, I don't think it would be in the near term. But, you know, I think we've observed the same thing, that that regulators have gotten comfortable with companies running with relatively little surplus but still a lot of capital when you consider contingency reserves.

speaker
Jeffrey Dunn

Okay. And then last thing is I think you have two pieces of debt, your FHLB notes and then the senior notes coming due in 23. Is a mid to upper teens debt to cap ratio still appropriate in the industry from your perspective? Or is there a desire to run lower than that considering the leverage that ILNs have added?

speaker
Tim Mackey

It's Nathan. I think it's a really good question. I mean, the Federal Home Loan Bank that for us initially was used to provide liquidity for the operating company to repurchase the outstanding junior converts that the holding company had issued. I don't think we view that as kind of permanent capital. You know, I've looked at repaying it, but don't like the economics of doing that right now. So, you know, that's going to, I think, just kind of run off with really no thought at this point around refinancing that. In terms of the long-term debt-to-capital ratio, I think we're pretty comfortable with where we are today. I don't feel like we need to kind of de-lever. But at the same time, I think we'd be comfortable with the longer-term debt-to-capital ratio that's below where we are today. And I think Moody's, for instance, has put out there that one of the factors potentially leading to an upgrade would be a debt-to-capital in the 15% range. So I think something in the mid-teens would also be comfortable for us over time.

speaker
Jeffrey Dunn

Okay, thank you.

speaker
Operator

Your next question is from Colin Johnson. Your line is now open.

speaker
Colin Johnson

Hey, thanks. Good morning. Thanks for taking my question. I know we've talked a good bit about capital here, but just kind of looking at that August excess of loss deal, is it fair to think of the recent dividend increase and the share repurchase resumption almost as a byproduct of the capital that was freed up there? Or were those decisions kind of already made before that reinsurance was contemplated?

speaker
Tim Mackey

Yeah, good question. It's Nathan. Yeah, I think that's certainly a piece of it. I mean, the ILN that we did in August was, like I said in the prepared remarks, the third transaction in the last 10 months for us. It's certainly continuing to execute on our risk distribution strategy. So I wouldn't tie a one-for-one. I think it's holistic of the capital that we've organically generated plus the reinsurance treaties that we've done, plus, and most importantly, just how the operating results have improved post the second quarter of last year. But I wouldn't probably draw too tight of a link, I guess, between the August ILN issuance and these transactions.

speaker
Colin Johnson

Got it. Thank you. That's helpful. And then just kind of shifting gears a little bit to home price appreciation. So kind of given the rate of home price appreciation we've seen, you know, it's put borrowers in a position of positive home equity, you know, that should reduce the incentive to kind of go to foreclosure for borrowers that are in the situation. Are you seeing that play out in the data that you have available to you?

speaker
Tim Mackey

I think, Nathan, again, I mean, at this point it's really difficult with the foreclosure moratoriums and the like. We're just not seeing a lot of progress through. But, you know, certainly broad-based home price appreciation is a positive for claim incidents and potentially a positive for severity as well. But like we've said over time, even in rising home price markets, we still pay claims. We're dealing with averages there and the loans that go to claim aren't average loans. So I do think that it's likely to be a benefit. We've certainly seen that in the kind of paid to exposure ratios that we put out being below 100 the last few quarters. I think that's reflective of the current environment. But I still think even in rising home price environments, we still expect that we're going to pay claims.

speaker
Colin Johnson

OK. So we might be able to see a little bit more color on that as does foreclosure moratoria run out. Thank you. Those are all my questions. Thanks.

speaker
Operator

Your next question is from Mihir Bhatia. Your line is now open.

speaker
Mihir Bhatia

Hi, good morning and thank you for taking my question. A lot of the capital return questions have been asked already, so maybe I'll just ask a quick one on the reserves and delinquencies. Your reserve for delinquency is up to about 21,400-ish. That's about the level it was in 2018, 2019. I guess my question is, how are you thinking about it, or how should we be thinking about it trending from here? Just trying to understand, given the strong home price appreciation, the fact that so many of your delinquencies are still forbearance-related, I'm a little surprised that it would stay that high, and maybe how should we be thinking about that from here as the situation develops?

speaker
Tim Mackey

Sure. It's Nathan. I think it's largely a function of the fact that so few delinquent loans are being resolved via claim at this point. So until we're comfortable making changes to our initial estimates, the kind of way the math works is that the loans that cure, they don't really change your estimates, so then the average reserve for the ones that remain continues to go up. And with, you know, forbearance periods being extended to 18 months and with foreclosure moratoriums, it's not clear whether there's going to be a lot of, you know, kind of paid resolution through the balance of this year, maybe not even into early next year. So I don't think that that is, you know, it's not really a change in reserve philosophy or methodology or a belief that those loans are now going to be worse than they were a quarter or two ago. Just the fact that, You know, we're not seeing the resolution, so those that remain, you know, we've got a lot more in the 12-month, you know, kind of delinquent bucket than we had at that time. You know, so I think it's largely just kind of an artifact of the current situation and the fact that there's really nothing being resolved right now other than cures. So, until we're ready to, you know, comfortable and have seen enough data, you know, to feel like we want to adjust our initial estimates, I think that same process will continue to play out.

speaker
Mike Zimmerman

And here's Mike, just to add that too, all the things Nathan said about aging is true, but the vintage years too, because of the forbearance, right? There are a lot of newer loans, right? The 18, 19 books, those have higher balances than the 13, 14. So it's all what Nathan said, plus you have larger loans. Got it.

speaker
Mihir Bhatia

Okay. No, that is very helpful. Thank you. And then just one question more for me on pricing. I just wanted to, you know, understand it's difficult to predict, you know, the enforced yield, if you will, but your comments about them trending lower in general, I appreciate that. But maybe talk about just the pricing environment today that you're seeing in the market versus, like, say, two quarters ago or a quarter ago even where it felt like there was a lot more talk about competitive intensity or certain things. some price competition taking a little bit more, I guess, higher level of price competition taking place. What are you seeing in the market today? Thank you.

speaker
Tim Matkey

Yeah, and again, we don't like to talk too specific on pricing. I think, you know, I look back over the last 12 to 18 months, and I think we've talked about it before, is onset of the pandemic, higher risk associated, perceived risk associated with the loans that we were insuring. from our perspective at least. Again, I assume others in the industry. So we saw price increases. I think that's normalized, come down over the period of time as the economies continue to be, I guess, robust. And housing in particular has been not only resilient, but actually been really strong. And so I think you saw sort of pricing normalized. And as we talked, I think, last quarter, I think maybe From a competitive standpoint, you know, we see what we see as far as we're reflecting on our pricing. We don't necessarily know exactly how other people are viewing it, but I think it's safe to assume based upon, I think, what you can observe and what we've heard other people say, that people feel really good with this current market, current housing market, current economy, and pricing's reflective of that, but still generating strong, you know, returns, and we still feel really good about the risk-return equation.

speaker
Mihir Bhatia

Okay, thank you. Sure.

speaker
Operator

And for your questions, I would now like to turn the call back to Mr. Mike Zimmerman. Sir, please go ahead.

speaker
Tim Matkey

Sure, this is Tim. I just wanted to thank everyone for their interest in MGIC, and we will talk soon. Thanks.

speaker
Operator

And this concludes today's conference call. Thank you for participating. You may now disconnect.

Disclaimer

This conference call transcript was computer generated and almost certianly contains errors. This transcript is provided for information purposes only.EarningsCall, LLC makes no representation about the accuracy of the aforementioned transcript, and you are cautioned not to place undue reliance on the information provided by the transcript.

-

-