MGIC Investment Corporation

Ladies and gentlemen, thank you for standing by and welcome to the MGIC Investment Corporation second quarter 2025 earnings call. At this time, all lines have been placed on mute to prevent any background noise. At the end of today's presentation, we will have a question and answer session. I will now turn the conference over to Diana Higgins, head of investor relations. Please go ahead.

Thank you, Brittany. Good morning and welcome, everyone. Thank you for your interest in MGIC. Joining me on the call today to discuss our results for the second quarter are Tim Mackey, Chief Executive Officer, and Nathan Coulson, Chief Financial Officer and Chief Risk Officer. Our press release, which contains MGIC's second quarter financial results, was issued yesterday. and is available on our website at mtg.mgic.com under newsroom includes additional information about our quarterly results that we will refer to during the call today. It also includes a reconciliation of non-GAAP financial measures to their most comparable GAAP measures. In addition, we posted on our website a quarterly supplement that contains information pertaining to our primary risk and force and other information you may find valuable. As a reminder, from time to time, we may post information about our underwriting guidelines and other presentations or corrections to past presentations on our website. Before getting started today, I want to remind everyone that 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 the factors that could cause actual results to differ materially from those discussed on the call today are contained in our Form 8-K and 10-Q files yesterday. If we make any forward-looking statements, we are not undertaking an obligation to update those statements in the future in light of subsequent development. No one 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 our 8K or 10Q. With that, I now have the pleasure to turn the call over to Tim.

Thanks, Diana, and good morning, everyone. In the second quarter, we recorded net income of $193 million and an annualized return on equity of 15%. Our performance this quarter and throughout the first half of the year reflects our continued disciplined approach to the market, prudent risk and capital management strategies, and our ongoing commitment to creating long-term value for our stakeholders. During the quarter, we wrote $16 billion of new insurance. Insurance and force, the primary driver of our revenue, ended the quarter at $297 billion. Annual persistency was 85% at the end of the quarter. Both insurance and force and annual persistency remain relatively flat over the past two quarters, in line with our expectations at the start of the year. We continue to be encouraged by the strong credit performance of our insurance portfolio. Our disciplined risk management and strong underwriting standards remain key drivers of the quality of our portfolio, and the new insurance we've written continues to have solid credit characteristics. As always, we remain focused on building and maintaining a high-quality, well-diversified portfolio that supports our long-term success. Turning to capital management, as we discussed on prior calls, our strategy is grounded in maintaining financial strength and flexibility to best position ourselves to navigate and achieve success in a range of economic scenarios. Key objectives include supporting growth by maintaining strong capital at the operating company and the holding company, sustaining a low-to-mid-teens debt-to-capital ratio, and a healthy liquidity buffer. When these objectives are met, we remain committed to returning excess capital to shareholders through share repurchases and common stock dividends. During the second quarter, we continued to allocate excess capital to share repurchases, which totaled 7.1 million shares for $181 million. We also paid a quarterly common stock dividend of 13 cents per share, totaling $31 million. Over the prior four quarters, share repurchases totaled $721 million and shareholder dividends totaled $132 million. Combined, this represents a 112% payout on the net income we earned in the period. In addition, in the third quarter through July 25th, we were purchased an additional 2.6 million shares of common stock for $68 million. This share repurchase activity continues to reflect our capital strength and solid financial results. As of July 25th, we had $734 million remaining on our current share repurchase authorization. We continue to expect share repurchases will remain our primary method of returning capital to shareholders, while at the same time continuing to pay a quarterly common stock dividend. As previously announced, in the second quarter we paid a $400 million dividend from MGIC to the holding company, ending the quarter with $1 billion of liquidity at the holding company. As always, we prioritize prudent growth over capital return. However, if market conditions have continued to limit our growth of insurance and force, a trend we expect will persist through the remainder of the year. As a result, if credit performance remains strong, we anticipate capital levels of both MGIC and the holding company will stay above targets, supporting the continuation of elevated payout ratios. The strong financial position of both the holding company and the operating company were key factors in the board last week authorizing a 15% increase to our quarterly common stock dividend to 15 cents per share, marking five consecutive years of dividend increases, with a compound annual growth rate of 20% over that period. Turning more broadly to the current environment, while the housing market continues to face headwinds from elevated interest rates, ongoing affordability challenges, and a slowdown in home sales. We remain encouraged by demographic trends and pent-up demand supporting long-term growth and MI opportunities. Nationally, home price growth has moderated, and many markets, particularly in the South and West, are seeing rising inventory, but to date, the housing market has remained resilient. And while affordability remains a challenge for many prospective homebuyers, private mortgage insurance continues to play a critical role in helping low-down payment borrowers access homeownership sooner. Now let me turn it over to Nathan to get into more details on our financial results for the quarter.