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Genworth MI Canada Inc. – First Quarter 2013
Genworth MI Canada Inc. – First Quarter 2013
Genworth MI Canada Inc. – First Quarter 2013
Genworth MI Canada Inc. – First Quarter 2013
Genworth MI Canada Inc. – First Quarter 2013
Genworth MI Canada Inc. – First Quarter 2013
Genworth MI Canada Inc. – First Quarter 2013
Genworth MI Canada Inc. – First Quarter 2013
Genworth MI Canada Inc. – First Quarter 2013
Genworth MI Canada Inc. – First Quarter 2013
Genworth MI Canada Inc. – First Quarter 2013
Genworth MI Canada Inc. – First Quarter 2013
Genworth MI Canada Inc. – First Quarter 2013
Genworth MI Canada Inc. – First Quarter 2013
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Genworth MI Canada Inc. – First Quarter 2013

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  • 1. First Quarter 2013May 1, 2013Genworth MI Canada Inc.
  • 2. Q1 2013 May 1, 2013Genworth MI Canada Inc. 2Forward-looking and non-IFRS statementsThis presentation includes certain forward-looking statements. These forward-looking statements include, but are not limitedto, statements with respect to the Company’s future operating and financial results, expectations regarding premiumswritten, capital expenditure plans, dividend policy and the ability to execute on its future operating, investing and financialstrategies, and other statements that are not historical facts. These forward-looking statements may be identified by their use ofwords such as “may,” “would,” “could,” “will,” “expects,” “anticipates,” “contemplates,” “intends,” “plans,” “believes,” “seeks,”“estimates,” or words of similar meaning. These statements are based on the Company’s current assumptions, includingassumptions regarding economic, global, political, business, competitive, market and regulatory matters. These forward-lookingstatements are inherently subject to significant risks, uncertainties and changes in circumstances, many of which are beyond thecontrol of the Company. The Company’s actual results may differ materially from those expressed or implied by such forward-looking statements, including as a result of changes in the facts underlying the Company’s assumptions, and the other risksdescribed in the Company’s Annual Information Form dated March 29, 2013, its Short Form Base Shelf Prospectus dated May31, 2012, the Prospectus Supplements thereto and all documents incorporated by reference in such documents. Other than asrequired by applicable laws, the Company undertakes no obligation to publicly update or revise any forward-lookingstatement, whether as a result of new information, future developments or otherwise.To supplement its financial statements, the Company uses select non-IFRSs financial measures. Non-IFRSs measures used by theCompany to analyze performance include underwriting ratios such as loss ratio, expense ratio and combined ratio, as well as otherperformance measures such as net operating income and return on net operating income. The Company believes that these non-IFRSs financial measures provide meaningful supplemental information regarding its performance and may be useful to investorsbecause they allow for greater transparency with respect to key metrics used by management in its financial and operationaldecision making. Non-IFRSs measures do not have standardized meanings and are unlikely to be comparable to any similarmeasures presented by other companies. These measures are defined in the Company’s glossary, which is posted on theCompany’s website at http://investor.genworthmicanada.ca. A reconciliation from non-IFRSs financial measures to the mostreadily comparable measures calculated in accordance with IFRSs can be found in the Company’s most recent financialstatements, which are posted on the Company’s website and are also available at www.sedar.com.
  • 3. Q1 2013 May 1, 2013Genworth MI Canada Inc. 3Solid Q1 2013 results across key metricsNet operating income $ 85 MM $76 MMOperating Return on equity 12% 12%Operating earnings per share (diluted) $0.86 $0.77Q1 2013 Q1 2012Book Value Per Share (diluted, including AOCI)$27.31 $27.88$28.72$30.62$31.32Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 201315% YoY growth
  • 4. Q1 2013 May 1, 2013Genworth MI Canada Inc. 4Consistent resultsPriorities First Quarter 2013 Premiums written $84 million of new premiums written Prudent risk management Loss ratio of 31% Investment portfolio return $5.3 billion investment portfolioBook yield of 3.7% as at March 31, 2013 Capital strength Minimum capital test of 216% Dividends and return toshareholdersQuarterly dividend of $0.32 per common shareNormal course issuer bid announced
  • 5. Q1 2013 May 1, 2013Genworth MI Canada Inc. 5Positive trends in delinquency rateMortgage insurance portfoliodelinquency rateInsurancein-forceMarch 312013Dec 312012Sept 302012March 312013Ontario 0.08% 0.09% 0.09% 46%BC 0.20% 0.18% 0.18% 15%Alberta 0.18% 0.22% 0.24% 16%Quebec 0.19% 0.19% 0.20% 14%Other 0.15% 0.14% 0.15% 9%Canada 0.14% 0.14% 0.15% 100%
  • 6. Q1 2013 May 1, 2013Genworth MI Canada Inc. 6Recent federal budgetConsultations with government underway No changes to high loan-to-value products Proposal to limit use of portfolio insurance to gov’t sponsored securitization programs Proposal to prohibit use of insured mortgages in private securitization programs MIC insured mortgages eligible for gov’t sponsored securitization programs Majority of MIC insured mortgages currently securitized through these programsMarch budget overviewImpact on MIC
  • 7. Q1 2013 May 1, 2013Genworth MI Canada Inc. 7Canadian market outlook Economy to grow modestly in 2013 … Second half stronger than first Moderate income growth Stable employment outlookHousing market Low rates and steady employment continues to support housing Balanced market expected to keep prices relatively flat Market adapting to lower more sustainable level of housing activity Borrower quality remains highMacroeconomic environment
  • 8. Q1 2013 May 1, 2013Genworth MI Canada Inc. 8Book value continues to grow$ millions (except EPS) Q1 2013 Q4 2012 Q1 2012Net premiums written $84 $ 117 $79Premiums earned 144 147 147Losses on claims (44) (46) (56)Underwriting income 74 73 65Adjusted net investment income(excluding gains/losses)45 46 43Adjusted net operating income $85 $89 $76Adjusted operating EPS (diluted) $0.86 $ 0.90 $0.77Book value per share(diluted and including AOCI)$31.32 $ 30.62 $27.31Demonstrated track record of performance
  • 9. Q1 2013 May 1, 2013Genworth MI Canada Inc. 9Core business outpaced market6912116099719111033347111711Q1 2012Q2 2012Q3 2012Q4 2012Q1 2013($millions)RefinanceGross PW 82 179 181 119 84Risk premium (3) (2) (3) (2) -Net PW $79 $176 $178 $117 $84PurchasePortfolio3Premiums writtenQ1‘12 Q2‘12 Q3‘12 Q4‘12 Q1‘13$1.7 billion in unearned premiums Lower housing activity as housing markettransitions to more sustainable level Resale volumes down 15% year-over-year Improved market penetration partiallyoffset smaller higher loan-to-value market Continued demand for portfolio insurance(PW represents premiums written)
  • 10. Q1 2013 May 1, 2013Genworth MI Canada Inc. 10Solid underwriting performance65 76 77 73 742625 26 28 2656 484446 44Q112 Q212 Q312 Q412 Q113$147Underwriting profit$144Premiums earnedUnderwritingprofitExpensesLosses onclaims$147Loss ratio 38% 32% 30% 31% 31%Expense ratio 18% 17% 18% 19% 18%Combinedratio56% 49% 48% 50% 49% New reported delinquenciesdeclined by 6% sequentially despitetypical seasonal pressures Q1 loss ratio flat sequentially Continued success with lossmitigation programs$148 $147Consistent underwriting profit($millions)
  • 11. Q1 2013 May 1, 2013Genworth MI Canada Inc. 11Cash5%Federal35%Provincial14%Corporates40%CommonEquity6%Investment portfolio remains high quality Balanced high quality portfolio• 49% federal & provincial bonds• 40% corporate bonds• 96% of bonds ‘A’ or higher $324 million positive mark-to-marketTotal$5.3 billion1Pre-tax equivalent book yield after dividend gross-up of general portfolio(as at March 31, 2013)$ Billion PortfolioAssets (MV) $5.3Pre-tax yield1 3.7 %Duration 3.6 years
  • 12. Q1 2013 May 1, 2013Genworth MI Canada Inc. 12Strong capital position with flexibility145% 145% 145%185% 185%11% 17% 25%25% 31%156%162%170%210%216%2010 2011 2012 1-Jan-13 31-Mar-13Minimum Capital Test RatioBufferInternal MCT ratio targetMCT ratioNormal course issuer bid announced
  • 13. Q1 2013 May 1, 2013Genworth MI Canada Inc. 13Disciplined executionProven business modelSolid financial foundationStrategic priorities remain the sameProfitability remains a key focus
  • 14. Q1 2013 May 1, 2013Genworth MI Canada Inc. 14Question and AnswerSAMANTHA CHEUNGVP INVESTOR RELATIONS905 287 5482samantha.cheung@genworth.comwww.genworth.caFor further info:

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