NMI Holdings (NASDAQ:NMIH) reported first-quarter financial results on Thursday. The transcript from the company’s first-quarter earnings call has been provided below.
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Summary
NMI Holdings reported a record $183.5 million in total revenue for the first quarter, with an adjusted net income of $99.4 million or $1.28 per diluted share, and a 15.2% adjusted return on equity.
The company achieved $12.3 billion in new insurance written (NIW) and ended the quarter with a record $222.3 billion in primary insurance in force, highlighting strong business performance.
Management emphasized the resilience of the housing market and the macroeconomic environment, noting that while macro risks remain, the company is well-positioned due to its disciplined approach to risk management and underwriting.
Operational highlights include a strong customer franchise, disciplined expense management, and a robust balance sheet, supported by strategic investments in people and technology.
Management indicated confidence in future performance, citing consistent growth opportunities in the MI market, driven by long-term secular trends and sustained demand for mortgage insurance.
Full Transcript
OPERATOR
Good day and welcome to the NMI Holdings Inc. First quarter 2026 earnings conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today’s presentation there will be an opportunity for questions. To ask a question, you may press star then one on a touch tone phone. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to John Swenson of Management. Please go ahead.
John Swenson (Vice President of Investor Relations and Treasury)
Thank you, operator. Good afternoon and welcome to the 2026 first 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, Adam Pollitzer, President and Chief Executive Officer and Aurora Swithenbank, our Chief Financial Officer. Financial results for the quarter were released after the close today. The press release may be accessed on NMI Holdings’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 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 may refer to certain non GAAP measures. In today’s press release and on our website, we’ve 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 first quarter National MI again delivered standout operating performance, continued growth in our insured portfolio and strong financial results. Our lenders and their borrowers continued to turn to us for critical down payment support and in the first quarter we generated 12.3 billion of new insurance written (NIW) volume, ending the period with a record 222.3 billion of high quality, high performing primary insurance in force. In Washington, our conversations remain active and constructive. We have long noted that there is bipartisan recognition of the unique and valuable role that the private mortgage insurance industry plays. We are in the market every day with a clear mandate and purpose, offering a low cost, high value solution that helps borrowers bridge the down payment gap and meaningfully reduces the cash required at the closing table. In the process, we help to make homeownership more affordable and achievable for millions of Americans in communities across the country with coverage that works to insulate the GSEs and taxpayers from risk and loss in a downturn. National MI and the broader private MI industry have never been stronger or better positioned to provide support than we are today, and we’re looking forward to continuing to work with the administration to advance their important housing goals. With that, let me turn it over to Adam.
Brad Schuster (Executive Chairman)
Thank you Brad and good afternoon everyone. National MI continued to outperform in the first quarter, delivering significant new business production, consistent growth in our insured portfolio and strong financial Results. We generated $12.3 billion of new insurance written (NIW) volume and ended the period with a record $222.3 billion of high quality, high performing primary insurance in force. Total revenue in the first quarter was a record $183.5 million and we delivered adjusted net income of $99.4 million or $1.28 per diluted share and a 15.2% adjusted return on equity. Overall, we had a terrific quarter and are confident as we look ahead. The macro environment and housing market have remained resilient through an extended period of headline volatility. Our lender customers and their borrowers continue to rely on us in size for critical down payment support and we see an attractive and sustained new business opportunity and fueled by long term secular trends. We have an exceptionally high quality insured portfolio covered by a comprehensive set of risk transfer solutions and our credit performance continues to stand ahead. We’re delivering consistent growth and embedded value gains in our insured book and we continue to manage our expenses and capital position with discipline and efficiency, building a robust balance sheet that’s supported by the significant earnings power of our platform. Taken together, we see a clear opportunity for continued outperformance. Notwithstanding these strong positives, however, macro risks do remain and we’ve maintained a proactive stance with respect to our pricing, risk selection and reinsurance decisioning. It’s an approach that has served us well and continues to be the prudent and appropriate course. More broadly, we’ve been encouraged by the continued discipline that we see across the private MI market. Underwriting standards remain rigorous and the pricing environment remains balanced and constructive. Overall, we had a terrific quarter, delivering strong operating performance, consistent growth in our insured portfolio and strong financial results. Looking ahead, we’re well positioned to continue to serve our customers and their borrowers, invest in our employees and their success, drive growth in our high quality and short portfolio and deliver through the cycle growth returns and value for our shareholders. With that, I’ll turn it over to Aurora.
Adam Pollitzer (President and Chief Executive Officer)
Thank you Adam we again delivered strong financial results in the first quarter. Total revenue was a record 1:83.5 million. Adjusted net income was 99.4 million or $1.28 per diluted share and adjusted return on equity was 15.2%. We generated $12.3 billion of new insurance written (NIW) and our primary insurance in force grew to $222.3 billion. Twelve month persistency was 82.2% in the first quarter compared to 83.4% in the fourth quarter. Net premiums earned in the first quarter were a record 154.8 million compared to 152.5 million in the fourth quarter and 149.4 million in the first quarter of 2025. Net yield for the quarter was 28 basis points, consistent with the fourth quarter. Core yield, which excludes the cost of our reinsurance coverage and the contribution from Cancellation earnings was 34 basis points, also unchanged from the fourth quarter. Investment income was $28.6 million in the first quarter compared to 27.5 million in the fourth quarter and 23.7 million in the first quarter of 2025. Total revenue was a record $183.5 million in the first quarter, up 2% compared to the fourth quarter and 6% compared to the first quarter of 2025. Underwriting and operating expenses were $30.6 million in the first quarter Compared to $31.1 million in the fourth quarter. Our expense ratio was 19.8% in the quarter compared to 20.4% in the fourth quarter. We have a uniquely high quality insured portfolio and our credit performance continues to stand out. We had 8,044 defaults at March 31 compared to 7,661 at December 31 and our default rate was 1.17% at quarter end. Claims expense in the first quarter was 20.7 million compared to 21.2 million in the fourth quarter and and 4.5 million in the first quarter of 2025. GAAP net income for the first quarter was 99.3 million and diluted earnings per share was $1.28. Adjusted net income was 99.4 million and adjusted diluted EPS was also $1.28. Shareholders equity as of March 31 was 2.6 billion and book value per share was $34.57. Book value per share, excluding the impact of net unrealized gains and losses in the investment portfolio was $35.46, up 3% compared to the fourth quarter and 15% compared to the first quarter of last year. In the first quarter we repurchased $27.7 million of common stock, retiring 716,000 shares at an average price of $38.65. Since starting our buyback program in 2022, we’ve repurchased a total of $377 million of common stock, retiring 12.8 million shares at an average price of $29.43. We have $198 million of repurchase capacity remaining under our existing program. At quarter end we reported $3.6 billion of total available assets under PMERS and 2.2 billion of risk based required assets. Excess available assets were 1.5 billion. Overall, we achieved robust financial results during the quarter, delivering consistent growth in our high quality portfolio, record top line performance, continued expense efficiency and strong bottom line profitability and returns. With that, let me turn it back to Adam.
Aurora Swithenbank (Chief Financial Officer)
Thank you Aurora. We had a terrific quarter once again delivering significant new business production, consistent growth in our high quality insured portfolio and strong financial results. We have a strong customer franchise, a talented team driving us forward every day, an exceptionally high quality book covered by a comprehensive set of risk transfer solutions and a robust balance sheet supported by the significant earnings power of our platform. Taken together we we are well positioned to continue to serve our customers and their borrowers, invest in our employees and their success, drive growth in our high quality insured portfolio and deliver through the cycle growth, returns and value for our shareholders. Thank you for joining us today. I’ll now ask the operator to come back on so we can take your questions.
Adam Pollitzer (President and Chief Executive Officer)
Thank you. We will now begin the question and answer session. To ask a question, you may press star then one on your touch tone phone. If you’re using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then two. At this time we will pause momentarily to assemble our roster. The first question today comes from Bose George with kbw. Please go ahead.
OPERATOR
Hey everyone, Good afternoon. First wanted to ask what was the default a per new notice this quarter, you know versus last quarter. That’s a little hard to calculate sometimes with the intra quarter cures.
Bose George
Okay, great. And in terms of the delinquency rate in the first quarter, , over the fourth quarter, in line with expectations is given the seasonality increase. But obviously it was a very modest increase. Okay, great. Actually just one more on credit, the loss severity number trended up a little bit as well. Anything to call out there or is it just a small cohort of loans there? Yeah, but we only paid 170 claims in Q1, so it’s still a very small pool to draw from.
OPERATOR
Yeah, yeah, absolutely. So okay, great. Thank you.
Terry Ma
The next question comes from Terry Ma with Barclays. Please go ahead.
Terry Ma
Got it. That’s super helpful. I guess maybe taking a step back. Big picture. I think it’s well known and also well messaged that the MI industry is experiencing measured credit normalization. Is there anything in this quarter that may suggest that that rate of normalization may be accelerating? Because at least from the outside looking in, from what we could see, it looks like new notices are accept accelerating on a year over year basis. The cure rate is lower also relative to last year. So like anything that may suggest that the rate of credit normalization may be accelerating or should it just kind of stay stable, Any color would be helpful. Thank you. Got it, thank you.
OPERATOR
The next question comes from Rickshane with JPMorgan. Please go ahead.
Rickshane
Hey guys, thanks for taking my question. I apologize. I’ve got a few things going on here. But look, you know we first Quarter and we talked about this a lot with the consumer finance names. First quarter was sort of a tale of two quarters. And I would describe we had January and February pre Iran, we’re now March and April. We have two months post. I am curious how that sort of impacted the contours of your quarter in terms of volume and also curious if you saw anything else that we should be aware of. Got it. Okay, Adam, thank you very much.
OPERATOR
The next question comes from Mark Hughes with Truist. Please go ahead.
Mark Hughes
Thanks. Good afternoon. I wonder if you could talk about the competition, the competitive dynamic in the quarter. Your NIW was quite strong year over year. I think you just touched on the cancellations, which I assume was a little more refi activity in the quarter. But anything you would say about competition, what that implies for the balance of the year. understood. And then on expenses, just in absolute terms, you’ve been last 3/4 kind of down a little bit, up a little bit year over year on expenses and that’s contributed to nice leverage. Does that pattern continue in subsequent quarters on an absolute basis? Maybe just a modest progression. Thank you very much
OPERATOR
again. If you have a question, Please press star then 1. The next question comes from Mehir Bhatia with Bank of America. Please go ahead.
Mehir Bhatia
Hey, good afternoon. Thanks for taking my question, Adam, and wanted to go back to the credit discussion a little bit, maybe just on credit losses in period losses in particular. I think they were up pretty materially like 13 million year over year versus new notices up being 300. It sounded like you didn’t change any assumptions. Maybe just talk a little bit about that. Is that just like the extra 13 million is just from the 300 new notices? Okay, and then is that the same like I guess is the mix and the mark to market of the loss, Is that what’s also driving the reserve per default assumption higher? Like I’m just trying to understand because Obviously you release 26 million of prior period reserves, but the reserve for default is moving higher. Is that just the same thing that. Got it. Maybe just turning to NIW for a second. I think it was down a little bit quarter over quarter. I know everyone hasn’t reported yet, so we don’t have market share, but I’m sure you do some ongoing monitoring. Maybe just decompose some of that for us. Like what are some of the key factors driving it? I imagine a little bit smaller market. But did you see any shifts in market share? Is there any mix shift going on, whether from the bulk market or what have you that’s driving that would make you think your results would be different than some of your peers? force continuing to accrete higher and then just. I’ll end with reinsurance question. The profit commission has been trending a little bit lower. Is that just a function of normalizing credit defaults? Something else going on there? Got it. Thank you.
OPERATOR
This concludes our question and answer session. I’d like to turn the conference back over to management for any closing remarks.
Disclaimer: This transcript is provided for informational purposes only. While we strive for accuracy, there may be errors or omissions in this automated transcription. For official company statements and financial information, please refer to the company’s SEC filings and official press releases. Corporate participants’ and analysts’ statements reflect their views as of the date of this call and are subject to change without notice.
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