As used below, "we," "our" and "us" refer to MGIC Investment Corporation's consolidated operations or to MGIC Investment Corporation, as the context requires, and "MGIC" refers to Mortgage Guaranty Insurance Corporation. We are not undertaking any obligation to update any forward-looking statements or other statements we may make even though these statements may be affected by events or circumstances occurring after the forward-looking statements or other statements were made. No person should rely on the f ...

Financial Data and Key Metrics Changes - The company reported net income of $183 million, with an annualized return on equity of 15.1% [59] - Earnings per diluted share decreased to $0.64 from $0.81 a year ago, while adjusted net operating income also fell from $0.86 to $0.64 [9][59] - Book value per share increased by 14% year-over-year to $17.37, driven by strong results and share repurchases [11] Business Line Data and Key Metrics Changes - New insurance written (NIW) was $14.6 billion, while insurance in force remained stable at $294 billion [59] - The in-force premium yield was flat at 38.6 basis points, consistent with expectations [48] - Operating expenses decreased to $53 million from $57 million last quarter and $62 million a year ago, with full-year expenses expected to be at the lower end of the $235 million to $245 million range [31] Market Data and Key Metrics Changes - The delinquency inventory increased by 4% to 24,700 loans, remaining historically low [10] - New delinquency notices rose to 12,300 from 10,600 last quarter, but were still 13% below pre-pandemic levels [10] - The company noted that home prices have remained resilient despite affordability challenges, with a tight supply of homes available for sale [43] Company Strategy and Development Direction - The company is focused on capital management, having redeemed $21 million of junior convertible debentures and paid a $300 million dividend to the holding company [44][45] - The strategy includes concentrating reinsurance coverage on recent or future new insurance written [50] - The company aims to navigate a dynamic economic landscape while maintaining financial strength and flexibility [13] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the housing market's resilience and the potential for long-term mortgage insurance opportunities [43] - The company anticipates an increase in capital return payouts due to improved financial conditions [8] - Management acknowledged the challenges posed by higher interest rates but noted that these rates could positively impact the earnings potential of the investment portfolio in the long term [11] Other Important Information - The company experienced favorable loss reserve development of $48 million, with minimal losses reported this quarter [47][64] - The company has been active in its reinsurance program, including a 30% quota share agreement for policies written in 2024 [67] - The company completed its seventh ILN transaction, providing $330 million of loss protection [87] Q&A Session Summary Question: What is the outlook for capital return? - Management indicated that capital return payouts are expected to increase, with leverage remaining stable [15][52] Question: Can you discuss the pricing environment and competitive dynamics? - Management noted that while the marketplace is competitive, pricing actions taken previously have positioned the company well for good credit quality and returns [94] Question: What are the expectations for new delinquency notices? - Management expects a seasonal increase in new delinquency notices but emphasized that the overall credit environment remains strong compared to pre-pandemic levels [96] Question: How do reinsurance market conditions affect pricing? - Management stated that reinsurance market conditions are improving, which could positively influence pricing and competitiveness in the primary market [98][81]

FORM 10-Q UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2023 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______ to ______ Commission file number 1-10816 MGIC Investment Corporation (Exact name of registrant as specified in its charter) Wisconsin 39-1486475 (State or other ...

MGIC Investment Corporation (NYSE:MTG) Q2 2023 Earnings Call Transcript August 3, 2023 10:00 AM ET Company Participants Dianna Higgins - Head of IR Tim Mattke - CEO Nathan Colson - CFO Conference Call Participants Bose George - KBW Mihir Bhatia - Bank of America Geoffrey Dunn - Dowling & Partners Eric Hagen - BTIG Operator Ladies and gentlemen, thank you for standing by, and welcome to the MGIC Investment Corporation Second Quarter 2023 Earnings Call. [Operator Instructions] I will now turn the conference o ...

FORM 10-Q UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2023 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______ to ______ Commission file number 1-10816 MGIC Investment Corporation (Exact name of registrant as specified in its charter) Wisconsin 39-1486475 (State or other juris ...

Financial Data and Key Metrics Changes - The company reported a net income of $155 million, or $0.53 per share, with an annualized return on equity of 13.3% [10] - Total revenues for the quarter were $284 million, down from $295 million in the same period last year [16] - Net premiums earned decreased to $242 million from $255 million year-over-year, primarily due to a decrease in accelerated single premium cancellations and an increase in ceded premiums [16] - Book value per share increased by 4.7% during the quarter to $16.57, and more than 12% compared to a year ago [17] Business Line Data and Key Metrics Changes - Insurance in force grew by 5.4% year-over-year, ending the quarter at $292 billion, despite lower volumes of new insurance written [5][10] - The company wrote $8 billion of new insurance written (NIW) in the quarter, reflecting a smaller NI origination market [36] - The loss ratio was reported at 3%, with net losses incurred of $6 million compared to negative $19 million in the same quarter last year [15][38] Market Data and Key Metrics Changes - The annual persistency rate increased to 82% from 67% a year ago, indicating improved retention of insurance policies [36] - The company expects its insurance in force portfolio to remain relatively flat this year due to affordability issues and high interest rates affecting home prices [6] Company Strategy and Development Direction - The company is focused on maintaining financial strength and flexibility while executing its business strategies for long-term success [35] - A comprehensive reinsurance program is in place to reduce volatility in losses and provide diversification of capital sources [14] - The company plans to continue advocating for the increased use of private mortgage insurance in housing finance [22] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding the normalization of home prices, which is seen as healthy for the housing market and overall economy [6] - The company remains comfortable with its market position and believes it is well-situated to navigate current uncertainties [48] - Management noted that credit performance remains strong, with delinquency rates at historic lows [12] Other Important Information - The company repurchased 5.8 million shares for $78 million and paid a quarterly dividend of $0.10 per share [13] - A $300 million dividend was paid to the holding company to enhance liquidity and financial flexibility [14] - The company expects operating expenses to be down modestly in 2023, with a full-year guidance range of $235 million to $245 million [44] Q&A Session Summary Question: Does the expense guidance include the $8 million for this year? - Yes, the full-year guidance will include the settlement charges incurred in the first quarter [50] Question: What is the target debt to capital ratio? - The target debt to capital ratio is in the low to mid-teens, currently approximately 12% [52] Question: What changed last year regarding expenses? - Significant pension-related costs and continued investments in infrastructure and analytics contributed to increased expenses [66] Question: Are there specific concerns on the credit side? - Management feels comfortable with the current credit dynamics and borrower characteristics, despite some enhanced risks noted previously [69] Question: How does the company view the reinsurance market? - The reinsurance market remains active, and the company is comfortable transacting within a range of cost bands [94]

Financial Performance - Net premiums written decreased to $230.192 million in Q1 2023 from $242.665 million in Q1 2022, a decline of approximately 5.8%[33] - Net premiums earned were $242.015 million in Q1 2023, down from $255.240 million in Q1 2022, representing a decrease of about 5.2%[33] - Total revenues for Q1 2023 were $283.965 million, down from $294.616 million in Q1 2022, indicating a decrease of about 3.5%[33] - Net income for Q1 2023 was $154.547 million, compared to $175.013 million in Q1 2022, a decline of approximately 11.7%[33] - Basic earnings per share for Q1 2023 were $0.53, down from $0.55 in Q1 2022, a decrease of about 3.6%[33] - Comprehensive income for Q1 2023 was $240,559, compared to a loss of $95,532 in Q1 2022[35] - The net income for the three months ended March 31, 2023, was $154,547,000, compared to $175,013,000 for the same period in 2022, reflecting a decrease of approximately 11.7%[86] - Diluted EPS for Q1 2023 was also $0.53, compared to $0.54 in Q1 2022, showing a decrease of approximately 1.9%[86] Investment Income - Investment income increased to $49.223 million in Q1 2023, compared to $38.262 million in Q1 2022, reflecting a growth of approximately 28.7%[33] - The company reported a change in unrealized investment gains of $80,659 in Q1 2023, compared to a loss of $270,938 in Q1 2022[35] - Net unrealized investment gains for Q1 2023 were $102,099, a significant recovery from losses of $342,960 in Q1 2022[121] - Total other comprehensive income for Q1 2023 was $108,875, compared to a loss of $342,462 in Q1 2022[121] Losses and Expenses - Losses incurred, net, were $6.446 million in Q1 2023, a significant improvement from losses of $19.314 million in Q1 2022[33] - Other underwriting and operating expenses increased to $70.063 million in Q1 2023, compared to $54.732 million in Q1 2022, an increase of about 27.9%[33] - Losses incurred for the current year were $47.212 million, compared to $36.344 million for the same period last year[138] - The favorable loss development for Q1 2023 was $40.8 million, down from $55.7 million in Q1 2022[135] Shareholder Equity and Stock Repurchase - Total shareholders' equity increased to $4,777,644 as of March 31, 2023, up from $4,610,355 a year earlier[37] - The company repurchased $76,151 in common stock during Q1 2023, compared to $123,640 in Q1 2022[39] - The company repurchased 5.8 million shares at an average cost of $13.43 per share in the first three months of 2023[147] - Cash dividends paid in Q1 2023 totaled $29.6 million, with a declared dividend of $0.10 per share[148] Cash Flow and Assets - Net cash provided by operating activities for Q1 2023 was $212,286, down from $228,011 in Q1 2022[39] - Cash and cash equivalents at the end of Q1 2023 were $366,572, compared to $489,897 at the end of Q1 2022[39] - As of March 31, 2023, total fair value of assets is $5,941,364, an increase from $5,752,594 as of December 31, 2022[115] Debt and Compliance - Interest expense decreased to $9.374 million in Q1 2023 from $14.912 million in Q1 2022, a reduction of approximately 37.5%[33] - The company is in compliance with all debt covenants as of March 31, 2023[53] - MGIC's risk-to-capital ratio was 9.7 to 1, significantly below the maximum allowed ratio of 25 to 1[154] - MGIC's policyholder position was $3.7 billion, exceeding the required minimum policyholder position (MPP) of $2.1 billion[154] Regulatory and Statutory Information - Statutory net income for Q1 2023 was $54,612, a decrease of 43.4% from $96,018 in Q1 2022[158] - Statutory policyholders' surplus decreased to $992,075 from $1,319,633 year-over-year, reflecting a decline of 24.8%[158] - The company is subject to dividend restrictions, allowing a maximum payment of the lesser of adjusted statutory net income or 10% of statutory policyholders' surplus[155] - MGIC's financial reporting follows statutory accounting principles prescribed by the State of Wisconsin, which may differ from other states[156]

For the transition period from ______ to ______ Commission file number 1-10816 MGIC Investment Corporation (Exact name of registrant as specified in its charter) Wisconsin 39-1486475 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) 250 E. Kilbourn Avenue Milwaukee, Wisconsin 53202 (Address of principal executive offices) (Zip Code) (414) 347-6480 (Registrant's telephone number, including area code) FORM 10-K UNITED STATES SECURITIES AND EXCHANGE COMMISSION ...

Financial Data and Key Metrics Changes - The company reported GAAP net income of $250 million for Q3 2022, compared to $158 million in the same period last year, representing a 58% increase [18] - Adjusted net operating income was $0.86 per diluted share, an 87% increase from $0.46 per diluted share in Q3 2021 [18] - Insurance in-force increased to over $293 billion, a 9.4% increase year-over-year and a 2.4% increase from Q2 2022 [8] - Book value per share decreased slightly to $15.16 from $15.18 at the end of 2021, but increased from $14.81 a year ago [19] Business Line Data and Key Metrics Changes - The loss ratio was negative 41.7% for the quarter, reflecting favorable loss reserve development [9] - Net premiums earned were $252 million, down from $255 million in the same period last year, primarily due to an increase in ceded premiums [21] - The in-force premium yield was 39.0 basis points, down 0.4 basis points during the quarter [21] Market Data and Key Metrics Changes - The volume of mortgage originations has continued to decline due to rising interest rates, impacting the overall market opportunity for new private mortgage insurance [13] - Persistency increased to approximately 76% at the end of the quarter, up from 72% at the end of Q2 2022 [14] Company Strategy and Development Direction - The company aims to support the housing market by facilitating affordable homeownership [6] - A dynamic capital management strategy is in place, focusing on prudent capital allocation and maintaining a strong capital position [11] - The company has entered into various reinsurance agreements to mitigate losses and enhance returns [12] Management's Comments on Operating Environment and Future Outlook - Management noted that affordability challenges and rising interest rates are putting downward pressure on home prices, but the strong credit quality of recent book years should help reduce claims [15] - The company expects new insurance written volume to remain high by historical standards but below the record levels of the past two years [13] Other Important Information - The company repurchased 6.1 million shares for $84 million and paid a quarterly dividend of $0.10 per share [10][26] - A $400 million dividend was paid from the operating company to the holding company, enhancing liquidity [27] Q&A Session Summary Question: Thoughts on pricing given macro uncertainties and competitor actions - Management emphasized the need to price accordingly in uncertain environments and remains focused on return expectations [34] Question: Expectations for capital returns pace - Management indicated that while share repurchases will continue, they will not all be directed towards that, maintaining a prudent level of liquidity [35] Question: Update on buyback and debt reduction - Management stated they are at their debt-to-capital target and will consider retiring remaining convertible debentures if opportunities arise [39] Question: Future persistency expectations - Management anticipates persistency could trend towards 80% but does not expect it to exceed historical highs [41] Question: Changes in consumer behavior regarding appraisals - Management noted no significant changes in consumer behavior affecting persistency [44] Question: Reduced potential for dividends from the holding company - Management indicated that the uncertain outlook may affect future dividends, with capital needs being evaluated continuously [47] Question: Expense outlook for the next year - Management expects expenses to be at the high end of the previously stated range due to performance-based compensation and other factors [50] Question: Potential for investment yields to exceed 4% - Management indicated that reinvestment rates are currently above 4%, and if conditions remain stable, yields could approach that level in two years [53]

Financial Data and Key Metrics Changes - The company reported a GAAP net income of $249 million for Q2 2022, compared to $153 million in the same period last year, representing a significant increase [11][22] - The annualized return on equity was 21.6%, indicating strong financial performance [11] - Book value per common share decreased from $15.18 at the end of 2021 to $14.97 by June 30, 2022, primarily due to unrealized losses from rising interest rates [23] Business Line Data and Key Metrics Changes - Insurance in force increased to over $287 billion, a 9.5% increase year-over-year and a 3.4% increase from the previous quarter [12] - Net premiums earned rose to $256 million, up from $252 million in the same quarter last year, driven by increased insurance in force [25] - The net premium yield for Q2 was 36.2 basis points, down from 39.4 basis points in the previous quarter and 42.6 basis points a year ago [25] Market Data and Key Metrics Changes - The company noted a decrease in new insurance written due to lower mortgage origination forecasts amid rising interest rates [14] - The delinquency inventory decreased by 12.4% to 26,900 loans, marking the eighth consecutive quarter of decline from the pandemic peak [26] Company Strategy and Development Direction - The company aims to maintain financial strength and flexibility while returning capital to shareholders through stock repurchases and dividends [10][13] - The strategy includes deploying capital for growth while managing risks associated with changing market conditions [13][14] - The company is optimistic about long-term opportunities in the mortgage insurance sector despite current market challenges [16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's positioning despite potential risks from rising inflation and interest rates [37] - The company anticipates that the mortgage insurance business is well-hedged against interest rate changes, with increasing persistency in insurance in force [16][17] - Management highlighted the importance of demographic trends for long-term growth opportunities in the mortgage insurance market [16] Other Important Information - The company repurchased 35 million shares for $513 million and paid $104 million in dividends, reflecting a commitment to returning capital to shareholders [32] - Moody's upgraded the company's senior debt rating to Baa3 and its insurance financial strength rating to A3, citing improved market conditions and strong underwriting discipline [33] Q&A Session Summary Question: Comments on pricing strategy and observations from competitors - Management indicated a selective approach to pricing, focusing on risk-return dynamics and adapting to market conditions [42][43] Question: Share repurchase cadence and debt-to-capital ratio outlook - Management confirmed a target debt-to-capital ratio in the low to mid-teens, with ongoing share repurchase activities funded by dividends from the operating company [45][46] Question: Outlook on premium yields and factors influencing changes - Management noted a slight decline in premium yields but expected the overall trend to be better than initially anticipated [50][52] Question: Reserve activity outlook amid macro conditions - Management indicated that reserve development would depend on ongoing cure activity and market conditions, with a focus on maintaining strong underwriting standards [53][54] Question: Insights on market share and bulk market movements - Management suggested that their market share may have increased slightly, maintaining a consistent range over the past few years [56][57] Question: Credit trends and potential housing market slowdown - Management reported no significant credit concerns but acknowledged the possibility of moderating home price appreciation [64][66] Question: Delinquency trends normalization - Management confirmed that new delinquency notices are below pre-pandemic levels, indicating favorable trends [68] Question: Expense guidance and investment outlook - Management maintained the expense guidance for 2022 while indicating potential for a downward trend in the expense ratio in subsequent years [70][72]