[Cautionary Note Regarding Forward-Looking Statements](index=3&type=section&id=Cautionary%20Note%20Regarding%20Forward-Looking%20Statements) This section cautions that forward-looking statements are estimates of future results, subject to material differences due to various factors, and are not updated after their initial date - Forward-looking statements are estimates of future results, and actual results may differ materially from expectations due to various factors. The company undertakes no obligation to update or revise any forward-looking statement[9](index=9&type=chunk) - Important factors that could cause actual results to differ include changes in general economic, market, and political conditions (e.g., interest rates, inflation, housing market, recession), changes in GSE policies (Fannie Mae and Freddie Mac), ability to meet PMIERs requirements, actions of competitors, new laws/regulations, and potential legal/regulatory claims[9](index=9&type=chunk) - Additional risks include the ability to execute capital plans, market participants seeking alternatives to private mortgage insurance, ability to implement business strategy, failure of risk management, decrease in policy duration, unexpected claims, natural/man-made disasters, counterparty inability to meet obligations, IT system failures, and ability to retain key personnel[12](index=12&type=chunk) PART I [Item 1. Financial Statements](index=5&type=section&id=Item%201.%20Financial%20Statements) This section presents NMI Holdings, Inc.'s unaudited condensed consolidated financial statements for Q2 2025 and FY2024 [Condensed Consolidated Balance Sheets (Unaudited)](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets%20%28Unaudited%29) These balance sheets present the company's financial position, showing increased total assets and shareholders' equity as of June 30, 2025 Condensed Consolidated Balance Sheets (Unaudited) - Key Figures | Metric | June 30, 2025 (In Thousands) | December 31, 2024 (In Thousands) | Change (In Thousands) | % Change | | :--------------------------------- | :----------------------------- | :------------------------------- | :-------------------- | :------- | | Total Assets | $3,591,085 | $3,349,973 | $241,112 | 7.2% | | Total Liabilities | $1,170,978 | $1,132,541 | $38,437 | 3.4% | | Total Shareholders' Equity | $2,420,107 | $2,217,432 | $202,675 | 9.1% | - Fixed maturities, available-for-sale, at fair value increased from **$2.72 billion to $2.93 billion**, a **7.5% increase**[18](index=18&type=chunk) - Cash and cash equivalents increased significantly from **$54.31 million to $84.01 million**, a **54.7% increase**[18](index=18&type=chunk) [Condensed Consolidated Statements of Operations and Comprehensive Income (Unaudited)](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income%20%28Unaudited%29) These statements show increased net income and comprehensive income for Q2 and H1 2025, driven by revenues despite higher claims Condensed Consolidated Statements of Operations and Comprehensive Income (Unaudited) - Key Figures | Metric (In Thousands) | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | % Change (YoY) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | % Change (YoY) | | :-------------------- | :--------------------------- | :--------------------------- | :------------- | :--------------------------- | :--------------------------- | :------------- | | Net premiums earned | $149,066 | $141,168 | 5.6% | $298,432 | $277,825 | 7.4% | | Net investment income | $24,949 | $20,688 | 20.6% | $48,635 | $40,124 | 21.2% | | Total revenues | $173,779 | $162,122 | 7.2% | $347,025 | $318,375 | 9.0% | | Insurance claims and claim expenses | $13,445 | $276 | 4771.4% | $17,923 | $3,970 | 351.5% | | Total expenses | $50,178 | $43,478 | 15.4% | $92,053 | $85,164 | 8.1% | | Net income | $96,151 | $92,079 | 4.4% | $198,710 | $181,129 | 9.7% | | Basic EPS | $1.23 | $1.15 | 7.0% | $2.54 | $2.25 | 12.9% | | Diluted EPS | $1.21 | $1.13 | 7.1% | $2.50 | $2.22 | 12.6% | | Comprehensive income | $117,422 | $90,530 | 29.7% | $250,757 | $169,675 | 47.8% | - Insurance claims and claim expenses significantly increased from **$0.28 million to $13.45 million** for Q2 2025, and from **$3.97 million to $17.92 million** for H1 2025[21](index=21&type=chunk) [Condensed Consolidated Statements of Changes in Shareholders' Equity (Unaudited)](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Shareholders'%20Equity%20%28Unaudited%29) This section details shareholders' equity movements, showing an increase from December 2024 to June 2025, driven by net income Changes in Shareholders' Equity (Unaudited) - Key Figures | Metric (In Thousands) | December 31, 2024 | March 31, 2025 | June 30, 2025 | | :-------------------- | :---------------- | :------------- | :------------ | | Total Shareholders' Equity | $2,217,432 | $2,321,571 | $2,420,107 | | Net Income | - | $102,559 | $96,151 | | Repurchase of common stock | - | $(26,053) | $(23,400) | | Change in unrealized investment gains/losses, net of tax | - | $30,776 | $21,271 | - Total shareholders' equity increased by **$202.68 million** from **$2.22 billion** at December 31, 2024, to **$2.42 billion** at June 30, 2025[23](index=23&type=chunk) - Treasury Stock, at cost, increased from **$(246.59) million to $(296.05) million**, reflecting **$26.05 million** in Q1 2025 and **$23.40 million** in Q2 2025 share repurchases[23](index=23&type=chunk) [Condensed Consolidated Statements of Cash Flows (Unaudited)](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows%20%28Unaudited%29) Cash flow statements show stable operating cash, decreased investing cash use, and increased financing cash use for H1 2025 Condensed Consolidated Statements of Cash Flows (Unaudited) - Key Figures | Cash Flow Activity (In Thousands) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | Change (YoY) | % Change (YoY) | | :-------------------------------- | :--------------------------- | :--------------------------- | :----------- | :------------- | | Net cash provided by operating activities | $229,507 | $229,363 | $144 | 0.1% | | Net cash used in investing activities | $(141,786) | $(212,366) | $70,580 | -33.2% | | Net cash used in financing activities | $(58,016) | $(51,057) | $(6,959) | 13.6% | | Net increase (decrease) in cash, cash equivalents and restricted cash | $29,705 | $(34,060) | $63,765 | -187.2% | | Cash, cash equivalents and restricted cash, end of period | $84,013 | $62,629 | $21,384 | 34.1% | - Net cash used in investing activities decreased by **$70.58 million**, primarily due to lower purchases of fixed-maturity investments and higher proceeds from maturities and sales of investments[27](index=27&type=chunk) - Net cash used in financing activities increased by **$6.96 million**, mainly due to increased repurchases of common stock and taxes paid related to net share settlement of equity awards, partially offset by the absence of debt refinancing activities seen in the prior year[27](index=27&type=chunk) [Notes to Condensed Consolidated Financial Statements (Unaudited)](index=11&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements%20%28Unaudited%29) These notes provide essential details and explanations for the condensed consolidated financial statements, covering key accounting areas [1. Organization, Basis of Presentation and Summary of Accounting Principles](index=11&type=section&id=1.%20Organization%2C%20Basis%20of%20Presentation%20and%20Summary%20of%20Accounting%20Principles) NMIH provides private mortgage insurance through NMIC, operating as a single segment, with no material changes to accounting principles - NMI Holdings, Inc. (NMIH) provides private mortgage guaranty insurance through its wholly-owned insurance subsidiary, National Mortgage Insurance Corporation (NMIC), which is licensed in all 50 states and D.C[28](index=28&type=chunk) - The company operates as a single segment for performance assessment and operating decisions[28](index=28&type=chunk) - NMIH adopted **ASU 2023-09** (Income Taxes) on January 1, 2025, enhancing tax disclosure, and is evaluating **ASU 2024-03** for future adoption[31](index=31&type=chunk)[32](index=32&type=chunk) [2. Investments](index=12&type=section&id=2.%20Investments) All investments are available-for-sale at fair value, with a **$2.9 billion** portfolio and **$109.9 million** gross unrealized losses - All investments are held on an available-for-sale basis at fair value, with impairment recognized through the statement of operations if a sale is intended or likely required, or if credit-related factors are present[33](index=33&type=chunk) Total Investments at Fair Value | Metric | June 30, 2025 (In Thousands) | December 31, 2024 (In Thousands) | Change (In Thousands) | % Change | | :-------------------- | :--------------------------- | :------------------------------- | :-------------------- | :------- | | Total investments | $2,929,117 | $2,723,541 | $205,576 | 7.5% | | Gross Unrealized Gains | $22,992 | $5,820 | $17,172 | 295.0% | | Gross Unrealized Losses | $(109,907) | $(158,622) | $48,715 | -30.7% | - As of June 30, 2025, gross unrealized losses totaled **$109.9 million**, primarily driven by interest rate fluctuations, not credit factors[38](index=38&type=chunk)[41](index=41&type=chunk) Net Investment Income | Metric (In Thousands) | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | % Change (YoY) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | % Change (YoY) | | :-------------------- | :--------------------------- | :--------------------------- | :------------- | :--------------------------- | :--------------------------- | :------------- | | Net investment income | $24,949 | $20,688 | 20.6% | $48,635 | $40,124 | 21.2% | [3. Fair Value of Financial Instruments](index=15&type=section&id=3.%20Fair%20Value%20of%20Financial%20Instruments) The company uses a fair value hierarchy (Level 1, 2, 3) for financial instruments, with most assets in Level 1 or 2 - Fair value measurements are categorized into a three-level hierarchy: Level 1 (quoted prices in active markets), Level 2 (observable inputs other than quoted prices), and Level 3 (unobservable inputs)[44](index=44&type=chunk)[45](index=45&type=chunk)[46](index=46&type=chunk) Fair Value Measurements of Assets (In Thousands) | Asset Type | June 30, 2025 (Level 1) | June 30, 2025 (Level 2) | December 31, 2024 (Level 1) | December 31, 2024 (Level 2) | | :------------------------------------------ | :---------------------- | :---------------------- | :-------------------------- | :-------------------------- | | U.S. Treasury securities and obligations of U.S. government agencies | $0 | $115,988 | $116,060 | $0 | | Municipal debt securities | $634,962 | $0 | $0 | $635,245 | | Corporate debt securities | $2,019,333 | $0 | $0 | $1,847,640 | | Asset-backed securities | $38,557 | $0 | $0 | $41,980 | | Cash, cash equivalents and short-term investments | $0 | $204,290 | $136,924 | $0 | | Total assets | $2,692,852 | $320,278 | $252,984 | $2,524,865 | - The 2024 Senior Unsecured Notes, carried at **$416.1 million**, had a fair value of **$437.2 million** as of June 30, 2025, assessed under Level 2[50](index=50&type=chunk) [4. Debt](index=16&type=section&id=4.%20Debt) The company holds **$425 million** in senior unsecured notes and a **$250 million** undrawn credit facility, complying with covenants - NMIH has **$425 million** in senior unsecured notes outstanding, issued May 21, 2024, with a **6.00% interest rate** maturing August 15, 2029[51](index=51&type=chunk)[52](index=52&type=chunk) - A new **$250 million** unsecured revolving credit facility, maturing May 21, 2029, was undrawn as of June 30, 2025[56](index=56&type=chunk) - The company complied with all 2024 Revolving Credit Facility covenants at June 30, 2025, including a maximum **35% debt-to-total capitalization ratio**[59](index=59&type=chunk) [5. Reinsurance](index=17&type=section&id=5.%20Reinsurance) Reinsurance, including QSR, XOL, and ILN, is used for risk management, PMIERs compliance, and business growth, with recent QSR terminations and new XOL treaties - Reinsurance is used to manage risk, ensure PMIERs compliance, meet state regulatory capital requirements, and support business growth, with all transactions approved by the Wisconsin OCI and non-objected by the GSEs[60](index=60&type=chunk) Effect of Reinsurance on Premiums (In Thousands) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | % Change (YoY) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | % Change (YoY) | | :-------------------- | :--------------------------- | :--------------------------- | :------------- | :--------------------------- | :--------------------------- | :------------- | | Net premiums written | $144,053 | $133,814 | 7.6% | $287,439 | $264,059 | 8.9% | | Net premiums earned | $149,066 | $141,168 | 5.6% | $298,432 | $277,825 | 7.4% | | Ceded premiums earned | $(33,865) | $(32,465) | 4.3% | $(64,955) | $(65,526) | -0.9% | - Effective April 1, 2025, NMIC terminated most 2016 and 2018 QSR transactions, recapturing approximately **$180.1 million** and **$59.7 million** of ceded risk-in-force[71](index=71&type=chunk)[72](index=72&type=chunk) - NMIC entered into new XOL treaties for 2026 and 2027, providing aggregate coverage for future mortgage insurance policies[74](index=74&type=chunk)[89](index=89&type=chunk)[90](index=90&type=chunk) [6. Reserves for Insurance Claims and Claim Expenses](index=23&type=section&id=6.%20Reserves%20for%20Insurance%20Claims%20and%20Claim%20Expenses) Gross reserves for insurance claims totaled **$163.0 million** at June 30, 2025, with a **1.00% default rate** on 668,638 policies - As of June 30, 2025, gross reserves for insurance claims and claim expenses totaled **$163.0 million**[102](index=102&type=chunk) Loans in Default and Default Rate | Metric | June 30, 2025 | December 31, 2024 | | :-------------------- | :------------ | :---------------- | | Loans in default | 6,709 | 6,642 | | Total policies in-force | 668,638 | 659,567 | | Default rate | 1.00% | 1.01% | Reconciliation of Gross Reserve Balances (In Thousands) | Metric | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :--------------------------------- | :--------------------------- | :--------------------------- | | Beginning balance | $152,071 | $123,974 | | Total claims and claim expenses incurred | $17,590 | $3,970 | | Total claims and claim expenses paid | $7,073 | $2,323 | | Ending balance | $163,033 | $125,443 | - Claims incurred relating to current year defaults increased during the six months ended June 30, 2025, primarily due to an increase in new delinquencies tied to portfolio growth and seasoning, partially offset by a decrease in average case reserve per newly defaulted loan[109](index=109&type=chunk) [7. Earnings per Share (EPS)](index=25&type=section&id=7.%20Earnings%20per%20Share%20%28EPS%29) The basic and diluted EPS for the three and six months ended June 30, 2025, increased compared to the prior year, reflecting higher net income Earnings per Share (EPS) | Metric | 3 Months Ended June 30, 2025 (USD) | 3 Months Ended June 30, 2024 (USD) | % Change (YoY) | 6 Months Ended June 30, 2025 (USD) | 6 Months Ended June 30, 2024 (USD) | % Change (YoY) | | :-------------------- | :--------------------------- | :--------------------------- | :------------- | :--------------------------- | :--------------------------- | :------------- | | Basic EPS | $1.23 | $1.15 | 7.0% | $2.54 | $2.25 | 12.9% | | Diluted EPS | $1.21 | $1.13 | 7.1% | $2.50 | $2.22 | 12.6% | [8. Segment Reporting](index=25&type=section&id=8.%20Segment%20Reporting) The company operates as a single Mortgage Insurance segment, with the CEO evaluating performance based on consolidated results - The company manages its business activities on a consolidated basis under a single reportable operating segment: Mortgage Insurance, which also provides ancillary loan review services[112](index=112&type=chunk)[113](index=113&type=chunk) - The CODM evaluates performance and allocates resources based on consolidated financial results, including revenue, expenses, net income, assets, and shareholders' equity[113](index=113&type=chunk) [9. Income Taxes](index=25&type=section&id=9.%20Income%20Taxes) The effective tax rate for Q2 and H1 2025 was **22.2%** and **22.1%**, respectively, reflecting changes in deferred tax liability Effective Tax Rate on Pre-Tax Income | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :-------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Effective tax rate | 22.2% | 22.4% | 22.1% | 22.3% | - The company is eligible for a tax deduction for its statutory contingency reserve, holding **$322.2 million** in tax and loss bonds[118](index=118&type=chunk) - New tax reform legislation (One Big Beautiful Bill Act) enacted on July 4, 2025, is not expected to have a material impact on the consolidated financial statements[119](index=119&type=chunk) [10. Stockholders' Equity](index=26&type=section&id=10.%20Stockholders'%20Equity) The Board authorized a new **$250 million** share repurchase program in February 2025; **$281.0 million** repurchase authority remains available - On February 5, 2025, the Board authorized a new **$250 million** 2025 Repurchase Program (effective through December 31, 2027) and extended the **$200 million** 2023 Repurchase Program to align its tenor[120](index=120&type=chunk) Share Repurchase Activity | Metric | 6 Months Ended June 30, 2025 | | :-------------------- | :--------------------------- | | Shares repurchased | 1.3 million | | Average price per share | $36.49 | | Total cost | $49.5 million | | Repurchase authority remaining | $281.0 million | [11. Litigation](index=26&type=section&id=11.%20Litigation) Litigation regarding mortgage insurance premium refunds was dismissed in September 2023 and affirmed in June 2025, with no material loss expected - A litigation case concerning mortgage insurance premium refunds under the Homeowners Protection Act (HPA) was dismissed in September 2023, and the dismissal was affirmed on appeal in June 2025[123](index=123&type=chunk) - The company does not currently expect to incur a material loss in connection with the case and has not recorded a litigation liability[123](index=123&type=chunk) [12. Premiums Receivable, Net](index=26&type=section&id=12.%20Premiums%20Receivable%2C%20Net) Premiums receivable are written off after 120 days, with a **$1.6 million** reserve for write-offs at June 30, 2025 - Premiums receivable are written off if unpaid for more than 120 days, or earlier for non-credit events like loan modification or refinancing[124](index=124&type=chunk) Reserve for Premium Write-Offs (In Thousands) | Metric | June 30, 2025 | December 31, 2024 | | :-------------------- | :------------ | :---------------- | | Reserve for premium write-offs | $1,600 | $2,200 | - The allowance for credit loss established on premium receivables was deemed immaterial at June 30, 2025, and December 31, 2024, due to the nature and short duration of the receivables[125](index=125&type=chunk) [13. Regulatory Information](index=27&type=section&id=13.%20Regulatory%20Information) NMIC's statutory capital was **$3.0 billion** with a **13.1:1 RTC ratio** at June 30, 2025, after paying a **$98.4 million** dividend Statutory Financials (In Thousands) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :-------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Combined statutory net income | $30,500 | $36,000 | $67,300 | $70,700 | NMIC Statutory Capital and Risk-to-Capital Ratio (In Thousands) | Metric | June 30, 2025 | December 31, 2024 | | :-------------------- | :------------ | :---------------- | | Statutory surplus | $951,592 | $984,362 | | Contingency reserve | $2,076,510 | $1,905,990 | | Statutory capital | $3,028,102 | $2,890,352 | | Risk-to-capital | 13.1:1 | 12.7:1 | - NMIC paid a **$98.4 million** ordinary dividend to NMIH on June 2, 2025, exhausting its 2025 ordinary dividend capacity[132](index=132&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=28&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section discusses NMI Holdings, Inc.'s financial condition and results, covering business overview, key factors, and performance analysis [Overview](index=28&type=section&id=Overview) NMIH provides private mortgage insurance through NMIC, mitigating mortgage credit risk and focusing on disciplined risk selection - NMIH provides private mortgage insurance (MI) through NMIC, which is approved by GSEs and licensed in all 50 states and D.C[134](index=134&type=chunk) - MI mitigates mortgage credit risk and facilitates secondary market sales of high-LTV residential loans to GSEs, expanding financing access for homeowners[135](index=135&type=chunk) Primary Insurance-in-Force (IIF) and Risk-in-Force (RIF) | Metric | June 30, 2025 (In Billions) | | :-------------------- | :------------ | | Primary IIF | $214.7 | | Primary RIF | $57.5 | - The company's strategy focuses on long-term customer relationships, disciplined risk selection using **Rate GPS®**, and financial strength[137](index=137&type=chunk) [Conditions and Trends Affecting Our Business](index=29&type=section&id=Conditions%20and%20Trends%20Affecting%20Our%20Business) Macroeconomic factors like inflation and high interest rates are expected to impact the housing market, reducing new business and increasing claims - Macroeconomic factors, including persistent inflation, elevated interest rates, flagging consumer confidence, and increasing jobless claims, could significantly impact the housing market and mortgage insurance industry[140](index=140&type=chunk) - A decline in housing demand, a significant decrease in house prices, or a sustained increase in unemployment could reduce new insurance written (NIW) volume and increase future default and claim experience[140](index=140&type=chunk) [Key Factors Affecting Our Results](index=29&type=section&id=Key%20Factors%20Affecting%20Our%20Results) This section details critical operational and financial metrics influencing performance, including NIW, IIF, RIF, premiums, and claims [New Insurance Written, Insurance-In-Force and Risk-In-Force](index=29&type=section&id=New%20Insurance%20Written%2C%20Insurance-In-Force%20and%20Risk-In-Force) New Insurance Written (NIW) is influenced by the overall mortgage origination market and the company's market share. NIW, along with persistency, drives Insurance-In-Force (IIF), which in turn determines Risk-In-Force (RIF) - New Insurance Written (NIW) is the aggregate unpaid principal balance of mortgages underpinning new policies and is affected by the overall mortgage origination market, high-LTV originations, and the company's private MI market share[141](index=141&type=chunk) - Insurance-In-Force (IIF) is the aggregate unpaid principal balance of insured mortgages, while Risk-In-Force (RIF) represents the aggregate coverage amount on outstanding policies, calculated as the coverage percentage applied to the unpaid principal balance[141](index=141&type=chunk) [Net Premiums Written and Net Premiums Earned](index=29&type=section&id=Net%20Premiums%20Written%20and%20Net%20Premiums%20Earned) Premium rates are set using **Rate GPS®**, with net premiums influenced by NIW, rates, cancellations, and reinsurance, impacting profitability - Premium rates are set using a proprietary risk-based pricing platform, **Rate GPS®**, which considers various individual variables to price policies commensurate with underlying risk[142](index=142&type=chunk) - Net premiums written are influenced by NIW, premium rates, mix of payment types (single, monthly, annual), policy cancellation rates (affected by interest rates, refinancings, home prices), and ceded premiums under reinsurance[142](index=142&type=chunk)[144](index=144&type=chunk) - Higher persistency rates significantly impact net premiums earned and profitability, as premiums are earned over the life of a policy. Prepayment speeds also affect profitability, especially for single premium policies[146](index=146&type=chunk) [Effect of Reinsurance on Our Results](index=30&type=section&id=Effect%20of%20Reinsurance%20on%20Our%20Results) Reinsurance (quota share, excess-of-loss) manages risk, ensures PMIERs compliance, and supports growth by reducing premiums and RIF - Third-party reinsurance (quota share and excess-of-loss) is utilized for risk management, PMIERs compliance, capital requirements, and business growth[147](index=147&type=chunk) - Quota share reinsurance reduces premiums written/earned and RIF, provides capital relief, and offsets acquisition/underwriting expenses through ceding commissions and profit commissions[147](index=147&type=chunk) - Excess-of-loss agreements provide coverage above an agreed-upon threshold, with the ceding insurer retaining losses up to that threshold[147](index=147&type=chunk) [Portfolio Data](index=30&type=section&id=Portfolio%20Data) NIW for Q2 and H1 2025 was **$12.5 billion** and **$21.7 billion**, respectively, with primary IIF growing **5%** to **$214.7 billion** New Insurance Written (NIW) and Primary Insurance-In-Force (IIF) (In Millions) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | % Change (YoY) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | % Change (YoY) | | :-------------------- | :--------------------------- | :--------------------------- | :------------- | :--------------------------- | :--------------------------- | :------------- | | NIW | $12,464 | $12,503 | -0.3% | $21,685 | $21,901 | -1.0% | | Primary IIF (end of period) | $214,653 | $203,501 | 5.5% | $214,653 | $203,501 | 5.5% | - Primary IIF increased **5%** at June 30, 2025, compared to June 30, 2024, primarily due to NIW generated and a historically high persistency rate of **84.1%** (down from 85.4% YoY) due to a slowdown in mortgage refinancing[151](index=151&type=chunk) [Portfolio Statistics](index=31&type=section&id=Portfolio%20Statistics) The primary portfolio shows consistent NIW, growing IIF and RIF, and a **1.00% default rate** at June 30, 2025 Primary Portfolio Trends (As of June 30, 2025) | Metric | June 30, 2025 (In Millions) | June 30, 2024 (In Millions) | | :-------------------- | :------------ | :------------ | | New insurance written | $12,464 | $12,503 | | Insurance-in-force | $214,653 | $203,501 | | Risk-in-force | $57,496 | $53,956 | | Policies in force (count) | 668,638 | 645,276 | | Loans in default (count) | 6,709 | 4,904 | | Default rate | 1.00% | 0.76% | | Annual persistency | 84.1% | 85.4% | NIW by FICO and LTV (6 Months Ended June 30, 2025) | NIW by FICO (In Millions) | 2025 | 2024 | NIW by LTV (In Millions) | 2025 | 2024 | | :------------------------ | :--- | :--- | :----------------------- | :--- | :--- | | >= 760 | $11,494 | $11,685 | 95.01% and above | $2,691 | $2,830 | | 740-759 | $4,034 | $3,951 | 90.01% to 95.00% | $9,760 | $10,059 | | 720-739 | $2,762 | $2,757 | 85.01% to 90.00% | $6,638 | $6,670 | | 700-719 | $1,726 | $1,864 | 85.00% and below | $2,596 | $2,342 | | 680-699 | $1,003 | $1,165 | Total | $21,685 | $21,901 | | <=679 | $666 | $479 | | | | | Total | $21,685 | $21,901 | | | | | Weighted average FICO | 757 | 757 | Weighted average LTV | 92.1% | 92.3% | - The top 3 states for primary RIF as of June 30, 2025, were California (**10.1%**), Texas (**8.4%**), and Florida (**7.2%**), collectively accounting for **25.7%** of the portfolio[169](index=169&type=chunk) [Insurance Claims and Claim Expenses](index=35&type=section&id=Insurance%20Claims%20and%20Claim%20Expenses) Insurance claims and expenses increased due to new defaults and higher case reserves, with ending default inventory at **6,709 loans** - Insurance claims and claim expenses incurred increased due to a rise in newly defaulted loans and higher average case reserves for aging delinquencies, partially offset by reserve releases from cure activity[207](index=207&type=chunk) Loans in Default Reconciliation | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :-------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Beginning default inventory | 6,859 | 5,109 | 6,642 | 5,099 | | New defaults | 2,169 | 1,728 | 4,590 | 3,604 | | Cures | (2,215) | (1,869) | (4,309) | (3,686) | | Claims paid | (93) | (59) | (188) | (101) | | Ending default inventory | 6,709 | 4,904 | 6,709 | 4,904 | Claims Paid and Severity (Before Reinsurance) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :-------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Number of claims paid | 93 | 59 | 188 | 101 | | Total amount paid for claims (In Thousands) | $5,512 | $1,877 | $10,737 | $3,022 | | Average amount paid per claim (In Thousands) | $59 | $32 | $57 | $30 | | Severity | 82% | 54% | 75% | 54% | - Claims severity increased for Q2 and H1 2025, primarily due to claims on newer vintage loans with less accumulated equity[187](index=187&type=chunk) [GSE Oversight](index=39&type=section&id=GSE%20Oversight) NMIC complies with PMIERs, with available assets increasing to **$3.2 billion** and net risk-based required assets to **$1.9 billion** - NMIC must comply with **PMIERs**, maintaining available assets exceeding minimum required assets (greater of **$400 million** or total risk-based amount)[192](index=192&type=chunk)[193](index=193&type=chunk) - NMIC certified full compliance with PMIERs as of December 31, 2024, and continuously monitors compliance[196](index=196&type=chunk) PMIERs Available Assets and Net Risk-Based Required Assets (In Thousands) | Metric | June 30, 2025 | June 30, 2024 | Change (YoY) | % Change (YoY) | | :-------------------- | :------------ | :------------ | :----------- | :------------- | | Available assets | $3,244,517 | $2,827,721 | $416,796 | 14.7% | | Net risk-based required assets | $1,926,517 | $1,651,569 | $274,948 | 16.7% | [Information and Technology Support Function](index=40&type=section&id=Information%20and%20Technology%20Support%20Function) The company renewed its IT service agreement with **TCS** through March 31, 2032, for application development and infrastructure support - The IT service agreement with Tata Consultancy Services (TCS) was renewed and extended through March 31, 2032, covering application development, infrastructure support, and information security[199](index=199&type=chunk) - The engagement with TCS aims to enhance innovative IT solutions and realize cost efficiencies through TCS's global platform[199](index=199&type=chunk) [Consolidated Results of Operations](index=41&type=section&id=Consolidated%20Results%20of%20Operations) Consolidated results show increased total revenues and net income for Q2 and H1 2025, driven by premiums and investment income [Revenues](index=42&type=section&id=Revenues) Total revenues increased by **7%** (Q2) and **9%** (H1) for June 30, 2025, driven by net premiums and investment income Revenue Performance (In Thousands) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | % Change (YoY) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | % Change (YoY) | | :-------------------- | :--------------------------- | :--------------------------- | :------------- | :--------------------------- | :--------------------------- | :------------- | | Net premiums earned | $149,066 | $141,168 | 5.6% | $298,432 | $277,825 | 7.4% | | Net investment income | $24,949 | $20,688 | 20.6% | $48,635 | $40,124 | 21.2% | | Other revenues | $164 | $266 | -38.4% | $334 | $426 | -21.6% | | Total revenues | $173,779 | $162,122 | 7.2% | $347,025 | $318,375 | 9.0% | - Net premiums earned increased primarily due to growth in monthly IIF and monthly pay premium receipts, partially offset by increased ceded premiums under reinsurance treaties[203](index=203&type=chunk) - Net investment income increased due to growth in the total invested asset base and an increase in the book yield of the investment portfolio from new cash flows and reinvestment at higher rates[204](index=204&type=chunk) [Expenses](index=43&type=section&id=Expenses) Total expenses increased by **15%** (Q2) and **8%** (H1) for June 30, 2025, driven by higher claims and operating expenses Expense Performance (In Thousands) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | % Change (YoY) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | % Change (YoY) | | :-------------------- | :--------------------------- | :--------------------------- | :------------- | :--------------------------- | :--------------------------- | :------------- | | Insurance claims and claim expenses | $13,445 | $276 | 4771.4% | $17,923 | $3,970 | 351.5% | | Underwriting and operating expenses | $29,508 | $28,330 | 4.2% | $59,683 | $58,145 | 2.6% | | Service expenses | $110 | $194 | -43.3% | $226 | $331 | -31.7% | | Interest expense | $7,115 | $14,678 | -51.5% | $14,221 | $22,718 | -37.5% | | Total expenses | $50,178 | $43,478 | 15.4% | $92,053 | $85,164 | 8.1% | - Insurance claims and claim expenses increased significantly due to a rise in newly defaulted loans and higher average case reserves for aging delinquencies, partially offset by reserve releases from cure activity[207](index=207&type=chunk) - Interest expense decreased due to the refinancing of the 2020 Notes and 2021 Revolving Credit Facility in the prior year, which included **$7.0 million** of non-recurring costs[210](index=210&type=chunk) [Net Income](index=43&type=section&id=Net%20Income) Net income increased by **4%** (Q2) and **10%** (H1) for June 30, 2025, driven by revenue growth and share repurchases Net Income and EPS Performance (In Thousands, except per share data) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | % Change (YoY) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | % Change (YoY) | | :-------------------- | :--------------------------- | :--------------------------- | :------------- | :--------------------------- | :--------------------------- | :------------- | | Net income | $96,151 | $92,079 | 4.4% | $198,710 | $181,129 | 9.7% | | Diluted EPS | $1.21 | $1.13 | 7.1% | $2.50 | $2.22 | 12.6% | | Adjusted diluted EPS | $1.22 | $1.20 | 1.7% | $2.50 | $2.28 | 9.6% | - Net income growth was primarily driven by increased total revenues, partially offset by higher insurance claims and claim expenses, income tax expense, and underwriting and operating expenses[211](index=211&type=chunk) - Diluted and adjusted diluted EPS increased due to net income growth and a decline in weighted average diluted shares outstanding from share repurchase activity[212](index=212&type=chunk) [Explanation and Reconciliation of Our Use of Non-GAAP Financial Measures](index=45&type=section&id=Explanation%20and%20Reconciliation%20of%20Our%20Use%20of%20Non-GAAP%20Financial%20Measures) This section defines and reconciles non-GAAP financial measures (adjusted income, net income, diluted EPS) to GAAP, excluding specific items - Non-GAAP measures (adjusted income before tax, adjusted net income, adjusted diluted EPS) are used to enhance comparability of fundamental financial performance by excluding net realized investment gains/losses and capital markets transaction costs[217](index=217&type=chunk)[218](index=218&type=chunk)[219](index=219&type=chunk)[220](index=220&type=chunk) Non-GAAP Financial Measure Reconciliations (In Thousands, except per share data) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :-------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Income before income taxes (GAAP) | $123,601 | $118,644 | $254,972 | $233,211 | | Adjustments: Net realized investment losses | $400 | $0 | $376 | $0 | | Adjustments: Capital markets transaction costs | $0 | $6,966 | $0 | $6,966 | | Adjusted income before tax | $124,001 | $125,610 | $255,348 | $240,177 | | Adjusted net income | $96,467 | $97,582 | $199,007 | $186,632 | | Adjusted diluted EPS | $1.22 | $1.20 | $2.50 | $2.28 | [Consolidated Balance Sheets](index=46&type=section&id=Consolidated%20Balance%20Sheets) Total assets increased **7%** to **$3.59 billion**, liabilities **3%** to **$1.17 billion**, and equity **9%** to **$2.42 billion** at June 30, 2025 Consolidated Balance Sheets - Key Changes (In Thousands) | Metric | June 30, 2025 | December 31, 2024 | $ Change | % Change | | :--------------------------------- | :------------ | :---------------- | :------- | :------- | | Total investment portfolio | $2,929,117 | $2,723,541 | $205,576 | 8% | | Cash and cash equivalents | $84,013 | $54,308 | $29,705 | 55% | | Total assets | $3,591,085 | $3,349,973 | $241,112 | 7% | | Unearned premiums | $54,159 | $65,217 | $(11,058) | -17% | | Reserve for insurance claims and claim expenses | $163,033 | $152,071 | $10,962 | 7% | | Deferred tax liability, net | $441,389 | $386,192 | $55,197 | 14% | | Total liabilities | $1,170,978 | $1,132,541 | $38,437 | 3% | | Total shareholders' equity | $2,420,107 | $2,217,432 | $202,675 | 9% | - Total cash and investments increased due to positive cash flow from operations and a decrease in unrealized losses on the fixed income portfolio, partially offset by share repurchase activity[223](index=223&type=chunk) - Unearned premiums decreased due to amortization and cancellations of single premium policies, partially offset by new originations[228](index=228&type=chunk) [Consolidated Cash Flows](index=47&type=section&id=Consolidated%20Cash%20Flows) Operating cash flow was stable at **$229.5 million** (H1 2025); investing cash use decreased **33%**, financing cash use increased **14%** Consolidated Cash Flows - Key Changes (In Thousands) | Metric | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | $ Change | % Change | | :--------------------------------- | :--------------------------- | :--------------------------- | :------- | :------- | | Net cash provided by operating activities | $229,507 | $229,363 | $144 | 0% | | Net cash used in investing activities | $(141,786) | $(212,366) | $70,580 | -33% | | Net cash used in financing activities | $(58,016) | $(51,057) | $(6,959) | 14% | | Net increase (decrease) in cash and cash equivalents | $29,705 | $(34,060) | $63,765 | -187% | - Cash used in investing activities decreased due to lower purchases of fixed and short-term maturities and higher proceeds from maturities, sales, and redemptions within the investment portfolio[232](index=232&type=chunk) - Cash used in financing activities increased primarily due to common stock repurchases and taxes paid on net share settlement of equity awards, with the prior year benefiting from debt refinancing proceeds[233](index=233&type=chunk) [Liquidity and Capital Resources](index=47&type=section&id=Liquidity%20and%20Capital%20Resources) NMIH manages liquidity with **$168.8 million** cash and a **$250 million** credit facility; NMIC paid a **$98.4 million** dividend and maintains PMIERs compliance - NMIH's principal liquidity demands include corporate expenses, debt interest, tax payments, subsidiary capital support, stock repurchases, and dividends[234](index=234&type=chunk) - As of June 30, 2025, NMIH had **$168.8 million** in cash and investments and access to a **$250 million** undrawn revolving credit facility[235](index=235&type=chunk) - NMIC paid a **$98.4 million** ordinary dividend to NMIH on June 2, 2025, exhausting its 2025 ordinary dividend capacity[243](index=243&type=chunk) - NMIC maintains PMIERs compliance with **$3.2 billion** in available assets, **$1.9 billion** in required assets, and a **13.1:1 RTC ratio**[197](index=197&type=chunk)[251](index=251&type=chunk) [Debt and Financial Strength Ratings](index=49&type=section&id=Debt%20and%20Financial%20Strength%20Ratings) NMIC holds financial strength ratings of **A- (Fitch), A3 (Moody's), A- (S&P)**; NMIH's 2024 Notes are rated **BBB- (Fitch), Baa3 (Moody's)** Financial Strength and Debt Ratings | Entity | Rating Type | Fitch | Moody's | S&P | Outlook (Fitch) | Outlook (Moody's & S&P) | | :----- | :---------- | :---- | :------ | :-- | :-------------- | :---------------------- | | NMIC | Financial Strength | A- | A3 | A- | Positive | Stable | | NMIH | 2024 Notes | BBB- | Baa3 | N/A | Positive | Stable | [Consolidated Investment Portfolio](index=49&type=section&id=Consolidated%20Investment%20Portfolio) The **$2.9 billion** fixed maturity investment portfolio aims for income and capital preservation, with a **3.2%** pre-tax book yield - The investment portfolio's primary objectives are to generate investment income and preserve capital, while maintaining sufficient liquidity, with diversification by type, quality, maturity, and industry[254](index=254&type=chunk) Investment Portfolio Composition (Fair Value) | Investment Type | June 30, 2025 | December 31, 2024 | | :------------------------------------------ | :------------ | :---------------- | | Corporate debt securities | 67% | 67% | | Municipal debt securities | 21% | 23% | | Cash, cash equivalents, and short-term investments | 7% | 5% | | U.S. treasury securities and obligations of U.S. government agencies | 4% | 4% | | Asset-backed securities | 1% | 1% | | Total | 100% | 100% | - Pre-tax book yield on the investment portfolio for H1 2025 was **3.2%**[255](index=255&type=chunk) - Gross unrealized losses of **$109.9 million** as of June 30, 2025, were primarily due to interest rate fluctuations[259](index=259&type=chunk)[260](index=260&type=chunk) [Critical Accounting Estimates](index=50&type=section&id=Critical%20Accounting%20Estimates) Critical accounting estimates include revenue recognition, investments, deferred policy acquisition costs, and insurance claims reserves, with no material changes - Critical accounting estimates include revenue recognition, the investment portfolio, deferred policy acquisition costs, and reserves for insurance claims and claim expenses, which require significant judgment and material estimates[262](index=262&type=chunk) - There have been no material changes to the critical accounting policies and estimates compared to the 2024 10-K[262](index=262&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=52&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The investment portfolio faces interest rate risk, managed by duration matching; fixed income portfolio duration was **3.52 years** at June 30, 2025 - The primary market risk to the investment portfolio is interest rate risk, mitigated by matching the duration of fixed maturity securities with the expected duration of liabilities[264](index=264&type=chunk) - As of June 30, 2025, the fixed income portfolio's duration was **3.52 years**, implying a **3.52%** fair value change for a 100 basis point yield shift[265](index=265&type=chunk) - The 2024 Revolving Credit Facility bears interest at a variable rate, and ILN Transactions' risk premiums are linked to one-month SOFR, exposing the company to interest rate fluctuations[266](index=266&type=chunk)[267](index=267&type=chunk) [Item 4. Controls and Procedures](index=53&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal controls - Management, including the CEO and CFO, concluded that disclosure controls and procedures were effective as of June 30, 2025, ensuring timely and accurate reporting under the Exchange Act[271](index=271&type=chunk) - There was no change in internal control over financial reporting during the period that materially affected, or is reasonably likely to materially affect, the company's internal control over financial reporting[272](index=272&type=chunk) PART II [Item 1. Legal Proceedings](index=54&type=section&id=Item%201.%20Legal%20Proceedings) Litigation regarding mortgage insurance premium refunds was dismissed in September 2023 and affirmed in June 2025, with no material loss expected - A litigation case concerning mortgage insurance premium refunds under the Homeowners Protection Act (HPA) was dismissed by the District Court in September 2023, and this dismissal was affirmed by the Fourth Circuit in June 2025[277](index=277&type=chunk) - The company has not recognized a material accrual liability for this matter and does not currently expect it is reasonably possible that these matters will result in a material liability[277](index=277&type=chunk) [Item 1A. Risk Factors](index=54&type=section&id=Item%201A.%20Risk%20Factors) This section refers to the 2024 10-K for risk factors, noting no material changes as of this report's date - Risk factors affecting the business and financial results are discussed in Part I, Item 1A of the 2024 10-K[278](index=278&type=chunk) - As of the date of this report, the company is not aware of any material changes in its risk factors from those disclosed in the 2024 10-K[278](index=278&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=55&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company repurchased **627,911 shares** for Q2 2025; **$281.0 million** repurchase authority remains as of June 30, 2025 Issuer Purchases of Equity Securities (3 Months Ended June 30, 2025) | Period | Total Number of Shares Purchased | Average Price Paid per Share (USD) | Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans or Program (In Thousands) | | :-------------------- | :------------------------------- | :--------------------------- | :------------------------------------------------------------------------------------------- | | 4/1/2025 to 4/30/2025 | 258,814 | $33.90 | $295,418 | | 5/1/2025 to 5/31/2025 | 198,180 | $37.84 | $287,919 | | 6/1/2025 to 6/30/2025 | 170,917 | $40.37 | $281,019 | | Total | 627,911 | | | - As of June 30, 2025, **$281.0 million** of repurchase authority remained under the 2023 and 2025 Repurchase Programs[280](index=280&type=chunk) [Item 5. Other Information](index=55&type=section&id=Item%205.%20Other%20Information) No Section 16 officers or directors adopted, modified, or terminated "Rule 10b5-1 trading arrangements" or "non-Rule 10b5-1 trading arrangements" during the quarter ended June 30, 2025 - No Section 16 officers or directors adopted, modified, or terminated Rule 10b5-1 trading arrangements or non-Rule 10b5-1 trading arrangements during the quarter ended June 30, 2025[281](index=281&type=chunk) [Item 6. Exhibits](index=56&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including agreements, corporate documents, and certifications - The exhibits include the Underwriting Agreement, Amended and Restated Certificate of Incorporation and Bylaws, Indenture for Senior Unsecured Notes, various Stock Incentive Plan agreements, Indemnification Agreement, Severance Benefit Plans, Offer Letters, and certifications (302 and 906)[282](index=282&type=chunk)[283](index=283&type=chunk) - Financial information formatted in XBRL (eXtensible Business Reporting Language) is included as Exhibit 101[285](index=285&type=chunk) [Signatures](index=59&type=section&id=Signatures) The report is signed by Aurora Swithenbank, Chief Financial Officer and Duly Authorized Signatory, on behalf of NMI Holdings, Inc. on July 29, 2025 - The Form 10-Q was signed by Aurora Swithenbank, Chief Financial Officer and Duly Authorized Signatory, on July 29, 2025[289](index=289&type=chunk)

[Second Quarter 2025 Financial Results Overview](index=1&type=section&id=1.%20Second%20Quarter%202025%20Financial%20Results%20Overview) NMI Holdings, Inc. reported strong Q2 2025 financial results, including net income of **$96.2 million** and continued growth in its insured portfolio [Executive Summary](index=1&type=section&id=1.1.%20Executive%20Summary) NMI Holdings, Inc. reported Q2 2025 net income of **$96.2 million** and adjusted net income of **$96.5 million**, with the CEO emphasizing strong operating performance and portfolio growth - NMI Holdings, Inc. reported net income of **$96.2 million**, or **$1.21 per diluted share**, for the second quarter ended June 30, 2025[2](index=2&type=chunk) - Adjusted net income for the quarter was **$96.5 million**, or **$1.22 per diluted share**[2](index=2&type=chunk) - CEO Adam Pollitzer highlighted strong operating performance, continued growth in the high-quality insured portfolio, and standout financial results[3](index=3&type=chunk) [Selected Financial and Operational Highlights](index=1&type=section&id=1.2.%20Selected%20Financial%20and%20Operational%20Highlights) Q2 2025 highlights include year-over-year growth in primary insurance-in-force and total revenue, alongside a significant increase in insurance claims and a higher loss ratio Selected Q2 2025 Financial and Operational Highlights | Metric | Q2 2025 | Q1 2025 | Q2 2024 | Q/Q Change | Y/Y Change | | :--------------------------------- | :-------- | :-------- | :-------- | :--------- | :--------- | | Primary Insurance-in-Force ($B) | $214.7 | $211.3 | $203.5 | 2 % | 5 % | | Net Premiums Earned ($M) | $149.1 | $149.4 | $141.2 | — % | 6 % | | Total Revenue ($M) | $173.8 | $173.2 | $162.1 | — % | 7 % | | Insurance Claims & Claim Expenses ($M) | $13.4 | $4.5 | $0.3 | 200 % | (3) NM | | Loss Ratio | 9.0 % | 3.0 % | 0.2 % | | | | Underwriting & Operating Expenses ($M) | $29.5 | $30.2 | $28.3 | (2)% | 4 % | | Expense Ratio | 19.8 % | 20.2 % | 20.1 % | | | | Net Income ($M) | $96.2 | $102.6 | $92.1 | (6)% | 4 % | | Diluted EPS | $1.21 | $1.28 | $1.13 | (5)% | 7 % | | Adjusted Net Income ($M) | $96.5 | $102.5 | $97.6 | (6)% | (1)% | | Adjusted Diluted EPS | $1.22 | $1.28 | $1.20 | (5)% | 1 % | | Book Value per Share (excl. unrealized G/L) | $32.08 | $30.85 | $27.54 | 4 % | 16 % | | Annualized Return on Equity | 16.2 % | 18.1 % | 18.3 % | | | | Annualized Adjusted Return on Equity | 16.3 % | 18.1 % | 19.4 % | | | | PMIERs Available Assets ($B) | $3.2 | | | | | | Net Risk-Based Required Assets ($B) | $1.9 | | | | | [Company Information & Disclosures](index=2&type=section&id=2.%20Company%20Information%20%26%20Disclosures) This section provides an overview of NMI Holdings, Inc., details for the upcoming conference call, and important cautionary notes regarding forward-looking statements [About NMI Holdings, Inc.](index=2&type=section&id=2.1.%20About%20NMI%20Holdings%2C%20Inc.) NMI Holdings, Inc. is the parent company of National Mortgage Insurance Corporation, a private mortgage insurance provider enabling homeownership and protecting lenders - NMI Holdings, Inc. (NASDAQ: NMIH) is the parent company of National Mortgage Insurance Corporation (National MI)[7](index=7&type=chunk) - National MI is a U.S.-based, private mortgage insurance company[7](index=7&type=chunk) - The company enables low down payment borrowers to realize home ownership while protecting lenders and investors against losses related to a borrower's default[7](index=7&type=chunk) [Conference Call and Webcast Details](index=2&type=section&id=2.2.%20Conference%20Call%20and%20Webcast%20Details) A live conference call and webcast for Q2 2025 results are scheduled for July 29, 2025, accessible via the company's investor relations website - A conference call and live webcast will be held on July 29, 2025, at 2:00 p.m. Pacific Time / 5:00 p.m. Eastern Time[6](index=6&type=chunk) - The webcast will be available on the company's website, www.nationalmi.com, in the 'Investor Relations' section[6](index=6&type=chunk) [Cautionary Note Regarding Forward-Looking Statements](index=2&type=section&id=2.3.%20Cautionary%20Note%20Regarding%20Forward-Looking%20Statements) This document contains forward-looking statements subject to various risks and uncertainties, including economic conditions and regulatory changes, with no obligation to update them - Certain statements in the press release may constitute forward-looking statements under Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and the PSLRA[8](index=8&type=chunk) - Forward-looking statements involve estimates, known and unknown risks, assumptions, and uncertainties that could cause actual results to differ materially[8](index=8&type=chunk) - Important factors that could cause actual events or results to differ materially include changes in general economic, market, and political conditions, changes in GSE policies, regulatory changes, and actions of competitors[8](index=8&type=chunk)[9](index=9&type=chunk) [Non-GAAP Financial Measures](index=3&type=section&id=3.%20Non-GAAP%20Financial%20Measures) This section defines and reconciles non-GAAP financial measures used by NMI Holdings to provide enhanced transparency into its fundamental financial performance [Use and Definition of Non-GAAP Measures](index=3&type=section&id=3.1.%20Use%20and%20Definition%20of%20Non-GAAP%20Measures) NMI Holdings utilizes non-GAAP measures like adjusted net income and EPS to improve comparability and provide relevant investor information, not as GAAP alternatives - The company uses non-GAAP measures such as adjusted income before tax, adjusted net income, adjusted diluted EPS, adjusted return-on-equity, adjusted expense ratio, adjusted combined ratio, and book value per share (excluding net unrealized gains and losses)[10](index=10&type=chunk) - These measures enhance comparability of fundamental financial performance between periods and provide relevant information to investors, aligning with how management evaluates business performance[10](index=10&type=chunk) - Definitions are provided for various adjusted metrics, detailing specific exclusions like net realized investment gains/losses and capital markets transaction costs[11](index=11&type=chunk)[12](index=12&type=chunk)[13](index=13&type=chunk)[14](index=14&type=chunk)[15](index=15&type=chunk) [Non-GAAP Reconciliations](index=7&type=section&id=3.2.%20Non-GAAP%20Reconciliations) Detailed reconciliations of GAAP to non-GAAP financial measures are provided for Q2 2025 and comparative periods, highlighting adjustments for investment gains/losses and transaction costs Non-GAAP Financial Measure Reconciliations | Metric | Q2 2025 (3 months) ($K) | Q1 2025 (3 months) ($K) | Q2 2024 (3 months) ($K) | YTD 2025 (6 months) ($K) | YTD 2024 (6 months) ($K) | | :------------------------------------ | :---------------------- | :---------------------- | :---------------------- | :----------------------- | :----------------------- | | Net income (GAAP) ($K) | $96,151 | $102,559 | $92,079 | $198,710 | $181,129 | | Adjustments: | | | | | | | Net realized investment losses (gains) ($K) | $400 | $(24) | — | $376 | — | | Capital markets transaction costs ($K) | — | — | $6,966 | — | $6,966 | | Adjusted net income ($K) | $96,467 | $102,540 | $97,582 | $199,007 | $186,632 | | Diluted EPS (GAAP) | $1.21 | $1.28 | $1.13 | $2.50 | $2.22 | | Adjusted diluted EPS | $1.22 | $1.28 | $1.20 | $2.50 | $2.28 | | Return on equity (GAAP) | 16.2 % | 18.1 % | 18.3 % | 17.1 % | 18.2 % | | Adjusted return on equity | 16.3 % | 18.1 % | 19.4 % | 17.2 % | 18.8 % | | Book value per share (GAAP) | $31.14 | $29.65 | $25.65 | | | | Book value per share (excluding net unrealized gains and losses) | $32.08 | $30.85 | $27.54 | | | - The marginal tax impact of non-GAAP adjustments is calculated based on a statutory U.S. federal corporate income tax rate of **21%**[23](index=23&type=chunk) [Consolidated Financial Statements](index=5&type=section&id=4.%20Consolidated%20Financial%20Statements) This section presents the consolidated statements of operations, comprehensive income, and balance sheets for NMI Holdings, Inc., detailing revenue, expenses, assets, and equity [Consolidated Statements of Operations and Comprehensive Income](index=5&type=section&id=4.1.%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income) Q2 2025 saw total revenues increase to **$173.8 million** (up **7%** YoY), but total expenses significantly rose to **$50.2 million** (up **15%** YoY) due to higher insurance claims Consolidated Statements of Operations and Comprehensive Income (In Thousands) | Metric | Q2 2025 ($K) | Q2 2024 ($K) | YTD 2025 ($K) | YTD 2024 ($K) | | :-------------------------------- | :----------- | :----------- | :------------ | :------------ | | Net premiums earned | $149,066 | $141,168 | $298,432 | $277,825 | | Net investment income | $24,949 | $20,688 | $48,635 | $40,124 | | Total revenues | $173,779 | $162,122 | $347,025 | $318,375 | | Insurance claims and claim expenses | $13,445 | $276 | $17,923 | $3,970 | | Underwriting and operating expenses | $29,508 | $28,330 | $59,683 | $58,145 | | Total expenses | $50,178 | $43,478 | $92,053 | $85,164 | | Income before income taxes | $123,601 | $118,644 | $254,972 | $233,211 | | Net income | $96,151 | $92,079 | $198,710 | $181,129 | | Diluted EPS | $1.21 | $1.13 | $2.50 | $2.22 | | Loss ratio | 9.0 % | 0.2 % | 6.0 % | 1.4 % | | Expense ratio | 19.8 % | 20.1 % | 20.0 % | 20.9 % | | Combined ratio | 28.8 % | 20.3 % | 26.0 % | 22.4 % | - Insurance claims and claim expenses increased significantly to **$13.4 million** in Q2 2025 from **$0.3 million** in Q2 2024, leading to a loss ratio of **9.0%** compared to **0.2%** in the prior year quarter[18](index=18&type=chunk) [Consolidated Balance Sheets](index=6&type=section&id=4.2.%20Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets grew to **$3.59 billion** and total shareholders' equity rose to **$2.42 billion**, driven by increased retained earnings and reduced comprehensive loss Consolidated Balance Sheets (In Thousands) | Metric | June 30, 2025 ($K) | December 31, 2024 ($K) | | :------------------------------------ | :----------------- | :--------------------- | | Fixed maturities, available-for-sale | $2,929,117 | $2,723,541 | | Cash and cash equivalents | $84,013 | $54,308 | | Total assets | $3,591,085 | $3,349,973 | | Debt | $416,073 | $415,146 | | Reserve for insurance claims and claim expenses | $163,033 | $152,071 | | Deferred tax liability, net | $441,389 | $386,192 | | Total liabilities | $1,170,978 | $1,132,541 | | Retained earnings | $1,781,969 | $1,583,259 | | Accumulated other comprehensive loss, net of tax | $(72,757) | $(124,804) | | Total shareholders' equity | $2,420,107 | $2,217,432 | - Total assets increased by **$241.1 million** (**7.2%**) from December 31, 2024, to **$3.59 billion** as of June 30, 2025[20](index=20&type=chunk) - Total shareholders' equity increased by **$202.7 million** (**9.1%**) from December 31, 2024, to **$2.42 billion** as of June 30, 2025, driven by higher retained earnings and a reduced accumulated other comprehensive loss[20](index=20&type=chunk) [Historical Quarterly Financial Data](index=9&type=section&id=5.%20Historical%20Quarterly%20Financial%20Data) This section provides historical quarterly consolidated statements of operations, illustrating trends in net income, EPS, and loss ratios over the past five quarters [Quarterly Consolidated Statements of Operations](index=9&type=section&id=5.1.%20Quarterly%20Consolidated%20Statements%20of%20Operations) NMI Holdings' Q2 2025 net income was **$96.2 million**, lower than Q1 2025 but higher than Q2 2024, with significant volatility in the loss ratio over the past five quarters Historical Quarterly Consolidated Statements of Operations (In Thousands) | Metric | Q2 2025 ($K) | Q1 2025 ($K) | Q4 2024 ($K) | Q3 2024 ($K) | Q2 2024 ($K) | | :-------------------------------- | :----------- | :----------- | :----------- | :----------- | :----------- | | Net premiums earned | $149,066 | $149,366 | $143,520 | $143,343 | $141,168 | | Total revenues | $173,779 | $173,246 | $166,504 | $166,092 | $162,122 | | Insurance claims and claim expenses | $13,445 | $4,478 | $17,253 | $10,321 | $276 | | Total expenses | $50,178 | $41,875 | $55,631 | $46,765 | $43,478 | | Net income | $96,151 | $102,559 | $86,167 | $92,810 | $92,079 | | Diluted EPS | $1.21 | $1.28 | $1.07 | $1.15 | $1.13 | | Loss ratio | 9.0 % | 3.0 % | 12.0 % | 7.2 % | 0.2 % | | Expense ratio | 19.8 % | 20.2 % | 21.7 % | 20.3 % | 20.1 % | | Combined ratio | 28.8 % | 23.2 % | 33.7 % | 27.5 % | 20.3 % | - Net income decreased by **6.2%** quarter-over-quarter from **$102.6 million** in Q1 2025 to **$96.2 million** in Q2 2025[24](index=24&type=chunk) - The loss ratio significantly increased from **0.2%** in Q2 2024 to **9.0%** in Q2 2025, indicating a rise in claims[24](index=24&type=chunk) [Insurance Portfolio Performance](index=10&type=section&id=6.%20Insurance%20Portfolio%20Performance) This section details the primary insurance portfolio trends, new insurance written, insurance-in-force composition, reinsurance programs, and geographic dispersion of risk [Primary Portfolio Trends](index=10&type=section&id=6.1.%20Primary%20Portfolio%20Trends) The primary insurance portfolio grew to **$214.7 billion** in insurance-in-force, but the number of loans in default and the default rate increased year-over-year to **1.00%** Primary Portfolio Trends (As of and for the three months ended) | Metric | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :------------------------------------ | :-------------- | :------------- | :------------ | | New insurance written (NIW) ($M) | $12,464 | $9,221 | $12,503 | | Insurance-in-force (IIF) ($M) | $214,653 | $211,308 | $203,501 | | Risk-in-force (RIF) ($M) | $57,496 | $56,515 | $53,956 | | Policies in force (count) | 668,638 | 661,490 | 645,276 | | Loans in default (count) | 6,709 | 6,859 | 4,904 | | Default rate | 1.00 % | 1.04 % | 0.76 % | | Annual persistency | 84.1 % | 84.3 % | 85.4 % | - Primary Insurance-in-Force grew **5%** year-over-year to **$214.7 billion** as of June 30, 2025[28](index=28&type=chunk) - The default rate increased from **0.76%** in Q2 2024 to **1.00%** in Q2 2025[28](index=28&type=chunk) [New Insurance Written (NIW) and Insurance-in-Force (IIF)](index=10&type=section&id=6.2.%20New%20Insurance%20Written%20%28NIW%29%20and%20Insurance-in-Force%20%28IIF%29) New Insurance Written (NIW) for Q2 2025 was **$12.46 billion**, contributing to a total primary Insurance-in-Force (IIF) of **$214.7 billion**, predominantly for purchase mortgages [NIW Composition (FICO, LTV, Purchase/Refinance)](index=11&type=section&id=6.2.1.%20NIW%20Composition%20%28FICO%2C%20LTV%2C%20Purchase%2FRefinance%29) Q2 2025 New Insurance Written (NIW) was primarily for purchase mortgages (**94.8%**), with a weighted average FICO of **756** and LTV of **92.0%** - New insurance written (NIW) for Q2 2025 was **$12,464 million**, a **35%** increase from Q1 2025 (**$9,221 million**)[28](index=28&type=chunk)[31](index=31&type=chunk) - The majority of NIW in Q2 2025 was for purchase mortgages (**$11,813 million**, or **94.8%**)[36](index=36&type=chunk) - Weighted average FICO for NIW in Q2 2025 was **756**, and weighted average LTV was **92.0%**[35](index=35&type=chunk) NIW by FICO, LTV, and Purchase/Refinance Mix (Q2 2025) | Category | Q2 2025 ($M) | Percentage of Total NIW | | :------------------------ | :------------- | :---------------------- | | **NIW by FICO** | | | | >= 760 | $6,523 | 52.3 % | | 740-759 | $2,281 | 18.3 % | | 720-739 | $1,585 | 12.7 % | | 700-719 | $1,061 | 8.5 % | | 680-699 | $590 | 4.7 % | | <=679 | $424 | 3.4 % | | **NIW by LTV** | | | | 95.01% and above | $1,544 | 12.4 % | | 90.01% to 95.00% | $5,486 | 44.0 % | | 85.01% to 90.00% | $3,887 | 31.2 % | | 85.00% and below | $1,547 | 12.4 % | | **NIW by Mix** | | | | Purchase | $11,813 | 94.8 % | | Refinance | $651 | 5.2 % | [IIF and RIF Composition (Book Year, FICO, LTV)](index=12&type=section&id=6.2.2.%20IIF%20and%20RIF%20Composition%20%28Book%20Year%2C%20FICO%2C%20LTV%29) As of June 30, 2025, total primary Insurance-in-Force (IIF) was **$214.7 billion**, with the largest portions by FICO (>=760) and LTV (90.01%-95.00%) - Total primary Insurance-in-Force (IIF) was **$214,653 million** and Risk-in-Force (RIF) was **$57,496 million** as of June 30, 2025[37](index=37&type=chunk) - The largest portion of IIF by FICO (**50.2%**) is from loans with FICO scores >= **760** (**$107,677 million**)[38](index=38&type=chunk) - The largest portion of IIF by LTV (**49.4%**) is from loans with LTVs between **90.01%** and **95.00%** (**$106,017 million**)[39](index=39&type=chunk) - Fixed-rate mortgages constitute **98%** of the primary RIF by loan type[39](index=39&type=chunk) [Change in Primary IIF](index=13&type=section&id=6.2.3.%20Change%20in%20Primary%20IIF) Primary Insurance-in-Force (IIF) increased by **$3.345 billion** during Q2 2025, driven by **$12.464 billion** in new insurance written, partially offset by reductions Change in Total Primary IIF (In Millions) | Metric | June 30, 2025 ($M) | | :------------------------------------------ | :----------------- | | IIF, beginning of period | $211,308 | | NIW | $12,464 | | Cancellations, principal repayments and other reductions | $(9,119) | | IIF, end of period | $214,653 | - Primary IIF increased by **$3,345 million** during Q2 2025, driven by new insurance written of **$12,464 million**, partially offset by **$9,119 million** in reductions[40](index=40&type=chunk) [Reinsurance Program Details](index=11&type=section&id=6.3.%20Reinsurance%20Program%20Details) NMI Holdings manages risk through quota-share, insurance-linked note, and excess-of-loss reinsurance transactions, with **$12.76 billion** in ceded risk-in-force for Q2 2025 - The company engages in quota-share reinsurance (QSR), insurance-linked note (ILN), and traditional excess-of-loss (XOL) transactions[32](index=32&type=chunk) Reinsurance Transactions (Q2 2025, In Thousands) | Metric | June 30, 2025 ($K) | | :-------------------------------- | :----------------- | | **The QSR Transactions** | | | Ceded risk-in-force | $12,764,708 | | Ceded premiums earned | $(40,227) | | Ceded claims and claim expenses (benefits) | $3,253 | | Ceding commission earned | $9,669 | | Profit commission | $19,958 | | **The ILN Transactions** | | | Ceded premiums | $(3,244) | | **The XOL Transactions** | | | Ceded Premiums | $(10,350) | - NMIC exercised optional termination rights for previously outstanding excess-of-loss reinsurance agreements with Oaktown Re III Ltd. and Oaktown Re V Ltd. in July and December 2024, respectively[33](index=33&type=chunk) [Geographic Dispersion of Risk-in-Force](index=14&type=section&id=6.4.%20Geographic%20Dispersion%20of%20Risk-in-Force) NMI Holdings' primary risk-in-force (RIF) remains geographically diversified, with the top three states (California, Texas, Florida) accounting for **25.7%** of total RIF Top 10 Primary RIF by State (As of June 30, 2025) | State | Percentage of RIF | | :------------ | :---------------- | | California | 10.1 % | | Texas | 8.4 % | | Florida | 7.2 % | | Georgia | 4.0 % | | Illinois | 3.9 % | | Washington | 3.8 % | | Virginia | 3.7 % | | Pennsylvania | 3.5 % | | Ohio | 3.4 % | | North Carolina | 3.2 % | | Total | 51.2 % | - The top 10 states accounted for **51.2%** of primary RIF as of June 30, 2025, a slight decrease from **51.7%** in Q2 2024[42](index=42&type=chunk) [Portfolio Quality by Book Year](index=14&type=section&id=6.5.%20Portfolio%20Quality%20by%20Book%20Year) Portfolio quality by book year shows recent years (2021-2025) with higher remaining insurance in force, while 2022 and 2023 exhibit higher incurred loss ratios Selected Primary Portfolio Statistics by Book Year (As of June 30, 2025) | Book Year | Remaining Insurance in Force ($M) | % Remaining of Original Insurance | Incurred Loss Ratio (Inception to Date) | Current Default Rate | | :---------------- | :-------------------------------- | :-------------------------------- | :-------------------------------------- | :------------------- | | 2016 and prior | $1,996 | 5 % | 2.2 % | 2.0 % | | 2017 | $1,667 | 8 % | 1.9 % | 2.5 % | | 2018 | $2,191 | 8 % | 2.4 % | 2.9 % | | 2019 | $5,612 | 12 % | 2.0 % | 1.7 % | | 2020 | $18,847 | 30 % | 1.3 % | 0.8 % | | 2021 | $45,409 | 53 % | 3.2 % | 1.0 % | | 2022 | $44,598 | 76 % | 16.5 % | 1.5 % | | 2023 | $32,013 | 79 % | 14.2 % | 0.9 % | | 2024 | $41,100 | 89 % | 10.1 % | 0.4 % | | 2025 | $21,220 | 98 % | 1.5 % | 0.0 % | - The 2022 and 2023 book years show the highest incurred loss ratios (inception to date) at **16.5%** and **14.2%**, respectively[43](index=43&type=chunk) - More recent book years (2024 and 2025) have significantly lower current default rates (**0.4%** and **0%**, respectively)[43](index=43&type=chunk) [Claims and Loss Development](index=15&type=section&id=7.%20Claims%20and%20Loss%20Development) This section reconciles the reserve for insurance claims, analyzes loans in default, details claims paid, and presents the average reserve per default [Reserve for Insurance Claims and Claim Expenses Reconciliation](index=15&type=section&id=7.1.%20Reserve%20for%20Insurance%20Claims%20and%20Claim%20Expenses%20Reconciliation) The reserve for insurance claims and claim expenses increased to **$163.0 million** by June 30, 2025, driven by **$17.6 million** in incurred claims, partially offset by **$7.1 million** paid Reconciliation of Reserve for Insurance Claims and Claim Expenses (In Thousands) | Metric | Q2 2025 (3 months) ($K) | YTD 2025 (6 months) ($K) | | :------------------------------------------ | :---------------------- | :----------------------- | | Beginning balance | $151,847 | $152,071 | | Beginning balance, net of reinsurance recoverables | $120,468 | $119,811 | | Total claims and claim expenses incurred | $13,112 | $17,590 | | Total claims and claim expenses paid | $3,252 | $7,073 | | Ending balance, net of reinsurance recoverables | $130,328 | $130,328 | | Ending balance | $163,033 | $163,033 | - The ending reserve balance for insurance claims and claim expenses (gross) increased to **$163.0 million** as of June 30, 2025, from **$152.1 million** at December 31, 2024[45](index=45&type=chunk) - For the six months ended June 30, 2025, total claims and claim expenses incurred were **$17.6 million**, while total claims and claim expenses paid were **$7.1 million**[45](index=45&type=chunk) [Loans in Default Reconciliation](index=15&type=section&id=7.2.%20Loans%20in%20Default%20Reconciliation) The number of loans in default decreased slightly in Q2 2025 to **6,709**, as **2,215** cures and other reductions exceeded **2,169** new defaults Reconciliation of Loans in Default | Metric | Q2 2025 (3 months) | YTD 2025 (6 months) | | :-------------------------- | :----------------- | :------------------ | | Beginning default inventory | 6,859 | 6,642 | | Plus: new defaults | 2,169 | 4,590 | | Less: cures | (2,215) | (4,309) | | Less: claims paid | (93) | (188) | | Less: rescission and claims denied | (11) | (26) | | Ending default inventory | 6,709 | 6,709 | - The ending default inventory decreased from **6,859** at the start of Q2 2025 to **6,709** at the end, primarily due to cures exceeding new defaults[49](index=49&type=chunk) [Claims Paid Analysis](index=16&type=section&id=7.3.%20Claims%20Paid%20Analysis) In Q2 2025, NMI Holdings paid **93** claims totaling **$5.5 million**, with an average amount of **$59 thousand** per claim and a significantly higher severity of **82%** Claims Paid Details (Q2 2025, In Thousands) | Metric | Q2 2025 ($K) | Q2 2024 ($K) | | :-------------------------- | :----------- | :----------- | | Number of claims paid | 93 | 59 | | Total amount paid for claims | $5,512 | $1,877 | | Average amount paid per claim | $59 | $32 | | Severity | 82 % | 54 % | - The number of claims paid increased by **57.6%** year-over-year, from **59** in Q2 2024 to **93** in Q2 2025[50](index=50&type=chunk) - Claim severity increased significantly from **54%** in Q2 2024 to **82%** in Q2 2025[50](index=50&type=chunk) [Average Reserve per Default](index=16&type=section&id=7.4.%20Average%20Reserve%20per%20Default) As of June 30, 2025, the average reserve per default was **$24.3 thousand**, a decrease from **$25.6 thousand** in Q2 2024, comprising case and IBNR reserves Average Reserve per Default (As of June 30, In Thousands) | Metric | 2025 ($K) | 2024 ($K) | | :---------- | :-------- | :-------- | | Case | $22.3 | $23.6 | | IBNR | $2.0 | $2.0 | | Total | $24.3 | $25.6 | - The total average reserve per default decreased from **$25.6 thousand** in Q2 2024 to **$24.3 thousand** in Q2 2025[51](index=51&type=chunk) [Regulatory Capital Position](index=16&type=section&id=8.%20Regulatory%20Capital%20Position) This section outlines NMI Holdings' strong regulatory capital position, detailing PMIERs available assets and net risk-based required assets [PMIERs Available Assets and Required Assets](index=16&type=section&id=8.1.%20PMIERs%20Available%20Assets%20and%20Required%20Assets) As of June 30, 2025, NMI Holdings maintained **$3.24 billion** in PMIERs available assets, significantly exceeding **$1.93 billion** in net risk-based required assets PMIERs Available Assets and Net Risk-Based Required Assets (As of, In Thousands) | Metric | June 30, 2025 ($K) | March 31, 2025 ($K) | June 30, 2024 ($K) | | :------------------------------ | :----------------- | :------------------ | :----------------- | | Available assets | $3,244,517 | $3,230,653 | $2,827,721 | | Net risk-based required assets | $1,926,517 | $1,867,414 | $1,651,569 | - PMIERs available assets of **$3.24 billion** significantly exceeded net risk-based required assets of **$1.93 billion** as of June 30, 2025[52](index=52&type=chunk) - Available assets increased by **14.7%** year-over-year from **$2.83 billion** in Q2 2024 to **$3.24 billion** in Q2 2025[52](index=52&type=chunk)

Core Insights - NMI Holdings, Inc. reported a net income of $96.2 million for Q2 2025, a decrease from $102.6 million in Q1 2025 but an increase from $92.1 million in Q2 2024, with diluted EPS at $1.21 [1][4] - The company highlighted strong operating performance and growth in its insured portfolio, with a robust balance sheet and significant earnings power [2] Financial Performance - Adjusted net income for Q2 2025 was $96.5 million, down from $102.5 million in Q1 2025 but slightly up from $97.6 million in Q2 2024 [1][4] - Total revenue for Q2 2025 was $173.8 million, compared to $173.2 million in Q1 2025 and $162.1 million in Q2 2024 [4] - Net premiums earned were $149.1 million, a slight decrease from $149.4 million in Q1 2025 but an increase from $141.2 million in Q2 2024 [4] Insurance Metrics - Primary insurance-in-force reached $214.7 billion, up 2% from $211.3 billion in Q1 2025 and 5% from $203.5 billion in Q2 2024 [3][4] - New insurance written (NIW) was $12.5 billion, a significant increase of 35% from $9.2 billion in Q1 2025, with no year-over-year change [3] Claims and Expenses - Insurance claims and claim expenses rose to $13.4 million, a substantial increase from $4.5 million in Q1 2025 and $0.3 million in Q2 2024, resulting in a loss ratio of 9.0% [4][5] - Underwriting and operating expenses were $29.5 million, down from $30.2 million in Q1 2025 but up from $28.3 million in Q2 2024, leading to an expense ratio of 19.8% [4][5] Shareholder Metrics - Shareholders' equity at the end of Q2 2025 was $2.4 billion, with a book value per share of $31.14, up 4% from $30.85 in Q1 2025 and 16% from $27.54 in Q2 2024 [4][5] - The annualized return on equity for the quarter was 16.2%, down from 18.1% in Q1 2025 and 18.3% in Q2 2024 [4][5]

Company Announcement - NMI Holdings, Inc. will report its second quarter results for the period ended June 30, 2025, after market close on July 29, 2025 [1] - A conference call and live webcast will be held at 2:00 p.m. Pacific Time / 5:00 p.m. Eastern Time on the same day [2] Company Overview - NMI Holdings, Inc. is the parent company of National Mortgage Insurance Corporation, a private mortgage insurance company in the U.S. that supports low-down-payment borrowers while protecting lenders and investors from losses due to borrower defaults [3]

Core Insights - National Mortgage Insurance Corporation (National MI) has received three prestigious company culture awards, including recognition as a Great Place To Work in 2025 and a "Decade of Great" distinction for ten consecutive years [1][2] - The company ranked No. 22 among Fortune magazine's Best Workplaces in the Bay Area, achieving this position by surpassing rigorous benchmarks [2][4] - A significant 96% of employees affirmed that National MI is a Great Place To Work, which is 39 points higher than the average U.S. company [3] Company Culture and Employee Experience - National MI emphasizes the importance of employee feedback in shaping workplace culture, with a commitment to maintaining a collaborative and positive environment [5] - The company has established a new standard of excellence in the industry, driven by a talented and dedicated team [3][5] - Employees rated National MI highly in areas such as excellent service delivery, a welcoming environment for new employees, work-life balance encouragement, and celebrating innovative approaches [8] Recognition and Methodology - This marks National MI's fourth appearance on the Fortune Best Workplaces in the Bay Area List, highlighting its consistent performance in employee satisfaction [4] - The selection for the Fortune Best Workplaces in the Bay Area involved surveying 1.3 million employees across the U.S., with nearly 85,000 responses from eligible companies [9]

Core Viewpoint - NMI Holdings Inc. (NMIH) is experiencing strong investor confidence, with shares closing at $40.69, near its 52-week high, indicating potential for further price appreciation [1] Stock Performance - NMIH shares have gained 25.1% over the past year, outperforming the Finance sector's growth of 18.4% and the Zacks S&P 500 composite's growth of 9.4% [4] - The stock is trading above its 50-day and 200-day simple moving averages of $36.94 and $37.82, respectively, indicating solid upward momentum [1] Earnings Growth - NMIH's earnings have grown by 15.7% over the last five years, with a solid surprise history of beating earnings estimates in three of the last four quarters, averaging an 8.17% beat [2] - The Zacks Consensus Estimate for NMIH's 2025 earnings per share indicates a year-over-year increase of 8%, with revenues projected to reach $685.46 million, reflecting a 5.3% improvement [8] Valuation Metrics - NMIH shares are trading at a forward price-to-book value of 1.36X, lower than the industry average of 1.56X and the Finance sector's 4.11X [7] - The average target price for NMIH, based on short-term price targets from seven analysts, is $41.86 per share, suggesting a potential upside of 3.7% from the last closing price [12] Analyst Sentiment - Analysts have raised estimates for NMIH's earnings for 2025 by 5.4% and for 2026 by 1.2% over the past 60 days, indicating positive sentiment [9] Return on Capital - NMIH's return on equity (ROE) for the trailing 12 months was 17.27%, significantly higher than the industry's 7.8%, reflecting efficient utilization of shareholders' funds [14] Growth Opportunities - NMIH is well-positioned to capitalize on growth in the mortgage insurance sector, supported by a robust reinsurance strategy and increased production of both monthly and single premium policies [6][15] - The company has authorized a new $250 million share repurchase program to enhance its return profile and manage expenses effectively [17] Conclusion - NMIH is expected to benefit from favorable growth estimates, a higher return on capital, and an attractive valuation, making it a stock worth holding [19][20]

Company Overview - NMI Holdings (NMIH) shares have increased by approximately 7.6% since the last earnings report, outperforming the S&P 500 [1] - The most recent earnings report is essential to understand the catalysts affecting the stock's performance [1] Earnings Estimates - Estimates for NMI Holdings have remained unchanged over the past month, indicating a flatlining of revisions [2] VGM Scores - NMI Holdings has a Growth Score of B, a Momentum Score of F, and a Value Score of B, placing it in the top 40% for the value investment strategy [3] - The aggregate VGM Score for NMI Holdings is B, which is relevant for investors not focused on a single strategy [3] Outlook - NMI Holdings holds a Zacks Rank of 3 (Hold), suggesting an expectation of an in-line return from the stock in the upcoming months [4] Industry Performance - NMI Holdings is part of the Zacks Insurance - Property and Casualty industry, where Kinsale Capital Group, a peer, has gained 7.8% over the past month [5] - Kinsale Capital Group reported revenues of $423.4 million for the quarter ended March 2025, reflecting a year-over-year increase of 13.6% [5] - Kinsale Capital Group's EPS for the same period was $3.71, compared to $3.50 a year ago [5] - Kinsale Capital Group is projected to post earnings of $4.36 per share for the current quarter, representing a year-over-year change of 16.3% [6] - The Zacks Consensus Estimate for Kinsale Capital Group has changed by -0.1% over the last 30 days, and it also holds a Zacks Rank of 3 (Hold) [6]

Core Viewpoint - NMI Holdings Inc. (NMIH) is experiencing a short-term bullish trend, trading above its 50-day simple moving average, despite a recent decline in share price from its 52-week high [1] Valuation and Market Position - NMIH shares are trading at a price-to-book multiple of 1.25X, which is lower than the industry average of 1.52X, the Finance sector's 4.11X, and the Zacks S&P 500 Composite's 7.8X, indicating attractive valuation [4] - The company has a market capitalization of $2.90 billion, with an average trading volume of 0.6 million shares over the last three months [6] Performance Metrics - NMIH's shares have gained 10.3% over the past year, lagging behind the industry's growth of 19.8%, the Finance sector's return of 16.8%, and the S&P 500 composite's appreciation of 11.1% [7][9] - The Zacks Consensus Estimate for NMIH's 2025 earnings per share indicates a year-over-year increase of 7.1%, with revenues expected to reach $686.01 million, reflecting a 5.4% improvement [10] - The expected long-term earnings growth rate for NMIH is 6.10%, which is slightly below the industry average of 6.9% [11] Return on Capital - NMIH's return on equity (ROE) for the trailing 12 months was 17.27%, significantly higher than the industry's 7.7%, showcasing efficient use of shareholders' funds [12] Growth Opportunities - NMIH is positioned to benefit from new business opportunities in the growing mortgage insurance market, with expectations of increased production in monthly and single premium policies [13] - The company has a comprehensive reinsurance program to enhance its return profile and manage credit volatility [14] Shareholder Returns - NMIH has engaged in share buybacks, repurchasing a total of $245 million of shares, with $80 million of repurchase capacity remaining [14] - These strategies are expected to help the insurer generate solid mid-teens returns for shareholders [15] Overall Outlook - NMIH is well-positioned for growth due to new primary insurance written, a comprehensive reinsurance program, and favorable growth estimates [16] - The stock has a VGM Score of A, indicating attractive value, growth, and momentum, suggesting it is wise to hold onto this stock [18]

Core Insights - Zacks Premium offers various tools for investors to enhance their stock market engagement and confidence [1] - The Zacks Style Scores serve as complementary indicators to the Zacks Rank, aiding investors in selecting stocks with high potential for market outperformance [2] Zacks Style Scores Overview - Stocks are rated from A to F based on value, growth, and momentum characteristics, with A being the highest score [3] - The Style Scores are categorized into four types: Value Score, Growth Score, Momentum Score, and VGM Score [3][4][5][6] Value Score - Focuses on identifying undervalued stocks using financial ratios such as P/E, PEG, and Price/Sales [3] Growth Score - Evaluates a company's financial health and future growth potential through projected earnings and sales [4] Momentum Score - Targets stocks with upward or downward price trends, utilizing recent price changes and earnings estimate shifts [5] VGM Score - Combines the three Style Scores to identify stocks with attractive value, growth forecasts, and momentum [6] Zacks Rank Integration - The Zacks Rank is based on earnings estimate revisions, with 1 (Strong Buy) stocks historically yielding an average annual return of +25.41% since 1988, outperforming the S&P 500 [8] - Investors are encouraged to select stocks with a Zacks Rank of 1 or 2 and Style Scores of A or B for optimal success [9] NMI Holdings Analysis - NMI Holdings, headquartered in Emeryville, CA, is currently rated 3 (Hold) with a VGM Score of A and a Growth Style Score of B, indicating a projected year-over-year earnings growth of 7.1% for the current fiscal year [11] - Recent upward revisions from three analysts have increased the Zacks Consensus Estimate for fiscal 2025 by $0.22 to $4.82 per share, with an average earnings surprise of 8.2% [12]

Core Viewpoint - NMI Holdings (NMIH) reported strong first-quarter 2025 results, with operating net income per share of $1.28, exceeding estimates and showing significant year-over-year growth [1] Operational Update - Total operating revenues reached $173.3 million, a 10.9% increase year over year, driven by a 9.3% rise in net premiums earned and a 21.9% increase in net investment income [2] - Primary insurance in force grew by 6% to $211.3 billion [2] - Annual persistency decreased to 84.3%, down 150 basis points year over year [2] - New insurance written was $9.2 billion, reflecting a 2% decline year over year [2] Underwriting and Operating Expenses - Underwriting and operating expenses totaled $30.2 million, up 1% year over year [3] - Insurance claims and claim expenses increased to $4.5 million, a rise of 21.2% year over year [3] - The loss ratio expanded to 3%, an increase of 30 basis points year over year [3] - The expense ratio improved by 160 basis points year over year, while the adjusted combined ratio improved to 23.2, a 130 basis point enhancement [3] Financial Update - Book value per share increased by 16.8% year over year to $30.85 as of March 31, 2025 [4] - Cash and cash equivalents rose to $74.2 million, a 36.6% increase from the end of 2024 [4] - Debt balance slightly increased by 0.1% to $416 million from the end of 2024 [4] - Annualized adjusted return on equity was 18.1%, contracting by 10 basis points year over year [4] PMIERs Update - Total PMIERs available assets were reported at $3.2 billion [5] - Net risk-based required assets totaled $1.9 billion at the end of the first quarter of 2025 [5]