Genworth Financial Canada underwrote $6.1 billion of new mortgages last quarter and saw a 47% increase in income from new premiums.
Genworth also estimates that its market share rose “a couple of points" since the 4th quarter.
While there’s no definitive market share statistics in Canada’s mortgage default insurance market, analysts have estimated Genworth held 20-25% of the market as of Q4 2009. Industry leader, CMHC, held almost all of the rest.
Genworth and it’s Chairman/CEO, Brian Hurley, attributed the company’s strong performance to these factors:
“A larger mortgage insurance market resulting from improved economic conditions."
"Low interest rates and a view that rates will go up”—which in turn “attracted many buyers."
"Deeper customer penetration."
Genworth Canada’s President, Peter Vukanovich, says "our customer focus is clearly working." He says Genworth has invested significant time and resources in supporting its lenders, and it’s paying off.
When asked if premium pricing will drop due to the industry’s new entrant (Canada Guaranty), Hurley said that pricing changes are quickly matched in an oligopoly market. He said he doesn’t “anticipate any downward pricing pressure" given regulators’ focus on financial soundness and strong capital bases.
Hurley feels that Canada Guaranty’s entry into the market will "keep service levels up.” But he also suggested that new entrants need to prove themselves, and said: "We saw the success that [prior insurer hopefuls] had."
(Prior hopefuls being MGIC, PMI, and Trinity—all of which pulled out of Canada’s market prematurely after the subprime crisis.)
Like news like this?
Join our CMT Updates list and get the latest news as it happens. Unsubscribe anytime.
Thank you for subscribing. One more step: Please confirm your subscription via the email sent to you.