NMI Holdings, Inc. (NASDAQ:NMIH) Q3 2019 Earnings Conference Call - Final Transcript
Nov 06, 2019 • 05:00 pm ET
Bradley M. Shuster
view has always been that we need to establish broad credit risk management strategies when times are good in order to fully benefit when the market turns, and this is exactly what we are doing.
We have developed and deployed the most comprehensive credit risk management framework in the industry, spanning Rate GPS, individual risk underwriting and our innovative reinsurance program. We believe that our ability to evaluate and price risk on a granular basis, the unique insight we gain from individually underwriting the vast majority of the loans we insure and our success in the ILN and reinsurance markets will enhance our return profile, mitigate the impact of credit volatility and drive shareholder value across all market cycles.
Shifting to Washington matters. On September 5th, the Departments of Treasury and Housing and Urban Development released proposals for the reform of the U.S. Housing Finance System including broad recommendations regarding the GSEs. The proposals were expansive and it will likely be some time before we have clarity on which elements are ultimately adopted or enacted. That said, we view the release of the plans and the conversations they are now prompting as an important step towards ensuring the long-term health of the mortgage market. We also believe the proposals as drafted are constructive for the mortgage insurance industry and National MI.
We were pleased to see explicit recognition of the value that institutional level capital brings to the market. The mortgage insurance industry, which provides a dedicated source of permanent capital support across all market cycles and exists under the strict oversight of state regulatory and PMIERs standards is uniquely positioned to fill this institutional level role.
We believe the treasury department's support for revisions to the ability to repay rule and their call for the CFPB and the FHFA to coordinate efforts to avoid any market disruption upon the planned expiration of the QM Patch is a constructive approach. We also believe that the treasury department's call to refocus the GSEs on their core function and establish a clear and transparent process to evaluate all new GSE products and programs will be valuable, helping to ensure a level playing field for all market participants going forward and avoiding the type of charter creeps that we saw with programs such as IMAGINE and EPMI.
The proposals also encourage closure coordination between the GSEs and FHA on housing policy matters. Over the long-term, we expect that this would reduce the risk of unnecessary competition between the GSEs and the FHA and help protect the rigorous underwriting standards that have proven so valuable in the post-crisis period.
Overall, we had another terrific quarter with record performance across every key financial and operational metric and we are well positioned to continue delivering on the goals we set for the business.
With that, I'll turn it over to Claudia.
Claudia J. Merkle
Thank you, Brad. In the third quarter, we delivered record performance, once again, expanding our customer franchise, achieving strong growth in NIW and insurance-in-force and