“I’m very proud of what we accomplished in 2014,” Evan Siddall, president and chief executive officer of CMHC said in an official release. “Beginning with a new mission, to help Canadians meet their housing needs, we took steps in all our areas of business to ensure our operations are aligned with CMHC’s refocused approach, and to be a high-performing organization to provide the most value to Canadians.”
CMHC’s net income rose to $2.6 billion in 2014 (up from $1.8 billion in 2013), while its total insurance in force fell $14 billion to $543 billion this past year.
The Crown Corporation has taken steps to minimize its influence on the economy and housing markets, which is evidenced by the shrinking number of assets, which totaled $248 billion in 2014 – down from $270 billion in 2013.
“In keeping with the Corporation’s focus on housing needs and in support of the Government’s efforts to reduce taxpayer exposure to the housing sector, CMHC made important changes to its mortgage loan insurance and securitization business,” CMHC said in an official release. “This included premium and fee adjustments, changes to policies for low-ratio insurance, and the discontinuation of some products, including mortgage loan insurance for second homes and for the construction of multi-unit condominiums.”
Total claims paid also fell for the fifth straight year to $419 million, which the corporation attributes to the strength of its underwriting.
“CMHC’s strong underwriting practices and sound mortgage loan insurance portfolio are reflected in the 2014 results,” CMHC said in the release. “Average credit scores at origination were 731 for transactional homeowner and 760 for portfolio, and the average borrower equity in CMHC’s insurance portfolio has remained stable at 46 per cent. Other key figures show mortgage loan insurance claims paid during the year decreased by 4 per cent from 2013 while the arrears rate remained relatively unchanged at 0.35 per cent.”
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For the third straight year, CMHC’s total assets and liabilities have fallen; but its net income and total revenue have increased to five-year highs.