One of Canada’s leading private insurers unveiled strong second quarter results and, perhaps more interestingly, one statistic that potentially points to a healthy housing market.
MI Canada reported a 12 per cent loss ratio, its lowest in seven years.
“You have a good housing market, very good borrowing demographics, and very good borrower profiles for us when it comes to FICO scores and credit scores,” Brian Hurley, CEO of Genworth Canada told BNN following the release.
However, the 12 per cent ratio isn’t expected to last, according to Hurley, who believes it will level out to the 20 per cent range by the end of the year.
“There’s no way this level’s going to stay,” he said.
Though he also noted that housing prices have been reined in – positive news
for housing bears who believe a bubble may be forming.
“Home appreciation has cooled down, just like we wanted it to,” Hurley told BNN, citing Vancouver as an example.
Genworth reported $97 million net income for the second quarter of 2014 and a net operating income of $99 million. Overall, premiums written increased 17 per cent of prior year in both high and low LTV mortgage segments.
"Strong business execution led to solid top line growth and our high quality insurance portfolio supported our trend of lower losses," Hurley said in an official release. "The business performance combined with the stable economic climate continues to drive our positive momentum."