Market Overview

Essent Group Ltd. Reports Second Quarter 2019 Results & Declares Inaugural Dividend


Essent Group Ltd. (NYSE:ESNT) today reported net income for the quarter ended June 30, 2019 of $136.4 million or $1.39 per diluted share, compared to $111.8 million or $1.14 per diluted share for the quarter ended June 30, 2018.

Essent also announced today that its Board of Directors has declared a quarterly cash dividend of $0.15 per common share. The dividend is payable on September 16, 2019, to shareholders of record on September 4, 2019.

"We are pleased with our strong financial results for the second quarter and our continued progress in transitioning our franchise to a buy, manage and distribute model through utilization of EssentEDGE and reinsurance," said Mark Casale, Chairman and Chief Executive Officer. "Our performance, along with the use of reinsurance, continues to generate excess capital. As a result, we are pleased to announce our inaugural dividend and believe that it is a tangible demonstration of the benefits in a buy, manage and distribute operating model."

Financial Highlights:

  • Insurance in force as of June 30, 2019 was $153.3 billion, compared to $143.2 billion as of March 31, 2019 and $122.5 billion as of June 30, 2018.
  • New insurance written for the second quarter was $18.0 billion, compared to $11.0 billion in the first quarter of 2019 and $12.9 billion in the second quarter of 2018.
  • Net premiums earned for the second quarter were $188.5 million, compared to $177.8 million in the first quarter of 2019 and $157.0 million in the second quarter of 2018.
  • The expense ratio for the second quarter was 22.0%, compared to 23.1% in the first quarter of 2019 and 23.2% in the second quarter of 2018.
  • The provision for losses and LAE for the second quarter was $5.0 million, compared to a provision of $7.1 million in the first quarter of 2019 and a provision of $1.8 million in the second quarter of 2018.
  • The percentage of loans in default as of June 30, 2019 was 0.66%, compared to 0.65% as of March 31, 2019 and 0.64% as of June 30, 2018.
  • The combined ratio for the second quarter was 24.7%, compared to 27.1% in the first quarter of 2019 and 24.4% in the second quarter of 2018.
  • The consolidated balance of cash and investments at June 30, 2019 was $3.2 billion, including cash and investment balances at Essent Group Ltd. of $72.0 million.
  • The combined risk-to-capital ratio of the U.S. mortgage insurance business, which includes statutory capital for both Essent Guaranty, Inc. and Essent Guaranty of PA, Inc., was 13.6:1 as of June 30, 2019.
  • In June, Essent Guaranty, Inc. obtained $333.8 million of excess of loss reinsurance coverage on mortgage insurance policies written by Essent in 2015 and 2016. The reinsurance is fully collateralized by ten-year mortgage insurance-linked notes ("ILNs") issued by Radnor Re 2019-2 Ltd., an unaffiliated special purpose insurer.

Conference Call

Essent management will hold a conference call at 10:00 AM Eastern time today to discuss its results. The conference call will be broadcast live over the Internet at The call may also be accessed by dialing 833-287-0797 inside the U.S., or 647-689-4456 for international callers, using passcode 7877815 or by referencing Essent.

A replay of the webcast will be available on the Essent website approximately two hours after the live broadcast ends for a period of one year. A replay of the conference call will be available approximately two hours after the call ends for a period of two weeks, using the following dial-in numbers and passcode: 800-585-8367 inside the U.S., or 416-621-4642 for international callers, passcode 7877815.

In addition to the information provided in the company's earnings news release, other statistical and financial information, which may be referred to during the conference call, will be available on Essent's website at

Forward-Looking Statements

This press release may include "forward-looking statements" which are subject to known and unknown risks and uncertainties, many of which may be beyond our control. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may," "will," "should," "expect," "plan," "anticipate," "believe," "estimate," "predict," or "potential" or the negative thereof or variations thereon or similar terminology. Actual events, results and outcomes may differ materially from our expectations due to a variety of known and unknown risks, uncertainties and other factors. Although it is not possible to identify all of these risks and factors, they include, among others, the following: changes in or to Fannie Mae and Freddie Mac (the "GSEs"), whether through Federal legislation, restructurings or a shift in business practices; failure to continue to meet the mortgage insurer eligibility requirements of the GSEs; competition for customers; lenders or investors seeking alternatives to private mortgage insurance; an increase in the number of loans insured through Federal government mortgage insurance programs, including those offered by the Federal Housing Administration; decline in new insurance written and franchise value due to loss of a significant customer; decline in the volume of low down payment mortgage originations; the definition of "Qualified Mortgage" reducing the size of the mortgage origination market or creating incentives to use government mortgage insurance programs; the definition of "Qualified Residential Mortgage" reducing the number of low down payment loans or lenders and investors seeking alternatives to private mortgage insurance; the implementation of the Basel III Capital Accord discouraging the use of private mortgage insurance; a decrease in the length of time that insurance policies are in force; uncertainty of loss reserve estimates; deteriorating economic conditions; our non-U.S. operations becoming subject to U.S. Federal income taxation; becoming considered a passive foreign investment company for U.S. Federal income tax purposes; and other risks and factors described in Part I, Item 1A "Risk Factors" of our Annual Report on Form 10-K for the year ended December 31, 2018 filed with the Securities and Exchange Commission on February 19, 2019. Any forward-looking information presented herein is made only as of the date of this press release, and we do not undertake any obligation to update or revise any forward-looking information to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise.

Non-GAAP Financial Measures

In presenting Essent Group Ltd.'s results, management has included financial measures, including adjusted book value per share, that are not calculated under standards or rules that comprise accounting principles generally accepted in the United States ("GAAP"). Such measures are referred to as "non-GAAP measures." These non-GAAP measures may be defined or calculated differently by other companies. Management believes these measures allow for a more complete understanding of the underlying business. These measures are used to monitor our results and should not be viewed as a substitute for those determined in accordance with GAAP. Reconciliations of such measures to the most comparable GAAP figures are included in the attached financial supplement in accordance with Regulation G.

About the Company

Essent Group Ltd. (NYSE:ESNT) is a Bermuda-based holding company (collectively with its subsidiaries, "Essent") which, through its wholly-owned subsidiary, Essent Guaranty, Inc., offers private mortgage insurance for single-family mortgage loans in the United States. Essent provides private capital to mitigate mortgage credit risk, allowing lenders to make additional mortgage financing available to prospective homeowners. Headquartered in Radnor, Pennsylvania, Essent Guaranty, Inc. is licensed to write mortgage insurance in all 50 states and the District of Columbia, and is approved by Fannie Mae and Freddie Mac. Essent also offers mortgage-related insurance, reinsurance and advisory services through its Bermuda-based subsidiary, Essent Reinsurance Ltd. Additional information regarding Essent may be found at and

Source: Essent Group Ltd.







Essent Group Ltd. and Subsidiaries

Financial Results and Supplemental Information (Unaudited)

Quarter Ended June 30, 2019







Exhibit A


Condensed Consolidated Statements of Comprehensive Income (Unaudited)

Exhibit B


Condensed Consolidated Balance Sheets (Unaudited)

Exhibit C


Historical Quarterly Data

Exhibit D


New Insurance Written

Exhibit E


Insurance in Force and Risk in Force

Exhibit F


Other Risk in Force

Exhibit G


Portfolio Vintage Data

Exhibit H


Reinsurance Vintage Data

Exhibit I


Portfolio Geographic Data

Exhibit J


Defaults, Reserve for Losses and LAE, and Claims

Exhibit K


Investments Available for Sale

Exhibit L


Insurance Company Capital

Exhibit M


Reconciliation of Non-GAAP Financial Measure - Adjusted Book Value per Share








Exhibit A









Essent Group Ltd. and Subsidiaries

Condensed Consolidated Statements of Comprehensive Income (Unaudited)


















Three Months Ended June 30,


Six Months Ended June 30,

(In thousands, except per share amounts)
















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