Genworth Mortgage Insurance Australia Limited, a Lenders Mortgage Insurance (LMI) provider, recently reported their 2017 financial results, which showed they experienced a loss of 26.7 per cent.
These financial results have been substantially affected in recent years by APRA’s macro-prudential actions, which have caused tighter credit and a large reduction in high-LVR mortgage originations.
Earlier last year, Genworth Mortgage Insurance Australia Limited implemented a critical strategy to redefine its core business model and position the company as a major provider of customer-centric capital and risk-management solutions.
CEO Georgette Nicholas said, “I am pleased to report that we have made significant progress in implementing initiatives pursuant to this program of work. The company’s Strategic Program of Work is designed to address evolving lender and consumer expectations (resulting from technological and regulatory change) by leveraging Genworth’s existing core competencies in managing mortgage credit default risk.”
Georgette continued, “As part of this work program, a number of initiatives have been identified that focus on improving the company’s underwriting efficiency, enhancing its product offerings and, where appropriate, leveraging its data and mortgage partnerships along the mortgage value chain.”
One of these initiatives is related to the establishment of their offshore insurance presence in Bermuda. This will allow Genworth to structure bespoke its risk-management solutions to cover LVR (low and high loan-to-value ratios).
Ms Nicholas said, “By leveraging its strong relationships in the global reinsurance market, Genworth has created a consortium and entered into an agreement with a customer to utilise the new structure to manage mortgage default risk. This bespoke solution is a complementary risk management tool to traditional LMI cover.”
During the second half of 2017, Genworth concentrated work on the creation and application of risk-management solutions for borrower-paid LMI within the under 80 per cent LVR portion on a micro market basis.
Georgette Nicholas commented, “Both these initiatives demonstrate our ability as an organisation to tailor products and solutions for customers that address their evolving capital and risk management needs in a dynamic market environment.”
She concluded, “They also demonstrate our ability to leverage our extensive local experience, global expertise and strong relationships within international risk and capital markets to offer customers a greater depth and breadth of tailored risk and capital management tools that complement our traditional LMI offering.”
First Choice Mortgage Brokers are a Sydney Mortgage Broker operating under the Australian Credit Licence Number: 382370