NMI Holdings, Inc. Reports Record Third Quarter Net Income of $6.2 Million

EMERYVILLE, CA--(Marketwired - November 01, 2016) - NMI Holdings, Inc. (NASDAQ: NMIH) today reported net income of $6.2 million, or $0.10 per share, for the third quarter ended Sep. 30, 2016. This compares with net income of $2.0 million, or $0.03 per share, in the prior quarter and a net loss of ($4.8) million, or ($0.08) per share, in the third quarter of 2015. Total revenue for the quarter was $35.5 million, up 20% from $29.5 million in the prior quarter and up 141% from $14.7 million in the third quarter of 2015.

Bradley Shuster, chairman and CEO of National MI, said, "We continued our positive momentum in the third quarter, delivering record net income and returns, trends that we expect will continue for the foreseeable future. We grew our high-quality insurance-in-force by 19% over the prior quarter and 166% over the third quarter last year. We also continued to shift our mix to high-return monthly product, which grew to 71% of total new insurance written in the quarter. Cessions commenced under our reinsurance agreement and we expect to continue to take advantage of the low cost of capital provided by reinsurance to support our future growth."

As of Sep. 30, 2016, the company had primary insurance-in-force of $28.2 billion, up 19% from $23.6 billion at the prior quarter end and up 166% over $10.6 billion as of Sep. 30, 2015.

Premiums earned for the quarter were $31.8 million, up 22% from $26.0 million in the prior quarter and up 148% over $12.8 million in the same quarter a year ago

Monthly premium NIW was $4.16 billion, an increase of 12% over $3.70 billion in the prior quarter and an increase of 163% over the third quarter of 2015. Single premium NIW of $1.70 billion was down 21% from the prior quarter and down 17% compared with the same quarter a year ago.

Total NIW in the third quarter was $5.86 billion, which compares with $5.84 billion in the prior quarter and $3.63 billion in the third quarter of 2015.

Total underwriting and operating expenses in the third quarter were $24.0 million, including share-based compensation expense of $1.8 million. This compares with total underwriting and operating expenses of $23.2 million, including $1.8 million of share-based compensation, in the prior quarter, and $19.7 million, including $1.8 million of share-based compensation, in the same quarter a year ago.

Loss expense for the quarter was $0.7 million, resulting in a loss ratio of 2.1%.

As of the end of the third quarter, the company had approved master policies in place with 1,100 customers, up from 1,061 as of the end of the prior quarter, and up from 906 as of the end of the third quarter of 2015. Customers delivering NIW in the quarter grew to a new high of 525, which compares with 518 in the prior quarter and 391 in the same quarter a year ago.

At quarter-end, cash and investments were $686 million, including $77 million at the holding company, and book equity was $430 million, equal to $7.28 per share. This book value excludes any benefit attributable to the company's deferred tax asset of approximately $66 million as of Dec. 31, 2015.

In the first nine months of 2016, the company generated $52.2 million of cash from operations, which compares with $16.2 million for the same period in 2015.

At quarter-end, the company had total PMIERs available assets of $489 million, which compares with risk- based required assets under PMIERs of $321 million.


		Quarter Ended 9/30/2016		Quarter Ended 6/30/2016		Quarter Ended 9/30/2015		Growth Q/Q	Growth Y/Y
Primary Insurance-in-Force ($billions)			28.22		23.62		10.60	19%	166%
New Insurance Written - NIW ($billions)
	Monthly premium		4.16		3.70		1.58	12%	163%
	Single premium		1.70		2.14		2.05	-21%	-17%
	Total		5.86		5.84		3.63	-	61%

Premiums Earned ($millions)			31.81		26.04		12.83	22%	148%
Underwriting & Operating Expense ($millions)			24.04		23.23		19.65	3%	22%
Loss Expense ($millions)			0.66		0.47		0.18	40%	267%
Loss Ratio			2.1%		1.8%		1.4%
Cash & Investments ($millions)			686		654		447	5%	53%
Book Equity ($millions)			430		422		408	2%	5%
Book Value per Share		$	7.28	$	7.14	$	6.95	2%	5%
Approved Master Policies			1100		1061		906	4%	21%
Customers Generating NIW			525		518		391	1%	34%

Conference Call and Webcast Details
The company will hold a conference call and live webcast today at 1:30 p.m. Pacific Time / 4:30 p.m. Eastern Time. The webcast will be available on the company's website, www.nationalmi.com, in the "Investor Relations" section. The call also can be accessed by dialing (888) 734-0328 in the U.S., or (914) 495-8578 for international callers using Conference ID: 93562675, or by referencing NMI Holdings, Inc.

About National MI
National Mortgage Insurance Corporation (National MI), a subsidiary of NMI Holdings, Inc. (NASDAQ: NMIH), is a U.S.-based, private mortgage insurance company enabling low down payment borrowers to realize home ownership while protecting lenders and investors against losses related to a borrower's default. To learn more, please visit www.nationalmi.com.

Cautionary Note Regarding Forward-Looking Statements
Certain statements contained in this press release or any other written or oral statements made by or on behalf of the Company in connection therewith may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (Securities Act), Section 21E of the Securities Exchange Act of 1934, as amended (Exchange Act), and the U.S. Private Securities Litigation Reform Act of 1995 (PSLRA). The PSLRA provides a "safe harbor" for any forward-looking statements. All statements other than statements of historical fact included in or incorporated by reference in this release are forward-looking statements, including any statements about our expectations, outlook, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance. These statements are often, but not always, made through the use of words or phrases such as "anticipate," "believe," "can," "could," "may," "predict," "assume," "potential," "should," "will," "estimate," "plan," "project," "continuing," "ongoing," "expect," "intend" and similar words or phrases. All forward-looking statements are only predictions and involve estimates, known and unknown risks, assumptions and uncertainties that may turn out to be inaccurate and could cause actual results to differ materially from those expressed in them. Many risks and uncertainties are inherent in our industry and markets. Others are more specific to our business and operations. Important factors that could cause actual events or results to differ materially from those indicated in such statements include, but are not limited to: our ability to implement our business strategy, including our ability to attract and retain a diverse customer base and to achieve a diversified mix of business across the spectrum of our product offerings; changes in the business practices of the GSEs that may impact the use of private mortgage insurance; our ongoing ability to comply with the financial requirements of the PMIERs; our ability to maintain sufficient holding company liquidity to meet our short- and long-term liquidity needs; our ability to successfully execute and implement our capital plans, including our ability to access the reinsurance market and to enter into, and receive approval of, reinsurance arrangements on terms and conditions that are acceptable to us, the GSEs and our regulators; heightened competition for our mortgage insurance business from other private mortgage insurers and the FHA; adoption of new or changes to existing laws and regulations or their enforcement and implementation by regulators; changes to the GSEs' role in the secondary mortgage market or other changes that could affect the residential mortgage industry generally or mortgage insurance in particular; potential future lawsuits, investigations or inquiries or resolution of current lawsuits or inquiries; emergence of unexpected claims and coverage issues, including claims exceeding our reserves or amounts we expected to experience; our ability to utilize our net operating loss carryforwards, which could be limited or eliminated in various ways, including if we experience an ownership change as defined in Section 382 of the Internal Revenue Code; and general economic downturns and volatility. These risks and uncertainties also include, but are not limited to, those set forth under the heading "Risk Factors" detailed in Item 1A of Part I of our Annual Report on Form 10-K for the year ended December 31, 2015, as subsequently updated through other reports we file with the SEC. All subsequent written and oral forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these cautionary statements. We caution you not to place undue reliance on any forward-looking statement, which speaks only as of the date on which it is made, and we undertake no obligation to publicly update or revise any forward-looking statement to reflect new information, future events or circumstances that occur after the date on which the statement is made or to reflect the occurrence of unanticipated events except as required by law.

Investor Contact
John M. Swenson
Vice President, Investor Relations and Treasury
[email protected]
(510) 788-8417

Press Contact
Mary McGarity
Strategic Vantage Mortgage Public Relations
(203) 513-2721
[email protected]


Consolidated statements of operations and comprehensive income		For the three months ended September 30,				For the nine months ended September 30,
		2016		2015		2016		2015
Revenues		(In Thousands, except for share data)
	Net premiums earned	$	31,808	$	12,834	$	77,656	$	28,626
	Net investment income		3,544		1,884		10,117		5,168
	Net realized investment gains (losses)		66		(15)		(758)		952
	Other revenues		102		-		172		-
Total revenues			35,520		14,703		87,187		34,746
Expenses
	Insurance claims and claims expenses		664		181		1,592		279
	Underwriting and operating expenses		24,037		19,653		69,943		58,912
Total expenses			24,701		19,834		71,535		59,191
Other (expense) income
	(Loss) gain from change in fair value of warrant liability		(797)		332		(187)		1,473
	Interest expense		(3,733)		-		(11,072)		-
Total other (expense) income			(4,530)		332		(11,259)		1,473

Income (loss) before income taxes			6,289		(4,799)		4,393		(22,972)
	Income tax expense		114		-		114		-
Net income (loss)		$	6,175	$	(4,799)	$	4,279	$	(22,972)

Earnings (loss) per share
	Basic	$	0.10	$	(0.08)	$	0.07	$	(0.39)
	Diluted	$	0.10	$	(0.08)	$	0.07	$	(0.39)

Weighted average common shares outstanding
Basic			59,130,401		58,741,328		59,047,758		58,650,043
Diluted			60,284,746		58,741,328		59,861,916		58,650,043

Loss Ratio⁽¹⁾			2%		1%		2%		1%
Expense Ratio⁽²⁾			76		153		90		206
Combined ratio			78%		155%		92%		207%

Net income (loss)		$	6,175	$	(4,799)	$	4,279	$	(22,972)
Other comprehensive income (loss), net of tax:
	Net unrealized gains (losses) in accumulated other comprehensive gain (loss), net of tax (benefit) expense of $0 for all periods presented		(82)		(483)		17,690		(15)
	Reclassification adjustment for losses (gains) included in net loss, net of tax expense of $0 for all periods presented		(66)		15		758		(952)
Other comprehensive income (loss), net of tax			(148)		(468)		18,448		(967)
Comprehensive income (loss)		$	6,027	$	(5,267)	$	22,727	$	(23,939)


⁽¹⁾	Loss ratio is calculated by dividing the provision for insurance claims and claims expenses by net premiums earned.
⁽²⁾	Expense ratio is calculated by dividing other underwriting and operating expenses by net premiums earned.


Consolidated balance sheets		September 30, 2016		December 31, 2015
Assets		(In Thousands, except for share data)
	Fixed maturities, available-for-sale, at fair value (amortized cost of $628,209 and $564,319 as of September 30, 2016 and December 31, 2015, respectively)	$	641,572	$	559,235
	Cash and cash equivalents		44,522		57,317
	Premiums receivable		11,378		5,143
	Accrued investment income		3,615		2,873
	Prepaid expenses		2,313		1,428
	Deferred policy acquisition costs, net		28,911		17,530
	Software and equipment, net		19,924		15,201
	Intangible assets and goodwill		3,634		3,634
	Prepaid reinsurance premiums		36,091		-
	Other assets		206		90
Total assets		$	792,166	$	662,451

Liabilities
	Term loan	$	144,230	$	143,939
	Unearned premiums		145,401		90,773
	Accounts payable and accrued expenses		32,568		22,725
	Reserve for insurance claims and claim expenses		2,133		679
	Reinsurance funds withheld		28,963		-
	Deferred ceding commission		6,697		-
	Warrant liability, at fair value		1,654		1,467
	Current tax payable		114		-
	Deferred tax		137		137
Total liabilities			361,897		259,720
Commitments and contingencies

Shareholders' equity
	Common stock - class A shares, $0.01 par value; 59,138,663 and 58,807,825 shares issued and outstanding as of September 30, 2016 and December 31, 2015, respectively (250,000,000 shares authorized)		591		588
	Additional paid-in capital		575,148		570,340
	Accumulated other comprehensive income (loss), net of tax		10,974		(7,474)
	Accumulated deficit		(156,444)		(160,723)
Total shareholders' equity			430,269		402,731
Total liabilities and shareholders' equity		$	792,166	$	662,451


Historical Quarterly Data		2016									2015

		September 30			June 30			March 31			December 31			September 30			June 30
Revenues		(In Thousands, except for share data)
	Net premiums earned	$	31,808		$	26,041		$	19,807		$	16,880		$	12,834		$	8,856
	Net investment income		3,544			3,342			3,231			2,078			1,884			1,688
	Net realized investment gains (losses)		66			61			(885	)		(121	)		(15	)		354
	Other revenues		102			37			32			25			-			-
Total revenues			35,520			29,481			22,185			18,862			14,703			10,898
Expenses
	Insurance claims and claims expenses		664			470			458			371			181			(6	)
	Underwriting and operating expenses		24,037			23,234			22,672			21,686			19,653			20,910
Total expenses			24,701			23,704			23,130			22,057			19,834			20,903

Other (expense) income ⁽¹⁾			(4,530	)		(3,766	)		(2,962	)		(1,626	)		332			(106	)

Income (loss) before income taxes			6,289			2,011			(3,907	)		(4,821	)		(4,799	)		(10,112	)
	Income tax expense (benefit)		114			-			-			-			-			241
Net income (loss)		$	6,175		$	2,011		$	(3,907	)	$	(4,821	)	$	(4,799	)	$	(10,353	)

Earnings (loss) per share
	Basic	$	0.10		$	0.03		$	(0.07	)	$	(0.08	)	$	(0.08	)	$	(0.18	)
	Diluted	$	0.10			0.03			(0.07	)		(0.08	)		(0.08	)		(0.18	)

Weighted average common shares outstanding
Basic			59,130,401			59,105,613			58,936,694			58,781,566			58,741,328			58,720,095
Diluted			60,284,746			59,830,899			58,936,694			58,781,566			58,741,328			58,720,095

Other data
Loss Ratio ⁽²⁾			2	%		2	%		2	%		2	%		1	%		-	%
Expense Ratio ⁽³⁾			76	%		89	%		114	%		128	%		153	%		236	%
Combined ratio			78	%		91	%		117	%		131	%		155	%		236	%


⁽¹⁾	Other (expense) income includes the gain from change in fair value of warrant liability, gain from settlement of warrants, and interest expense.
⁽²⁾	Loss ratio is calculated by dividing the provision for insurance claims and claims expenses by net premiums earned.
⁽³⁾	Expense ratio is calculated by dividing other underwriting and operating expenses by net premiums earned.

New Insurance Written (NIW), Insurance in Force (IIF) and Premiums
The tables below show primary and pool NIW and IIF, by quarter, for the last six quarters.


Primary NIW	Three months ended
		September 30, 2016		June 30, 2016		March 31, 2016		December 31, 2015		September 30, 2015		June 30, 2015
						(In Millions)
Monthly		$	4,162	$	3,700	$	2,492	$	2,029	$	1,582	$	1,460
Single			1,695		2,138		1,762		2,518		2,051		1,089
Primary		$	5,857	$	5,838	$	4,254	$	4,547	$	3,633	$	2,549

Primary and pool IIF	As of
		September 30, 2016		June 30, 2016		March 31, 2016		December 31, 2015		September 30, 2015		June 30, 2015
							(In Millions)
Monthly		$	16,038	$	12,529	$	9,210	$	6,958	$	5,087	$	3,617
Single			12,190		11,095		9,354		7,866		5,514		3,573
Primary			28,228		23,624		18,564		14,824		10,601		7,190

Pool			3,826		3,999		4,136		4,238		4,340		4,476
Total		$	32,054	$	27,623	$	22,700	$	19,062	$	14,941	$	11,666

Portfolio Statistics
The table below shows primary portfolio trends, by quarter, for the last six quarters.


Primary portfolio trends	As of and for the quarter ended
	September 30, 2016			June 30, 2016			March 31, 2016			December 31, 2015			September 30, 2015			June 30, 2015
	($ Values In Millions)
New insurance written	$	5,857		$	5,838		$	4,254		$	4,547		$	3,633		$	2,549
New risk written		1,415			1,411			1,016			1,105			887			615
Insurance in force ⁽¹⁾		28,228			23,624			18,564			14,824			10,601			7,190
Risk in force ⁽¹⁾		6,847			5,721			4,487			3,586			2,553			1,715
Policies in force (count) ⁽¹⁾		119,002			100,547			79,700			63,948			46,175			31,682
Weighted-average coverage ⁽²⁾		24.3	%		24.2	%		24.2	%		24.2	%		24.1	%		23.9	%
Loans in default (count)		115			79			55			36			20			9
Percentage of loans in default		0.1	%		0.1	%		0.1	%		0.1	%		-	%		-	%

Risk in force on defaulted loans	$	6		$	4		$	3		$	2		$	1		$	1
Average premium yield ⁽³⁾		0.48	%		0.47	%		0.45	%		0.49	%		0.52	%		0.51	%
Annual persistency ⁽⁴⁾		81.8	%		83.3	%		82.7	%		79.6	%		71.6	%		65.5	%


⁽¹⁾	Reported as of the end of the period.
⁽²⁾	End of period risk in force (RIF) divided by IIF.
⁽³⁾	Average premium yield is calculated by dividing primary net premiums earned, net of reinsurance, by average gross IIF for the period, annualized.
⁽⁴⁾	Defined as the percentage of IIF that remains on our books after any 12-month period.

The tables below reflect our total primary NIW by FICO, loan-to-value (LTV), and purchase/refinance mix.


Primary NIW by FICO				Three months ended
		September 30, 2016		June 30, 2016		September 30, 2015
					(In Millions)
	>= 760	$	2,975	$	3,160	$	1,755
	740-759		934		961		583
	720-739		725		672		505
	700-719		588		541		376
	680-699		387		308		271
	<= 679		248		196		143
Total		$	5,857	$	5,838	$	3,633


Primary NIW by LTV					Three months ended
			September 30, 2016		June 30, 2016		September 30, 2015
					(In Millions)
	95.01% and above	$	347	$	362	$	162
	90.01% to 95.00%		2,557		2,633		1,656
	85.01% to 90.00%		1,844		1,732		1,208
	85.00% and below		1,109		1,111		607
Total		$	5,857	$	5,838	$	3,633


Primary NIW by purchase/refinance mix					Three months ended
			September 30, 2016		June 30, 2016		September 30, 2015
					(In Millions)
	Purchase	$	4,400	$	4,199	$	2,604
	Refinance		1,457		1,639		1,029
Total		$	5,857	$	5,838	$	3,633

The tables below show the primary weighted average FICO and the weighted average LTV, by policy type, for NIW in the quarters presented.


Weighted Average FICO
	September 30, 2016		June 30, 2016		September 30, 2015
Monthly	748		752		742
Single	763		762		758


Weighted Average LTV
	September 30, 2016		June 30, 2016		September 30, 2015
Monthly	91	%	92	%	92	%
Single	90		91		91

The table below reflects a summary of our primary IIF and RIF by book year.


Primary IIF and RIF		As of September 30, 2016
		IIF		RIF
		(In Millions)
September 30, 2016	$	15,433	$	3,719
2015		10,679		2,610
2014		2,062		505
2013		54		13
Total	$	28,228	$	6,847

The tables below reflect our total primary IIF and RIF by FICO, average loan size, LTV, and loan type.


Primary IIF by FICO				As of
		September 30, 2016		June 30, 2016		September 30, 2015
				(In Millions)
	>= 760	$	14,258	$	11,929	$	4,969
	740-759		4,612		3,876		1,703
	720-739		3,648		3,082		1,582
	700-719		2,813		2,341		1,063
	680-699		1,863		1,561		848
	<=679		1,034		835		436
Total		$	28,228	$	23,624	$	10,601


Primary RIF by FICO					As of
		September 30, 2016		June 30, 2016		September 30, 2015
					(In Millions)
	>= 760	$	3,470	$	2,895	$	1,174
	740-759		1,130		951		413
	720-739		887		750		391
	700-719		680		566		260
	680-699		443		369		209
	<=679		237		190		106
Total		$	6,847	$	5,721	$	2,553


Primary Average Loan Size by FICO					As of
		September 30, 2016		June 30, 2016		September 30, 2015
					(In Thousands)
	>= 760	$	250	$	249	$	244
	740-759		240		239		234
	720-739		235		234		227
	700-719		233		232		225
	680-699		224		223		218
	<=679		209		209		207


Primary IIF by LTV						As of
			September 30, 2016			June 30, 2016			September 30, 2015
						(In Millions)
	95.01% and above		$	1,363		$	1,049		$	282
	90.01% to 95.00%			12,644			10,574			4,710
	85.01% to 90.00%			9,157			7,754			3,658
	85.00% and below			5,064			4,247			1,951
Total			$	28,228		$	23,624		$	10,601


Primary RIF by LTV						As of
			September 30, 2016			June 30, 2016			September 30, 2015
						(In Millions)
	95.01% and above		$	380		$	293		$	80
	90.01% to 95.00%			3,725			3,116			1,392
	85.01% to 90.00%			2,174			1,838			866
	85.00% and below			568			474			215
Total			$	6,847		$	5,721		$	2,553


Primary RIF by Loan Type						As of
			September 30, 2016			June 30, 2016			September 30, 2015

	Fixed			98	%		98	%		97	%
	Adjustable rate mortgages:
		Less than five years		-			-			-
		Five years and longer		2			2			3
Total				100	%		100	%		100	%

As of September 30, 2016 and September 30, 2015, 100% of each of our pool IIF and RIF was comprised of insurance on fixed rate mortgages.
The table below reflects a summary of the change in total primary IIF for the following periods.


Primary IIF				Three months ended
		September 30, 2016		June 30, 2016		September 30, 2015
				(In Millions)
IIF, beginning of period		$	23,624	$	18,564	$	7,190
	NIW		5,857		5,838		3,633
	Cancellations and other reductions		(1,253)		(778)		(222)
IIF, end of period		$	28,228	$	23,624	$	10,601

Geographic Dispersion
The following table shows the distribution by state of our primary RIF.


Top 10 primary RIF by state			As of
	September 30, 2016		June 30, 2016		September 30, 2015
California	13.2	%	13.0	%	13.2	%
Texas	6.8		6.8		7.1
Virginia	6.6		6.4		3.9
Florida	4.7		5.0		5.4
Colorado	4.0		4.1		4.3
Michigan	3.9		4.1		4.6
Arizona	3.8		3.8		3.6
Maryland	3.6		3.4		3.5
Pennsylvania	3.6		2.3		3.9
Utah	3.6		3.3		2.6
Total	53.8	%	52.2	%	52.1	%

The following table shows portfolio data by origination year.



	As of September 30, 2016
Origination year	Original Insurance Written		Remaining Insurance in Force		% Remaining of Original Insurance		Policies Ever in Force	Number of Policies in Force	Number of Loans in Default	# of Claims Paid	Incurred Loss Ratio (Inception to Date) ⁽¹⁾		Cumulative default rate ⁽²⁾
	($ Values in Millions)
2013	$	162	$	54	33	%	655	264	-	1	-	%	0.2	%
2014		3,451		2,062	60	%	14,786	9,824	46	2	2.7	%	0.3	%
2015		12,422		10,678	86	%	52,550	46,902	61	5	1.7	%	0.1	%

2016 (through September 30)		15,949		15,434	97	%	63,519	62,012	8	-	0.3	%	-	%
Total	$	31,984	$	28,228			131,510	119,002	115	8


⁽¹⁾	The ratio of total losses incurred (paid and reserved) divided by cumulative premiums earned, without the effects of reinsurance.
⁽²⁾	The sum of claims paid ever to date and notices of default as of the end of the period divided by policies ever in force.

The following table provides a reconciliation of the beginning and ending reserve balances for primary insurance claims and claims expenses:


			For the three months ended September 30,				For the nine months ended September 30,
			2016		2015		2016		2015
			(In Thousands)
Beginning balance			$	1,475	$	181	$	679	$	83
Less reinsurance recoverables ⁽¹⁾				-		-		-		-
Beginning balance, net of reinsurance recoverables				1,475		181		679		83

Add claims incurred:
	Claims and claim expenses incurred:
		Current year ⁽²⁾		690		219		1,803		358
		Prior years ⁽³⁾		(29)		(38)		(214)		(79)
Total claims and claims expenses incurred				661		181		1,589		279

Less claims paid:
	Claims and claim expenses paid:
		Current year ⁽²⁾		-		-		-		-
		Prior years ⁽³⁾		93		4		225		4
Total claims and claim expenses paid				93		4		225		4

Reserve at end of period, net of reinsurance recoverables				2,043		358		2,043		358
Add reinsurance recoverables ⁽¹⁾				90		-		90		-
Balance, September 30			$	2,133	$	358	$	2,133	$	358


⁽¹⁾	Related to ceded losses recoverable on the 2016 QSR Transaction. To date, ceded losses have been immaterial.
⁽²⁾	Related to defaults occurring in the current year.
⁽³⁾	Related to defaults occurring in prior years.

The following table provides a reconciliation of the beginning and ending count of loans in default.


	Three months ended				Nine months ended
	September 30,		September 30,		September 30,		September 30,
	2016		2015		2016		2015
Beginning default inventory	79		9		36		4
Plus: new defaults	69		21		158		24
Less: cures	(30	)	(9	)	(73	)	(7	)
Less: claims paid	(3	)	(1	)	(6	)	(1	)
Ending default inventory	115		20		115		20

The following tables provide details of our claims and reserves.

	Three months ended						Nine months ended
	September 30,			September 30,			September 30,			September 30,
	2016			2015			2016			2015
	($ Values In Thousands)
Number of claims paid		3			1			6			1
Total amount paid for claims	$	93		$	4		$	225		$	4
Average amount paid per claim	$	31		$	4		$	32		$	4
Severity		53	%		5	%		62	%		5	%


Average reserve per default:	As of September 30, 2016		As of September 30, 2015
	(In Thousands)
Case	$	17	$	17
IBNR		1		1
Total	$	18	$	18

The following table provides a comparison of the PMIERs financial requirements as reported by National MI.


			As of
	September 30, 2016		June 30, 2016		December 31, 2015
	(In thousands)
Available Assets	$	488,635	$	432,074	$	431,411
Net Risk-Based Required Assets		320,609		377,468		249,805

Asset charge % ⁽¹⁾		6.14%		6.10%		6.17%

⁽¹⁾	Asset charge represents the risk based required asset amount as defined in the PMIERs, divided by the outstanding RIF on performing primary loans.

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NMI Holdings, Inc. Reports Record Third Quarter Net Income of $6.2 Million

NMI Holdings, Inc. Reports Record Third Quarter Net Income of $6.2 Million