Amerin Reports Strong Third Quarter Earnings.CHICAGO--(BUSINESS WIRE)--Oct. 21, 1997--Amerin Corporation (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : AMRN), the parent of Amerin Guaranty As a verb, to agree to be responsible for the payment of another's debt or the performance of another's duty, liability, or obligation if that person does not perform as he or she is legally obligated to do; to assume the responsibility of a guarantor; to warrant. , today reported net income of $10.5 million, or $.40 per share, for the third quarter of 1997, an increase of 39 percent from $7.6 million a year ago and a 38 percent improvement from $.29 per share last year. Revenues for the third quarter were $28.8 million, up 37 percent from $21.0 million last year. Net premiums earned were $24.0 million, an increase of 44 percent compared with a year ago's $16.7 million. Investment income was $4.7 million, up from $4.3 million from last year's third quarter. For the first nine months of 1997, Amerin earned $28.9 million, or $1.09 per share, up from $20.0 million, or $0.76 per share last year, increases of 45 percent and 43 percent, respectively. Total revenues for that period were $80.2 million versus $55.8 million, an increase of 44 percent. Net premiums earned increased by 52 percent to $66.4 million from last year's $43.6 million. Net investment income grew to $13.8 million, up from $12.4 million in the same period last year. New insurance written in the third quarter was $2.1 billion, compared with $2.0 billion a year ago. On a nine-month basis, new insurance written was $5.8 billion, down slightly from a year ago's $6.0 billion. As of Sept. 30, 1997, Amerin's insurance in force stood at $19.2 billion, an increase of $4.4 billion from Dec. 31, 1996 and a gain of 43 percent from a year ago. Persistency, or the percentage of insurance remaining in force from one year prior, was 88.2 percent at Sept. 30, 1997. It was 87.6 percent at Dec. 31, 1996 and 86.8 percent at Sept. 30, 1996. Amerin's loss ratio was 32.0 percent in the third quarter, down from last year's 33.5 percent. The quarterly expense ratio increased slightly to 25.8 percent from last year's 24.5 percent. The combined ratio for the third quarter was 57.8 percent, down slightly from a year ago's 58.0 percent. The quarterly delinquency delinquency Criminal behaviour carried out by a juvenile. Young males make up the bulk of the delinquent population (about 80% in the U.S.) in all countries in which the behaviour is reported. rate was 1.28 percent, up from 1.22 percent at the end of the second quarter. Commenting on the results, Amerin Chairman and Chief Executive Officer Gerald Gerald - ["Gerald: An Exceptional Lazy Functional Programming Language", A.C. Reeves et al, in Functional Programming, Glasgow 1989, K. Davis et al eds, Springer 1990]. L. Friedman Fried·man , Milton Born 1912. American economist. He won a 1976 Nobel Prize for his theories of monetary control and governmental nonintervention in the economy. Noun 1. said: "Amerin's strong earnings growth continued in the third quarter, despite an extremely competitive market. Lower than anticipated losses was one of the factors fueling this growth. From a new business perspective, volume was up slightly in the quarter, and we expect to see a slight decline in market share for the period. The reason: capital consumptive con·sump·tive adj. Of, relating to, or afflicted with consumption. GSE GSE general somatic efferent system. pool deals and expensive contract underwriting Underwriting 1. The process by which investment bankers raise investment capital from investors on behalf of corporations and governments that are issuing securities (both equity and debt). 2. The process of issuing insurance policies. arrangements are appealing to lenders' needs to improve short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. earnings, driving increased levels of new business to those mortgage insurers that are aggressively providing these benefits. The question is: will these programs be sustainable for mortgage insurers? Long term, we believe that major lenders will realize that captive captive said of naturally wild or feral animals kept in captivity for educational and scientific investigation with no attempt being made to domesticate them. mortgage reinsurance The contract made between an insurance company and a third party to protect the insurance company from losses. The contract provides for the third party to pay for the loss sustained by the insurance company when the company makes a payment on the original contract. structures provide a more sustainable, reliable solution for profitability. As the industry's dominant captive provider, Amerin is confident that it is strategically well-positioned for new business growth in 1998." Amerin provides private mortgage insurance to leading mortgage originators. The company's products are discount Borrower-Paid Mortgage Insurance and Lender-Paid Mortgage Insurance. Amerin's approach to sales and underwriting reduces the cost of its insurance and offers operating efficiencies to mortgage lenders and their borrowers. Home buyers who make down payments of less than 20 percent of the value of the home are usually required by the mortgage lender LENDER, contracts. He from whom a thing is borrowed. 2. The contract of loan confers rights, and imposes duties on the lender. 1. The lender has the right to revoke the loan at his mere pleasure; 9 Cowen, R. 687; 8 Johns. Rep. 432; 1 T. R. 480; 2 Campb. Rep. to qualify and pay for mortgage insurance on their mortgage loans. If the homeowner defaults on the loan, mortgage insurance pays the lender or the owner of the loan for its losses up to a specified coverage amount. The following is a "Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. " Statement under the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995: The statements contained in this release that are not historical facts are forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. . Actual results may differ materially from those projected in the forward-looking statements. These forward-looking statements involve risks and uncertainties, including but not limited to, the following risks: that interest rates may increase rather than remain stable or decrease; that housing demand may decrease for any number of reasons, including changes in interest rates, adverse economic conditions, or other reasons; that Amerin's market share may decrease as a result of changes in underwriting criteria criteria (krītēr´ē  ),n. by Amerin or its competitors COMPETITORS, French law. Persons who compete or aspire to the same office, rank or employment. As an English word in common use, it has a much wider application. Ferriere, Dict. de Dr. h.t. , or other reasons; and changes in the performance of the financial markets, in the demand for and market acceptance of Amerin products, and in general economic conditions. Investors are also directed to other risks discussed in documents filed by the Company with the Securities and Exchange Commission. -0-
Amerin Corporation and Subsidiaries
Consolidated Statement of Operations
Dollars in thousands,
except per share amounts. Three Months Ended Nine Months Ended
Sept. 30, Sept. 30,
1997 1996 1997 1996
Revenues:
Net premiums written $26,241 $20,552 $68,578 $49,988
Increase in unearned
premiums (2,240) ins
(losses) 77 88 62 (133)
Total revenues 28,7ition costs 2,629 2,009 7,923 6es 14,66
6 10,680
40,3
42 27,882standing 26,643.4 26,351.0 26e ratio 25.8% 24.5%
26.0%
27.7%
Combined ratio 57.8% 58.0% nded Nine Months Ended
Dollars in millions. as a % of NIW:
95% LTV rage 44.3% 44.8% 45.0% 46.2%
Monthly premium 84.2% 85.7% 87.4% 85.5%
Refinances 11.7% 9.6% 12.7% 17.7%
Net premiums written (dollars
in thousands) (2):
New business $3,588 $4,184 $8,244 $10,776
Renewals 22,653 16,368 60,334 39,212
(1) Operating ratios presented are on the basis of statutory
accounting practices and reflect the combined results of Amerin's
insurance company subsidiaries and do not include holding company
costs.
recorded as
Renewals.
-0-
Amerin Corporation and Subsidiari. 31, Sept. 30,
4,368 3,953
Goodwill, net of accumulated
amortization 2,170 2,282 2,319
Other assets 8,693 $354,824 $335,275
Liabilities and Common1.53 $11.09
(1) Investments include
16.0 13.3 12.3
Insur 1,174
Default rate 1.28INGS
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