From CBA this AM:
Genworth’s Australian mortgage insurer unit returned to profitability in Q2, reporting NI of $44m compared to a loss of $21m in Q1 and a profit of $54m a year ago. This should provide the market with some sense that its Q1 shock loss was driven mainly from the significant reserve build that resulted from Queensland floods. Claims that followed were in line with reserves. Genworth calculated that the overall delinquency rate at its Australian unit had improved 2bps sequentially to 52bps. Genworth has 23% of its primary risk in force in Queensland where delinquency rates are 76bps (an improvement of 4bps compared to Q1) vs NSW at 50bps ( 3bps), VIC at 36bps ( 1bps), and WA 52bps ( 5bps). Portfolio seasoning was driving stabilisation in delinquency trends but remain elevated, albeit stable. There remain pressured segments, such as the 2007/2008 vintage small business and self employed. Genworth anticipates a modest decline in delinquency inventory in the December half year.
