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- Insurer Genworth Mortgage announced today it has renewed a supply and service contract with Commonwealth Bank
- This ongoing contract attributed to over half of Genworth’s gross written premium during the first half of this year
- The contract will be active until the end of December 2022 as Genworth continues to be Commonwealth’s exclusive provider of lenders mortgage insurance
- Genworth also announced net profits today of $25 million for the third quarter of this year, as Chief Executive Georgette steps down after eight years with the company
- Shares in the company gained 10.9 per cent today, to trade at $3.97 each.
Genworth Mortgage Insurance has ticked multiple boxes today, announcing healthy net profits and extending business with Commonwealth Bank.
The company will continue to be Commonwealth Bank’s exclusive provider of lenders mortgage insurance (LMI) until the end of December 2022.
This ongoing partnership with Commonwealth attributed to 53 per cent of Genworth’s gross written premium during the first half of this year.
“We are delighted that our long-standing relationship with [Commonwealth] has been extended for another three years,” Genworth Chief Executive Georgette Nicholas said.
“The renewal is evidence of the broader demand by lenders for our risk and capital management solutions.”
As part of the contract extension, Genworth will be committed to a minimum fixed volume of LMI accounts going into Commonwealth’s portfolio.
“Importantly, the agreement opens further opportunities to expand our relationship through continued investment in technology, product offerings and services that provide a better borrower experience,” Georgette added.
“For our shareholders, the new [commonwealth] contract is on terms which meet our pricing return on equity profile and risk appetite.”
Commonwealth Executive General Manager of Home Buying Dan Huggins added his comments on the extended business in Genworth’s media release today.
“We look forward to continuing our long-standing relationship with Genworth,” he said.
“As a leading provider of risk and capital management solutions in residential mortgage markets, Genworth plays an important role in helping the Commonwealth Bank meet the home buying needs of our customers.”
Dividends for loyal investors dished out
Today Genworth released its latest quarterly roundup as well, revealing a recorded net profit of $25.1 million.
This result is a strong 28 per cent increase from this time last year of $19.6 million.
Genworth announced it will be handing out a special dividend of 24.2 cents per share as a result.
During a day of impressive results, today is also a day of change at Genworth.
Georgette Nicholas has completed her last day as acting Chief Executive and Managing Director of Genworth, as announced earlier this year in May. She joined Genworth as a Technical Advisor in October of 2005.
She is replaced by the company’s Non-Executive Director, Duncan West. Duncan has extensive insurance industry experience and will serve as Chief Executive at the beginning of January next year and onwards.
Georgette will remain with the company until the end of March next year to assist in the transition period.
“Georgette has left Genworth in a strong position to compete and grow over the next phase of our strategic journey,” Genworth Chairman Ian MacDonald said today.
“We thank her for her commitment to the company over the past five years and the investment she has made in positioning Genworth for future success,”
Shares in Genworth today jumped a solid 10.9 per cent to trade at $3.97 per share.
Meanwhile, Commonwealth’s shares on the market dropped 0.79 per cent, valuing shares at $79.83 each.
