CMHC Releases First Quarter Results

Canada Mortgage and Housing Corporation (CMHC) released today its first quarter financial report as well as complementary Mortgage Loan Insurance and Securitization Business Supplements.

CMHC provides mortgage loan insurance and securitization guarantee programs to facilitate access to mortgage financing and to contribute to the stability of the financial system. Consistent with our mandate, CMHC is present in all markets and through all economic cycles. During the first quarter, CMHC provided mortgage loan insurance for over 50,000 units across the country. Ensuring overall portfolio quality through prudent underwriting reduces the risk associated with the mortgage loan insurance business. An average credit score of 746 for transactional homeowner loans and an average gross debt service (GDS) ratio of

26.0% for the three-month period ended March 31, 2015 demonstrate a strong ability among homebuyers with CMHCinsured mortgages to manage their debts. The average insured loan amount for transactional homeowner mortgages in the quarter was $238,630.

The strength of CMHC’s portfolio is reflected in the overall arrears rate which was 0.34% as at 31 March 2015 while Claims Paid decreased $9 million (8.8%) from the same quarter last year. The total number of loans in arrears decreased slightly (1.4%) compared to year-end 2014.

CMHC has a legislated limit of $600 billion of insurance-in-force. During the first quarter, total insurance-in-force decreased by $4 billion to $539 billion. CMHC expects insurance-in-force to decline gradually as normal mortgage repayments continue to offset new insurance written.

CMHC’s securitization guarantee products facilitate access to funds for residential mortgage financing. New securities guaranteed in the first quarter were $23 billion. For 2015, the Minister of Finance has authorized CMHC to provide up to $80 billion for new guarantees of market NHA MBS and up to $40 billion of new guarantees for CMB.

CMHC’s mortgage loan insurance and securitization guarantee programs operate on a commercial basis without support from Canadian taxpayers. During the quarter, CMHC generated $332 million in net income from these activities. Total CMHC net income was $342 million for the quarter.

CMHC works closely with provinces, territories and housing providers, including First Nations, to help low-income Canadians access affordable, better quality housing off- and on-reserve. For the three-month period ended March 31, 2015 CMHC provided more than $630 million for housing programs on behalf of the Government of Canada.

To further enhance transparency and expand the availability of data, CMHC has also published for the first time a Securitization Business Supplement. This complements the Mortgage Loan Insurance Business Supplement that the Corporation began publishing last year.

These files contain a range of statistics and data on CMHC’s commercial activities and help readers better understand the business undertaken by CMHC. The supplements provide meaningful insight and provide market participants with data that will allow them to better analyze our activities in the Canadian housing market. Both supplements will continue to be released quarterly.

CMHC helps Canadians meet their housing needs. As Canada’s authority on housing, we contribute to the stability of the housing market and financial system, provide support for Canadians in housing need, and offer objective housing research and advice to Canadian governments, consumers and the housing industry. Prudent risk management, strong corporate governance and transparency are cornerstones of our operations.

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