CMHC Releases 2016 First Quarter Results
May 30 2016 Posted by Tracy Bennett
Canada Mortgage and Housing Corporation (CMHC) released its first quarter financial results today as well as supplemental data on the Corporation’s Mortgage Loan Insurance, Securitization, and Covered Bonds business activities.
CMHC’s mortgage loan insurance and securitization guarantee programs facilitate access to mortgage financing and contribute to the stability of the financial system. These programs operate on a commercial basis without support from Canadian taxpayers. During the quarter, CMHC generated $313 million in net income from these activities.
- During the first quarter, CMHC provided mortgage loan insurance for over 83,000 units across the country.
- Total insurance-in-force was $520 billion as at March 31, 2016, a $6 billion decrease from year-end 2015. CMHC has a legislated insurance-in-force limit of $600 billion.
- The average insured loan amount for transactional homeowner mortgages in the quarter was $238,632.
- Homebuyers with CMHC-insured mortgages have a strong ability to manage their debts as evidenced by an average credit score of 747 for transactional homeowner loans and an average gross debt service (GDS) ratio of 25.8% for the three-months ended March 31, 2016.
- The strength of CMHC’s portfolio is reflected in the overall arrears rate which, as at March 31, 2016, stood at 0.34%. Nationally, CMHC’s arrears rate has remained relatively stable; although there has been a small increase in arrears in Alberta and Saskatchewan. CMHC’s presence in all markets means that it has a diversified national portfolio of insurance-in-force. As a result, the increase in regional arrears is not expected to have a material impact on CMHC’s net income going forward.
- New securities guaranteed for the first quarter were $21.8 billion, comprised of $12.6 billion for market NHA MBS and $9.2 billion for CMB. CMHC’s total guarantees-in-force were $429 billion as at the end of the first quarter 2016.
Subsequent to quarter’s end, Fort McMurray, Alberta was affected by wildfires. CMHC has provided lenders with a number of options to support CMHC-insured homeowners touched by these unfortunate events. Claim losses to CMHC are not expected to be significant as lenders work directly with borrowers to address any required repairs, recoup losses under existing property insurance policies and access any disaster relief, emergency funds and/or other assistance as available and appropriate. Additional background information on the impact of the Fort McMurray fires can be found at the end of this Release.
CMHC also works closely with provinces, territories and housing providers, including First Nations, to help low-income Canadians access affordable, better quality housing. For the three-month period ended March 31, 2016 CMHC provided more than $589 million for housing programs on behalf of the Government of Canada.
The Quarterly Financial Report and supporting business supplements are available online.
CMHC’s Mortgage Loan Insurance, Securitization and Covered Bond business supplements offer additional data on CMHC’s commercial activities to help readers better understand our business.
Canada Mortgage and Housing Corporation (CMHC) has been Canada's national housing agency for almost 70 years.
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 information to Canadian governments, consumers and the housing industry. Prudent risk management, strong corporate governance and transparency are cornerstones of our operations.