2.75% of Essent Loans Delinquent in Third Quarter as Net Income Reaches $163.4 Million
Key Facts
Essent Group said on November 6, 2026, that the share of delinquent loans in its mortgage insurance portfolio rose to 2.75% in the third quarter, from 2.53% in the previous quarter and 2.29% a year earlier. Net income for the period ended September 30 was $163.4 million, or $1.82 a diluted share, compared with $164.2 million and $1.67 a share a year earlier. Revenue, meanwhile, reached $374.183 million, versus $311.830 million in the third quarter of 2025. The company said its results reflected its insurance and reinsurance businesses, while market data showed the stock closed at $63.41 in the November 6 session. The report comes as delinquency and loss indicators in the portfolio rise, alongside revenue growth and an annual improvement in earnings per share.
Earnings per share of $1.82 came in below analysts' estimate of $1.85 by $0.03, according to Investing.com. Revenue of $374.18 million, however, exceeded the consensus estimate of $339.21 million. Earnings per share rose from a year earlier despite net income declining from $164.215 million to $163.376 million, according to detailed figures in the company's filing. On the expense side, loss provisions and claim settlement expenses increased to $83.489 million from $44.922 million a year earlier. Other underwriting and operating expenses also rose to $83.490 million, versus $59.498 million in the comparable period.
The portfolio had 21,919 delinquent loans at the end of September, up from 18,583 a year earlier. During the quarter, Essent recorded 12,034 new delinquencies, while 9,869 cases were cured or returned to current status, leaving the quarter-end inventory cited above. The company defines a delinquent loan as one on which the borrower has missed two consecutive payments. Loss reserves rose to $585 million from $519 million in the second quarter and $397 million in the third quarter of 2025. Essent said the delinquency rate at mortgage insurers tends to be positively correlated with the U.S. unemployment rate.
For new business, mortgage insurance written totaled $12.1 billion in the third quarter, compared with $14.1 billion in the second quarter and $12.2 billion a year earlier. The portfolio of insurance in force remained at $250.1 billion on September 30, versus $249.7 billion on June 30 and $248.8 billion a year earlier. In its results presentation, the company said portfolio growth remains limited as housing affordability continues to affect loan originations. It added that demographic factors and pent-up demand could support the housing market over the long term. Essent Guaranty's available assets exceeded the regulatory minimum by $1.616 billion, equivalent to 77% of required assets.
The annualized return on equity fell to 11.7% in the third quarter from 13.4% in the second quarter, while the mortgage insurance loss ratio rose to 39.6% from 28.4%. The indicators reflect quarterly returns declining as claims and expenses rose as a share of premiums, alongside an increase in loss provisions. Chief Executive Mark Casale said the credit quality of the in-force portfolio and the company's strong capital position give it flexibility to invest and return capital to shareholders. He added: "We are well positioned." The official filing did not link the buyback authorization to a goal of supporting the market value.
The company declared a quarterly cash dividend of $0.35 a share, payable on December 10 to shareholders of record on December 1, 2026. The board also approved a new $500 million share repurchase authorization in November, effective through the end of 2028. The company had repurchased 7.7 million shares for $474 million through October 31, 2026. Essent said on October 16 that an earnings call would be held on November 6 at 10:00 a.m. Eastern time, and it took place as scheduled. In its presentation, the company linked delinquency trends to factors including unemployment and said housing affordability affects loan originations.