When the Canada Mortgage and Housing Corporation moved to tighten its underwriting practices last summer, it was the largest provider of mortgage insurance in the country, capturing 49 per cent of new business in the second quarter.
“There is no doubt that we have willingly chosen to forgo some profitable business that our competitors would find appealing,” then-chief executive Evan Siddall wrote in August, in a letter to Canada’s biggest lenders, following the implementation of the stricter standards. Siddall used the letter to caution the banks and others mortgage lenders about risky lending, warning that “there is a dark economic underbelly to this business that I want to expose.”
Instead, the CMHC saw its market share of new insurance originations plummet, dropping the Crown Corporation all the way to third place, behind private insurers Sagen and Canada Guaranty. In the first quarter of 2021, the CMHC held just a 23 per cent share of new underwritings, according to figures calculated by RBC Capital Markets. Sagen (formerly known as Genworth Financial) held 44 per cent of the pie, followed by Canada Guaranty with 33 per cent.
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