What changed in this filing

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Item 1. Financial Statements

2025-11-05 compared with 2025-07-30 · 132 added, 140 removed, 618 unchanged (31% of the section changed)

8 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

Assets (In Thousands, except for share data)

22 unchanged sentences

Common stock - $ 0.01 par value;

88,365,509 shares issued and 77,717,841 shares outstanding as of June 30, 2025 and 87,902,626 shares issued and 78,600,726 shares outstanding as of December 31, 2024 ( 250,000,000 shares authorized)

88,371,465 shares issued and 77,095,871 shares outstanding as of September 30, 2025 and 87,902,626 shares issued and 78,600,726 shares outstanding as of December 31, 2024 ( 250,000,000 shares authorized)

Additional paid-in capital 1,010,550 1,004,692

Treasury Stock, at cost:

10,647,668 and 9,301,900 common shares as of June 30, 2025 and December 31, 2024, respectively

11,275,594 and 9,301,900 common shares as of September 30, 2025 and December 31, 2024, respectively

( 320,877 ) ( 246,594 )

6 unchanged sentences

C ONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (UNAUDITED)

For the three months ended June 30, For the six months ended June 30,

For the three months ended September 30, For the nine months ended September 30,

2025 2024 2025 2024

2 unchanged sentences

Net investment income 26,773 22,474 75,408 62,598

Net realized investment losses ( 400 ) — ( 376 ) —

Net realized investment gains (losses) 321 ( 10 ) ( 55 ) ( 10 )

Other revenues 262 285 596 711

15 unchanged sentences

Net income $ 95,999 $ 92,810 $ 294,709 $ 273,939

Other comprehensive income (loss), net of tax:

Unrealized gains (losses) in accumulated other comprehensive loss, net of tax expense (benefit) of $ 5,570 and $( 412 ) for the three months ended June 30, 2025 and 2024, and $ 13,756 and $( 3,141 ) for the six months ended June 30, 2025 and 2024, respectively

Other comprehensive income, net of tax:

Unrealized gains in accumulated other comprehensive loss, net of tax expense of $ 5,145 and $ 18,441 for the three months ended September 30, 2025 and 2024, and $ 18,901 and $ 15,300 for the nine months ended September 30, 2025 and 2024, respectively

19,356 69,372 71,106 57,918

Reclassification adjustment for realized losses included in net income, net of tax benefit of $ 84 and $ 79 for the three and six months ended June 30, 2025, respectively

Other comprehensive income (loss), net of tax 21,271 ( 1,549 ) 52,047 ( 11,454 )

Reclassification adjustment for realized (gains) losses included in net income, net of tax expense (benefit) of $ 67 and $( 2 ) for the three months ended September 30, 2025 and 2024, and $( 12 ) and $( 2 ) for the nine months ended September 30, 2025 and 2024, respectively

( 253 ) 8 44 8

Other comprehensive income, net of tax 19,103 69,380 71,150 57,926

Comprehensive income $ 115,102 $ 162,190 $ 365,859 $ 331,865

1 unchanged sentence

NMI HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (UNAUDITED)

C ONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (UNAUDITED)

Common Stock Additional

19 unchanged sentences

Balances, June 30, 2025 77,717 $ 884 $ 1,006,058 $ ( 296,047 ) $ ( 72,757 ) $ 1,781,969 $ 2,420,107

Common stock:

shares issued under stock plans, net of shares withheld for employee taxes 6 * ( 12 ) — — — ( 12 )

Repurchase of common stock ( 628 ) — — ( 24,830 ) — — ( 24,830 )

Share-based compensation expense — — 4,504 — — — 4,504

Change in unrealized investment gains/losses, net of tax expense of $ 5,078

— — — — 19,103 — 19,103

Net income — — — — — 95,999 95,999

Balances, September 30, 2025 77,095 $ 884 $ 1,010,550 $ ( 320,877 ) $ ( 53,654 ) $ 1,877,968 $ 2,514,871

* During the three months ended September 30, 2025, we issued 5,956 common shares with a par value of $ 0.01 in connection with the exercise of options and vesting of restricted stock units granted under our stock plans, which is not identifiable in this schedule due to rounding.

See accompanying notes to condensed consolidated financial statements (unaudited).

22 unchanged sentences

Balances, June 30, 2024 79,764 $ 879 $ 993,143 $ ( 201,323 ) $ ( 151,371 ) $ 1,404,282 $ 2,045,610

Common stock:

shares issued under stock plans, net of shares withheld for employee taxes * * ( 12 ) — — — ( 12 )

Repurchase of common stock ( 443 ) — — ( 17,041 ) — — ( 17,041 )

Share-based compensation expense — — 4,439 — — — 4,439

Change in unrealized investment gains/losses, net of tax expense of $ 18,443

— — — — 69,380 — 69,380

Net income — — — — — 92,810 92,810

Balances, September 30, 2024 79,321 $ 879 $ 997,570 $ ( 218,364 ) $ ( 81,991 ) $ 1,497,092 $ 2,195,186

* During the three months ended September 30, 2024, we issued 337 common shares with a par value of $ 0.01 in connection with the exercise of options and vesting of restricted stock units granted under our stock plans, which is not identifiable in this schedule due to rounding.

See accompanying notes to condensed consolidated financial statements (unaudited).

1 unchanged sentence

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

For the six months ended June 30,

For the nine months ended September 30,

Cash flows from operating activities (In Thousands)

3 unchanged sentences

Depreciation and amortization 8,564 8,970

Net (accretion)/amortization of (discount)/premium on investment securities ( 1,634 ) 785

Net accretion of discount on investment securities ( 3,036 ) ( 229 )

Loss on extinguishment of debt — 6,966

29 unchanged sentences

Net cash used in financing activities ( 82,615 ) ( 67,997 )

Net increase (decrease) in cash, cash equivalents and restricted cash 29,705 ( 34,060 )

Net increase in cash, cash equivalents and restricted cash 76,131 36,630

Cash, cash equivalents and restricted cash, beginning of period 54,308 96,689

41 unchanged sentences

We are currently evaluating the impact the adoption of this ASU will have, if any, on our consolidated financial statements.

In September 2025, the FASB issued ASU 2025-06, Targeted Accounting for Internal-Use Software (Topic 350).

The update clarifies the criteria surrounding the capitalization of certain costs and expands related disclosure requirements.

The standard will take effect for all public business entities for annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods.

Early adoption is permitted.

We are currently evaluating the impact the adoption of this ASU will have, if any, on our consolidated financial statements.

NMI HOLDINGS, INC.

7 unchanged sentences

Cost Gross Unrealized Fair

As of June 30, 2025 (In Thousands)

As of September 30, 2025 (In Thousands)

Treasury securities and obligations of U.S.

16 unchanged sentences

Total investments $ 2,876,343 $ 5,820 $ ( 158,622 ) $ 2,723,541

We did not own any mortgage-backed securities in our asset-backed securities portfolio at June 30, 2025 or December 31, 2024.

We did not own any mortgage-backed securities in our asset-backed securities portfolio at September 30, 2025 or December 31, 2024.

NMI HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

The following table presents a breakdown of the fair value of our corporate debt securities by issuer industry group as of June 30, 2025 and December 31, 2024:

June 30, 2025 December 31, 2024

The following table presents a breakdown of the fair value of our corporate debt securities by issuer industry group as of September 30, 2025 and December 31, 2024:

September 30, 2025 December 31, 2024

Financial 39 % 40 %

2 unchanged sentences

Industrial 9 9

Technology 6 7

Communications 6 7

Technology 6 7

Basic materials 1 —

Total 100 % 100 %

As of June 30, 2025 and December 31, 2024, approximately $ 5.4 million and $ 5.3 million, respectively, of our cash and investments were held in the form of U.S.

As of September 30, 2025 and December 31, 2024, approximately $ 5.4 million and $ 5.3 million, respectively, of our cash and investments were held in the form of U.S.

Treasury securities on deposit with various state insurance departments to satisfy regulatory requirements.

Scheduled Maturities

The amortized cost and fair value of available-for-sale securities as of June 30, 2025 and December 31, 2024, by contractual maturity, are shown below.

The amortized cost and fair value of available-for-sale securities as of September 30, 2025 and December 31, 2024, by contractual maturity, are shown below.

Expected maturities will differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.

Because most asset-backed securities provide for periodic payments throughout their lives, they are listed below in a separate category.

As of June 30, 2025 Amortized

As of September 30, 2025 Amortized

(In Thousands)

14 unchanged sentences

Aging of Unrealized Losses

As of June 30, 2025, the investment portfolio had gross unrealized losses of $ 109.9 million, of which $ 108.5 million were associated with securities that had been in an unrealized loss position for a period of twelve months or longer.

As of September 30, 2025, the investment portfolio had gross unrealized losses of $ 95.5 million, of which $ 95.1 million were associated with securities that had been in an unrealized loss position for a period of twelve months or longer.

As of December 31, 2024, the investment portfolio had gross unrealized losses of $ 158.6 million, of which $ 150.8 million were associated with securities that had been in an unrealized loss position for a period of twelve months or longer.

4 unchanged sentences

# of Securities Fair Value Unrealized Losses # of Securities Fair Value Unrealized Losses # of Securities Fair Value Unrealized Losses

As of June 30, 2025 ($ In Thousands)

As of September 30, 2025 ($ In Thousands)

Treasury securities and obligations of U.S.

17 unchanged sentences

Allowance for Credit Losses

As of June 30, 2025 and December 31, 2024, we did not recognize an allowance for credit loss for any security in the investment portfolio and we did not record any provision for credit loss for investment securities during the three or six months ended June 30, 2025 or 2024.

We evaluated the securities in an unrealized loss position as of June 30, 2025, assessing their credit ratings as well as any adverse conditions specifically related to the security.

Based upon our assessment of the amount and timing of cash flows to be collected over the remaining life of each instrument, we believe the unrealized losses as of June 30, 2025 are not indicative of the ultimate collectability of the current amortized cost of the securities.

Rather, the unrealized losses on securities held as of June 30, 2025 were primarily driven by fluctuations in interest rates, and to a lesser extent, movements in credit spreads following the purchase of those securities.

As of September 30, 2025 and December 31, 2024, we did not recognize an allowance for credit loss for any security in the investment portfolio and we did not record any provision for credit loss for investment securities during the three or nine months ended September 30, 2025 or 2024.

We evaluated the securities in an unrealized loss position as of September 30, 2025, assessing their credit ratings as well as any adverse conditions specifically related to the security.

Based upon our assessment of the amount and timing of cash flows to be collected over the remaining life of each instrument, we believe the unrealized losses as of September 30, 2025 are not indicative of the ultimate collectability of the current amortized cost of the securities.

Rather, the unrealized losses on securities held as of September 30, 2025 were primarily driven by fluctuations in interest rates, and to a lesser extent, movements in credit spreads following the purchase of those securities.

Net Investment Income

The following table presents the components of net investment income:

For the three months ended June 30, For the six months ended June 30,

For the three months ended September 30, For the nine months ended September 30,

2025 2024 2025 2024

4 unchanged sentences

Net investment income $ 26,773 $ 22,474 $ 75,408 $ 62,598

(1) Includes interest income recognized on cash and cash equivalents of $ 1.1 million and $ 2.0 million during the three and six months ended June 30, 2025, respectively, and $ 1.8 million and $ 2.9 million during the three and six months ended June 30, 2024, respectively.

(1) Includes interest income recognized on cash and cash equivalents of $ 0.9 million and $ 2.9 million during the three and nine months ended September 30, 2025, respectively, and $ 1.3 million and $ 4.2 million during the three and nine months ended September 30, 2024, respectively.

NMI HOLDINGS, INC.

1 unchanged sentence

The following table presents the components of net realized investment gains (losses):

For the three months ended June 30, For the six months ended June 30,

For the three months ended September 30, For the nine months ended September 30,

2025 2024 2025 2024

42 unchanged sentences

(Level 3) Fair Value

As of June 30, 2025 (In Thousands)

As of September 30, 2025 (In Thousands)

Treasury securities and obligations of U.S.

21 unchanged sentences

Total assets $ 252,984 $ 2,524,865 $ — $ 2,777,849

There were no transfers between Level 2 and Level 3 of the fair value hierarchy during the six months ended June 30, 2025 or the year ended December 31, 2024.

There were no transfers between Level 2 and Level 3 of the fair value hierarchy during the nine months ended September 30, 2025 or the year ended December 31, 2024.

Financial Instruments Not Measured at Fair Value

1 unchanged sentence

Proceeds from the 2024 Notes offering were primarily used to repay our then outstanding $ 400 million senior secured notes (the 2020 Notes).

At June 30, 2025, the 2024 Notes were carried at a cost of $ 416.1 million, net of unamortized debt issuance costs and an original issue discount totaling $ 8.9 million, and had a fair value of $ 437.2 million as assessed under our Level 2 hierarchy.

At September 30, 2025, the 2024 Notes were carried at a cost of $ 416.5 million, net of unamortized debt issuance costs and an original issue discount totaling $ 8.5 million, and had a fair value of $ 440.5 million as assessed under our Level 2 hierarchy.

At December 31, 2024, the 2024 Notes were carried at a cost of $ 415.1 million, net of unamortized debt issuance costs and an original issue discount totaling $ 9.9 million, and had a fair value of $ 429.6 million.

Senior Unsecured Notes

At June 30, 2025, we had $ 425 million aggregate principal amount of senior unsecured notes outstanding.

At September 30, 2025, we had $ 425 million aggregate principal amount of senior unsecured notes outstanding.

The 2024 Notes were issued pursuant to an indenture dated May 21, 2024 and bear interest at a rate of 6.00 %, payable semi-annually on February 15 and August 15.

8 unchanged sentences

The effective interest rate on the 2024 Notes is 6.583 %.

At June 30, 2025 and December 31, 2024, $ 8.9 million and $ 9.9 million, respectively, of unamortized debt issuance costs and original issue discount remained.

At June 30, 2025 and December 31, 2024, $ 9.6 million and $ 15.6 million, respectively, of accrued and unpaid interest on the 2024 Notes was included in “Accounts Payable and Accrued Expenses” on our condensed consolidated balance sheets.

During the three and six months ended June 30, 2024, we recorded a $ 6.8 million loss related to the redemption of the 2020 Notes in “ Interest Expense” on our condensed consolidated statements of comprehensive income.

At September 30, 2025 and December 31, 2024, $ 8.5 million and $ 9.9 million, respectively, of unamortized debt issuance costs and original issue discount remained.

At September 30, 2025 and December 31, 2024, $ 3.3 million and $ 15.6 million, respectively, of accrued and unpaid interest on the 2024 Notes was included in “Accounts Payable and Accrued Expenses” on our condensed consolidated balance sheets.

During the nine months ended September 30, 2024, we recorded a $ 6.8 million loss related to the redemption of the 2020 Notes in “ Interest Expense” on our condensed consolidated statements of comprehensive income.

Revolving Credit Facility

2 unchanged sentences

Borrowings under the 2024 Revolving Credit Facility may be used for general corporate purposes, including to support growth, new business production and operations, and accrue interest at a variable rate equal to, at our discretion, (i) a Base Rate (as defined in the 2024 Revolving Credit Facility) subject to a floor of 1.00 % per annum plus a margin of 0.375 % to 1.875 % per annum, or (ii) the Adjusted Term Secured Overnight Financing Rate (SOFR, as defined in the 2024 Revolving Credit Facility) plus a margin of 1.375 % to 2.875 % per annum, with the margin in each of (i) or (ii) based on our applicable corporate credit rating at the time.

As of June 30, 2025 and December 31, 2024, no amounts were drawn under the 2024 Revolving Credit Facility.

As of September 30, 2025 and December 31, 2024, no amounts were drawn under the 2024 Revolving Credit Facility.

Under the 2024 Revolving Credit Facility, we are required to pay a quarterly commitment fee on the average daily undrawn amount of 0.175 % to 0.525 %, based on the applicable corporate credit rating at the time.

As of June 30, 2025, the applicable commitment fee was 0.225 %.

For the three and six months ended June 30, 2025, we recorded $ 0.1 million and $ 0.3 million, respectively, of commitment fees in interest expense.

As of September 30, 2025, the applicable commitment fee was 0.225 %.

For the three and nine months ended September 30, 2025, we recorded $ 0.1 million and $ 0.4 million, respectively, of commitment fees in interest expense.

We incurred debt issuance costs of $ 2.1 million in connection with the 2024 Revolving Credit Facility and had $ 0.6 million of unamortized debt issuance costs associated with the 2021 Revolving Credit Facility remaining at the time of its replacement.

Combined unamortized debt issuance costs are amortized through interest expense on a straight-line basis over the contractual life of the 2024 Revolving Credit Facility.

At June 30, 2025 and December 31, 2024, remaining unamortized deferred debt issuance costs of $ 2.1 million and $ 2.3 million, respectively, were recorded in “Other Assets” on our condensed consolidated balance sheets.

At September 30, 2025 and December 31, 2024, remaining unamortized deferred debt issuance costs of $ 1.9 million and $ 2.3 million, respectively, were recorded in “Other Assets” on our condensed consolidated balance sheets.

Under the 2024 Revolving Credit Facility we are subject to certain covenants, including a maximum debt-to-total capitalization ratio of 35 %, a minimum consolidated net worth requirement (as defined therein), and a requirement to maintain compliance with the financial standards prescribed by the private mortgage insurer eligibility requirements (PMIERs).

We were in compliance with all covenants at June 30, 2025.

We were in compliance with all covenants at September 30, 2025.

We enter into third-party reinsurance transactions to actively manage our risk, ensure compliance with PMIERs, state regulatory and other applicable capital requirements (respectively, as defined therein), and support the growth of our business.

3 unchanged sentences

The effect of our reinsurance agreements on premiums written and earned is as follows:

For the three months ended June 30, For the six months ended June 30,

For the three months ended September 30, For the nine months ended September 30,

2025 2024 2025 2024

10 unchanged sentences

Quota Share Reinsurance

NMIC is party to nine quota share reinsurance treaties – the 2016 QSR Transaction, effective September 1, 2016 and as modified April 1, 2025, the 2018 QSR Transaction, effective January 1, 2018 and as modified April 1, 2025, the 2020 QSR Transaction, effective April 1, 2020 and as amended January 1, 2024, the 2021 QSR Transaction, effective January 1, 2021 and as modified January 1, 2025, the 2022 QSR Transaction, effective October 1, 2021, the 2022 Seasoned QSR Transaction, effective July 1, 2022, the 2023 QSR Transaction, effective January 1, 2023, the 2024 QSR Transaction, effective January 1, 2024, and the 2025 QSR Transaction, effective January 1, 2025 – which we refer to collectively as the QSR Transactions.

NMIC is party to eight quota share reinsurance treaties – the 2018 QSR Transaction, effective January 1, 2018 and as modified April 1, 2025, the 2020 QSR Transaction, effective April 1, 2020 and as amended January 1, 2024, the 2021 QSR Transaction, effective January 1, 2021 and as modified July 1, 2025, the 2022 QSR Transaction, effective October 1, 2021, the 2022 Seasoned QSR Transaction, effective July 1, 2022, the 2023 QSR Transaction, effective January 1, 2023, the 2024 QSR Transaction, effective January 1, 2024, and the 2025 QSR Transaction, effective January 1, 2025 – which we refer to collectively as the QSR Transactions.

Under each of the QSR Transactions, NMIC cedes a proportional share of its risk on eligible policies to panels of third-party reinsurance providers in exchange for reimbursement of ceded claims and claim expenses on covered policies, a ceding commission and a profit commission (up to a contractually defined maximum) that varies directly and inversely with ceded claims.

7 unchanged sentences

The following table presents the inception date, covered production period, contractual and optional termination dates, current cession rate, ceding commission and profit commission for each outstanding QSR Transaction.

Current amounts are presented as of June 30, 2025.

Current amounts are presented as of September 30, 2025.

NMI HOLDINGS, INC.

7 unchanged sentences

1/1/2019 – 12/31/2019

20 % up to 60 %

12/31/2029 12/31/2022 (1)

1/1/2019 – 12/31/2019

12/31/2029 12/31/2022 (1)

21 % 17 % (5)

20 % up to 61 %

22 unchanged sentences

(5) Under the terms of the 2018 QSR Transaction, NMIC cedes premiums earned related to 21 % of the risk on eligible policies written in 2018 and 17 % of the risk on eligible policies written in 2019.

Effective April 1, 2025, NMIC terminated its engagement with substantially all reinsurers under the 2016 QSR Transaction by mutual agreement on a cut-off basis.

Upon termination, NMIC recaptured approximately $ 180.1 million of previously ceded primary risk-in-force.

The cession rate under the 2016 QSR Transaction decreased from 20 % to 1 % of the remaining at-risk portfolio.

Effective July 1, 2025, the remaining coverage under the 2016 QSR Transaction was terminated by mutual agreement on a cut-off basis.

Effective April 1, 2025, NMIC terminated one reinsurer under the 2018 QSR Transaction by mutual agreement on a cut-off basis, resulting in a recapture of approximately $ 59.7 million of previously ceded primary RIF to that reinsurer.

The cession rate under the 2018 QSR Transaction decreased from 24 % to 21 % on covered policies written in 2018, and from 20 % to 17 % on covered policies written in 2019.

Effective June 30, 2025, NMIC elected to selectively terminate its engagement with certain reinsurers under the 2021 QSR Transaction and concurrently entered into an amended agreement effective July 1, 2025 (the Amended 2021 QSR Transaction) with the remaining reinsurance participants.

Under the Amended 2021 QSR Transaction, NMIC will cede premiums earned related to 20 % of the risk on eligible policies.

NMIC will receive an enhanced ceding commission under the Amended 2021 QSR Transaction.

(6) Under the terms of the 2022 Seasoned QSR Transaction, NMIC cedes premiums earned related to 95 % of the risk on eligible policies after the consideration of coverage provided by other QSR transactions.

Concurrent with the placement of the 2025 QSR Transaction, NMIC entered into two additional sequential quota share reinsurance treaties that will provide coverage for mortgage insurance policies to be written in 2026 and 2027 (the 2026 QSR Transaction and 2027 QSR Transaction).

1 unchanged sentence

Under the terms of the 2027 QSR Transaction, NMIC will cede premiums earned related to 12 % of the risk on eligible policies written between January 1, 2027 and December 31, 2027.

NMI HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

The following table shows amounts related to the QSR Transactions:

As of and for the three months ended As of and for the six months ended

June 30, 2025 June 30, 2024 June 30, 2025 June 30, 2024

As of and for the three months ended As of and for the nine months ended

September 30, 2025 September 30, 2024 September 30, 2025 September 30, 2024

(In Thousands)

5 unchanged sentences

Profit commission 19,083 21,883 62,439 69,641

(1) Includes a $ 0.3 million termination fee for the three and six months ended June 30, 2025 incurred in connection with the amendments of the 2016, 2018 and 2021 QSR Transactions.

Ceded premiums written under the 2016 QSR Transaction are recorded as prepaid reinsurance premiums in “Other Assets” on our consolidated balance sheets and amortized to ceded premiums earned in a manner consistent with the recognition of revenue on direct premiums.

Under all other QSR Transactions, premiums are ceded on an earned basis as defined in the agreement.

Ceded claims and claim expenses under each of the QSR Transactions reduce the respective profit commission received by NMIC on a dollar-for-dollar basis.

In accordance with the terms of the 2016 QSR Transaction, rather than making a cash payment or transferring investments for ceded premiums written, NMIC established a funds withheld liability, which also includes amounts due to NMIC for ceding and profit commissions.

Any loss recoveries and any potential profit commission to NMIC are realized from this account until exhausted.

NMIC’s reinsurance recoverable balance is further supported by trust accounts established and maintained by each reinsurer in accordance with the PMIERs funding requirements for risk ceded to non-affiliates.

The reinsurance recoverable on loss reserves related to the 2016 QSR Transaction was $ 0.1 million and $ 1.1 million as of June 30, 2025 and December 31, 2024, respectively.

In accordance with the terms of the 2018, 2020, 2021, 2022, 2022 Seasoned, 2023, 2024 and 2025 QSR Transactions, cash payments for ceded premiums earned are settled on a quarterly basis, offset by amounts due to NMIC for ceding and profit commissions.

Any loss recoveries and any potential profit commission to NMIC are also recognized quarterly.

NMIC's reinsurance recoverable balance is supported by trust accounts established and maintained by each reinsurer in accordance with the PMIERs funding requirements for risk ceded to non-affiliates.

The aggregate reinsurance recoverable on loss reserves related to the 2018, 2020, 2021, 2022, 2022 Seasoned, 2023, 2024 and 2025 QSR Transactions was $ 32.7 million and $ 31.2 million as of June 30, 2025 and December 31, 2024, respectively.

We remain directly liable for all claim payments if we are unable to collect the recoverables due from our reinsurers and, as such, we actively monitor and manage our counterparty credit exposure to our reinsurance providers.

We establish an allowance for expected credit loss against our reinsurance recoverable if we do not expect to recover amounts due from one or more of our reinsurance counterparties, and report our reinsurance recoverable net of such allowance, if any.

(1) Includes a $ 0.3 million termination fee for the nine months ended September 30, 2025 incurred in connection with the termination of the 2016 QSR Transaction and amendment of the 2018 and 2021 QSR Transactions.

Under the QSR Transactions, payments for ceded premiums earned are accrued and settled on a quarterly basis, offset by amounts due to NMIC for ceding commissions, profit commissions and loss recoveries.

Ceded claims and claim expenses reduce the profit commission due to NMIC under each respective QSR Transaction on a dollar-for-dollar basis.

NMI HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NMIC's reinsurance recoverable balance is supported by collateral trust accounts established and maintained by each reinsurer in accordance with the terms of the QSR Transactions and the PMIERs funding requirements for risk ceded to non-affiliates.

The aggregate reinsurance recoverable on loss reserves related to the QSR Transactions was $ 35.3 million and $ 31.2 million as of September 30, 2025 and December 31, 2024, respectively.

The reinsurance recoverable on loss reserves as of December 31, 2024 included $ 1.1 million related to the 2016 QSR Transaction, which was terminated as of July 1, 2025.

We remain directly liable for all claim payments if we are unable to collect the recoverables due from our reinsurers and establish an allowance for expected credit loss against our reinsurance recoverable if we do not expect to recover amounts due from one or more of our reinsurance counterparties.

Our reinsurance recoverable is reported net of such allowance, if any.

We actively monitor the counterparty credit profiles of our reinsurers and each is required to partially collateralize its obligations under the terms of the QSR Transactions.

The allowance for credit loss established against our reinsurance recoverable was deemed immaterial as of June 30, 2025 and December 31, 2024.

The allowance for credit loss established against our reinsurance recoverable was deemed immaterial as of September 30, 2025 and December 31, 2024.

Excess-of-loss Reinsurance

5 unchanged sentences

NMIC retains losses in excess of the outstanding reinsurance coverage amount.

Under the terms of the XOL Transactions, NMIC makes risk premium payments to its third-party reinsurance providers

NMI HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

for the outstanding reinsurance coverage amount and ceded aggregate premiums of $ 10.4 million and $ 20.5 million during the three and six months ended June 30, 2025, respectively, and $ 9.4 million and $ 18.6 million during the three and six months ended June 30, 2024, respectively.

Under the terms of the XOL Transactions, NMIC makes risk premium payments to its third-party reinsurance providers for the outstanding reinsurance coverage amount and ceded aggregate premiums earned of $ 10.7 million and $ 31.2 million during the three and nine months ended September 30, 2025, respectively, and $ 9.8 million and $ 28.4 million during the three and nine months ended September 30, 2024, respectively.

NMIC applies claims paid on covered policies against its first layer aggregate retained loss exposure under each agreement.

NMIC did not cede any incurred losses on covered policies under the XOL Transactions during the three and six months ended June 30, 2025 and 2024, as the aggregate first layer risk retention for each agreement was not exhausted during such periods.

NMIC did not cede any incurred losses on covered policies under the XOL Transactions during the three and nine months ended September 30, 2025 and 2024, as the aggregate first layer risk retention for each agreement was not exhausted during such periods.

NMIC holds optional termination rights which provide it the discretion to terminate each XOL Transaction on or after a specified date.

6 unchanged sentences

The following table presents the inception date, covered production period, initial and current reinsurance coverage amount, and initial and current first layer retained aggregate loss under each outstanding XOL Transaction.

Current amounts are presented as of June 30, 2025.

Current amounts are presented as of September 30, 2025.

NMI HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

($ values in thousands) Inception Date Covered Production Initial Reinsurance Coverage

22 unchanged sentences

Under the terms of the agreement, NMIC will retain a first layer of aggregate loss exposure on covered policies, and its reinsurance counterparties will then provide second layer loss protection up to a defined reinsurance coverage amount of $ 160 million subject to adjustment on the date of inception based on the persistency of the underlying reference pool through such date.

NMIC retains losses in excess

NMI HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

of the respective reinsurance coverage amounts.

NMIC retains losses in excess of the respective reinsurance coverage amounts.

Insurance-Linked Notes

6 unchanged sentences

NMIC makes risk premium payments to the Oaktown Re Vehicles for the applicable outstanding reinsurance coverage amount and pays an additional amount for anticipated operating expenses (capped at $ 250 thousand per year).

NMIC ceded aggregate premiums to the Oaktown Re Vehicles of $ 3.2 million and $ 6.6 million during the three and six months ended June 30, 2025, respectively, and $ 5.9 million and $ 11.8 million during the three and six months ended June 30, 2024, respectively.

NMIC ceded aggregate premiums to the Oaktown Re Vehicles of $ 3.0 million and $ 9.6 million during the three and nine months ended September 30, 2025, respectively, and $ 4.3 million and $ 16.1 million during the three and nine months ended September 30, 2024, respectively.

NMIC applies claims paid on covered policies against its first layer aggregate retained loss exposure under each excess-of-loss agreement.

NMIC did not cede any incurred losses on covered policies to the Oaktown Re Vehicles during the three and six months ended June 30, 2025 and 2024, as the aggregate first layer risk retention for each applicable agreement was not exhausted during such periods.

NMIC did not cede any incurred losses on covered policies to the Oaktown Re Vehicles during the three and nine months ended September 30, 2025 and 2024, as the aggregate first layer risk retention for each applicable agreement was not exhausted during such periods.

Under the terms of each excess-of-loss reinsurance agreement, the Oaktown Re Vehicles are required to fully collateralize their outstanding reinsurance coverage amount to NMIC with funds deposited into segregated reinsurance trusts.

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Such insurance-linked notes mature 12.5 years from the inception date of their associated reinsurance agreement.

We refer to NMIC’s reinsurance agreements with and the insurance-linked note issuances by Oaktown Re Vehicles individually as the 2021-1 ILN Transaction and 2021-2 ILN Transaction, and collectively as the ILN Transactions.

NMI HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

refer to NMIC’s reinsurance agreements with and the insurance-linked note issuances by Oaktown Re Vehicles individually as the 2021-1 ILN Transaction and 2021-2 ILN Transaction, and collectively as the ILN Transactions.

The respective reinsurance coverage amounts provided by the Oaktown Re Vehicles decrease over a 12.5 -year period as the underlying insured mortgages are amortized or repaid, and/or the mortgage insurance coverage is canceled.

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Current amounts are presented as of June 30, 2025.

NMI HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Current amounts are presented as of September 30, 2025.

( $ values in thousands)

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Under the terms of our ILN Transactions, we are required to maintain a certain level of restricted funds in premium deposit accounts with Bank of New York Mellon until the respective notes have been redeemed in full.

“Cash and Cash Equivalents” on our condensed consolidated balance sheets includes a de minimis restricted amount as of June 30, 2025 and $ 0.1 million as of December 31, 2024.

“Cash and Cash Equivalents” on our condensed consolidated balance sheets includes a de minimis restricted amount as of September 30, 2025 and $ 0.1 million as of December 31, 2024.

Reserves for Insurance Claims and Claim Expenses

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We also establish reserves for claim expenses, which represent the estimated cost of the claim administration process, including legal and other fees, as well as other general expenses of administering the claim settlement process.

As of June 30, 2025, we held gross reserves for insurance claims and claim expenses of $ 163.0 million.

During the six months ended June 30, 2025, we paid 188 claims totaling $ 10.7 million, including 182 claims covered under the QSR Transactions representing $ 2.2 million of ceded claims and claim expenses.

We had 6,709 loans in default in our primary insured portfolio as of June 30, 2025, which represented a 1.00 % default rate against 668,638 total policies in-force, and 6,642 loans in default in our primary portfolio as of December 31, 2024, which represented a 1.01 % default rate against 659,567 total policies in-force.

As of September 30, 2025, we held gross reserves for insurance claims and claim expenses of $ 180.3 million.

During the nine months ended September 30, 2025, we paid 281 claims totaling $ 16.1 million, including 271 claims covered under the QSR Transactions representing $ 3.2 million of ceded claims and claim expenses.

We had 7,093 loans in default in our primary insured portfolio as of September 30, 2025, which represented a 1.05 % default rate against 677,010 total policies in-force, and 6,642 loans in default in our primary portfolio as of December 31, 2024, which represented a 1.01 % default rate against 659,567 total policies in-force.

The size of the reserve we establish for each defaulted loan (and by extension our aggregate reserve for claims and claim expenses) reflects our best estimate of the future claim payment to be made for each individual loan in default.

Our future claims exposure is a function of the number of defaulted loans that progress to claim payment (which we refer to as frequency) and the amount to be paid to settle such claims (which we refer to as severity).

Our estimates of claims frequency and severity are not formulaic, rather they are broadly synthesized based on historical observed experience for similarly situated loans and assumptions about future macroeconomic factors.

Our estimates of claims frequency and severity are not formulaic, rather they are broadly synthesized based

NMI HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

on historical observed experience for similarly situated loans and assumptions about future macroeconomic factors.

The following table provides a reconciliation of the beginning and ending gross reserve balances for insurance claims and claim expenses:

For the six months ended June 30,

For the nine months ended September 30,

(In Thousands)

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Total claims and claim expenses incurred (4)

36,144 14,291

Less claims paid:

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For example, if a loan defaulted in a prior year and subsequently cured and later re-defaulted in the current year, the default would be included in the current year.

Amounts are presented net of reinsurance and included $ 51.5 million attributed to net case reserves and $ 8.8 million attributed to net IBNR reserves for the six months ended June 30, 2025 and $ 43.1 million attributed to net case reserves and $ 6.4 million attributed to net IBNR reserves for the six months ended June 30, 2024.

Amounts are presented net of reinsurance and included $ 77.2 million attributed to net case reserves and $ 9.8 million attributed to net IBNR reserves for the nine months ended September 30, 2025 and $ 63.2 million attributed to net case reserves and $ 7.0 million attributed to net IBNR reserves for the nine months ended September 30, 2024.

(3) Related to insured loans with defaults occurring in prior years, which have been continuously in default before the start of the current year.

Amounts are presented net of reinsurance and included $ 34.9 million attributed to net case reserves and $ 8.1 million attributed to net IBNR reserves for the six months ended June 30, 2025 and $ 39.2 million attributed to net case reserves and $ 6.3 million attributed to net IBNR reserves for the six months ended June 30, 2024.

(4) Excludes aggregate termination fees of $ 0.3 million for the six months ended June 30, 2025 incurred in connection with the respective amendments of the 2016, 2018 and 2021 QSR Transactions.

(5) Represents the settlement of reinsurance recoverables in conjunction with the respective amendments of the 2016, 2018 and 2021 QSR Transactions.

See Note 5 , “ Reinsurance” for additional information.

Amounts are presented net of reinsurance and included $ 43.2 million attributed to net case reserves and $ 8.1 million attributed to net IBNR reserves for the nine months ended September 30, 2025 and $ 49.8 million attributed to net case reserves and $ 6.3 million attributed to net IBNR reserves for the nine months ended September 30, 2024.

(4) Excludes aggregate termination fees of $ 0.3 million for the nine months ended September 30, 2025 incurred in connection with the termination of the 2016 QSR Transaction and amendment of the 2018 and 2021 QSR Transactions.

(5) Represents the settlement of reinsurance recoverables in conjunction with the termination of the 2016 QSR Transaction and amendment of the 2018 and 2021 QSR Transactions.

The “claims incurred” section of the table above shows claims and claim expenses incurred on defaults occurring in current and prior years, including IBNR reserves, and is presented net of reinsurance.

The amount of claims incurred relating to current year defaults increased during the six months ended June 30, 2025 compared to the six months ended June 30, 2024, primarily due to an increase in the total number of new delinquencies emerging during the period tied to the growth and natural seasoning of our portfolio, partially offset by a decrease in the average case reserve established against newly defaulted loans.

Our provision for claims and claim expenses during both the six months ended June 30, 2025 and 2024 benefited from favorable development on prior year defaults.

We recognized $ 43.8 million and $ 46.4 million of favorable prior year development during the six months ended June 30, 2025 and 2024, respectively, primarily due to cure activity and ongoing analysis of recent loss development trends.

The amount of claims incurred relating to current year defaults increased during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024, primarily due to an increase in the total number of new delinquencies emerging during the period tied to the growth and natural seasoning of our portfolio and an increase in the average case reserve established against newly defaulted loans.

Our provision for claims and claim expenses during both the nine months ended September 30, 2025 and 2024 benefited from favorable development on prior year defaults.

We recognized $ 52.4 million and $ 57.2 million of favorable prior year development during the nine months ended September 30, 2025 and 2024, respectively, primarily due to cure activity and ongoing analysis of recent loss development trends.

We may increase or decrease our claim estimates and reserves as we learn additional information about individual defaulted loans, and continue to observe and analyze loss development trends in our portfolio.

Gross reserves of $ 86.5 million related to prior year defaults remained as of June 30, 2025.

Gross reserves of $ 70.6 million related to prior year defaults remained as of September 30, 2025.

NMI HOLDINGS, INC.

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The following table reconciles the net income and the weighted average shares of common stock outstanding used in the computations of basic and diluted EPS of common stock:

For the three months ended June 30, For the six months ended June 30,

For the three months ended September 30, For the nine months ended September 30,

2025 2024 2025 2024

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The accounting policies governing our Mortgage Insurance segment are the same as those described in Item 8, “ Financial Statements and Supplementary Data - Notes to Consolidated Financial Statements - Note 2 - Summary of Accounting Principles” of our 2024 10-K.

Investment income, also referred to as interest revenue, is reported within “ Net Investment Income ” on our condensed consolidated statements of operations and was $ 25.3 million and $ 49.3 million for the three and six months ended June 30, 2025, respectively, and $ 21.0 million and $ 40.7 million for the three and six months ended June 30, 2024, respectively .

Amortization and depreciation expense for software, equipment, and leasehold improvements was $ 2.8 million and $ 5.7 million for the three and six months ended June 30, 2025, respectively, and $ 3.0 million and $ 6.0 million for the three and six months ended June 30, 2024, respectively.

Investment income, also referred to as interest revenue, is reported within “ Net Investment Income ” on our condensed consolidated statements of operations and was $ 27.1 million and $ 76.4 million for the three and nine months ended September 30, 2025, respectively, and $ 22.8 million and $ 63.4 million for the three and nine months ended September 30, 2024, respectively .

Amortization and depreciation expense for software, equipment, and leasehold improvements was $ 2.8 million and $ 8.6 million for the three and nine months ended September 30, 2025, respectively, and $ 3.0 million and $ 9.0 million for the three and nine months ended September 30, 2024, respectively.

We are a U.S.

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federal and various state income tax returns, filed by NMIH on behalf of itself and its subsidiaries.

Our effective tax rate on pre-tax income was 22.2 % and 22.1 % for the three and six months ended June 30, 2025, respectively, compared to 22.4 % and 22.3 % for the three and six months ended June 30, 2024, respectively.

Our provision for income taxes for interim reporting periods is established based on our estimated annual effective tax rate for a given year.

Our effective tax rate on pre-tax income was 22.4 % and 22.2 % for the three and nine months ended September 30, 2025, respectively, compared to 22.2 % and 22.3 % for the three and nine months ended September 30, 2024, respectively.

Our provision for income taxes for interim reporting periods is established based on our estimated annual effective tax rate for a given

NMI HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

effective tax rate may fluctuate between interim periods due to the impact of discrete items not included in our estimated annual effective tax rate, including the tax effects associated with the vesting of RSUs and exercise of options.

Our effective tax rate may fluctuate between interim periods due to the impact of discrete items not included in our estimated annual effective tax rate, including the tax effects associated with the vesting of RSUs and exercise of options.

Such items are treated on a discrete basis in the reporting period in which they occur.

As a mortgage guaranty insurance company, we are eligible to claim a tax deduction for our statutory contingency reserve balance, subject to certain limitations outlined under IRC Section 832(e), and only to the extent we acquire tax and loss bonds in an amount equal to the tax benefit derived from the claimed deduction, which is our intent.

As a result, our interim provision for income taxes for the three and six months ended June 30, 2025 and 2024 primarily represents a change in our net deferred tax liability.

As of June 30, 2025 and December 31, 2024, we held $ 322.2 million of tax and loss bonds in “Prepaid Federal Income Taxes” on our condensed consolidated balance sheets.

On July 4, 2025, the United States enacted tax reform legislation through the One Big Beautiful Bill Act.

Included in this legislation are provisions that allow for the immediate expensing of domestic United States research and development expenses, immediate expensing of certain capital expenditures, and other changes to the U.S.

taxation of profits derived from foreign operations.

We do not currently expect that the Act will have a material impact on our consolidated financial statements.

As a result, our interim provision for income taxes for the three and nine months ended September 30, 2025 and 2024 primarily represents a change in our net deferred tax liability.

As of September 30, 2025 and December 31, 2024, we held $ 322.2 million of tax and loss bonds in “Prepaid Federal Income Taxes” on our condensed consolidated balance sheets.

Stockholders' Equity

On July 31, 2023, our Board of Directors authorized the $ 200 million 2023 Repurchase Program (excluding associated costs and applicable taxes) effective through December 31, 2025.

On February 5, 2025, our Board of Directors authorized the new $ 250 million 2025 Repurchase Program (excluding associated costs and applicable taxes) effective through December 31, 2027 and extended the 2023 Repurchase Program through December 31, 2027 to align its remaining tenor with that of the 2025 Repurchase Program.

The authorization provides us the flexibility, based on market and business conditions, stock price and other factors, to repurchase stock from time to time through open market purchases, privately negotiated transactions, or other means, including pursuant to Rule 10b5-1 trading plans.

During the six months ended June 30, 2025, we repurchased 1.3 million shares at an average price of $ 36.49 per share (excluding associated costs and applicable taxes).

As of June 30, 2025, we had $ 281.0 million of repurchase authority remaining.

We record a litigation liability when we determine that it is probable a litigation loss will be incurred and the amount of such anticipated loss can be reasonably estimated.

In the event we determine that a litigation loss is reasonably possible (though not probable), we disclose an estimate of the possible loss if such estimate can be reasonably established or disclose the matter with no estimate if such estimate cannot be reasonably made.

We evaluate litigation and other legal developments that could affect our accrual for probable losses or our estimated disclosure of possible losses and make ongoing adjustments to our accruals and disclosures as appropriate.

Significant judgment is required to determine both the likelihood and the estimated amount of potential losses related to such matters.

We were named as a defendant in a litigation proceeding pertaining to the refund of certain mortgage insurance premiums under the Homeowners Protection Act.

The case was dismissed in September 2023 and the dismissal was affirmed on appeal in June 2025.

We do not currently expect that we will incur a material loss in connection with the case and have not recorded a litigation liability for this matter.

On July 31, 2023, our Board of Directors authorized a $ 200 million share repurchase program (the 2023 Repurchase Program), effective through December 31, 2025.

On February 5, 2025, our Board of Directors authorized an additional $ 250 million repurchase program (the 2025 Repurchase Program), effective through December 31, 2027, and extended the effectiveness of the 2023 Repurchase Program through December 31, 2027 to align its remaining tenor with that of the 2025 Repurchase Program.

The authorizations provide us with the flexibility, based on market and business conditions, stock price and other factors, to repurchase stock from time to time through open market purchases, privately negotiated transactions, or other means, including pursuant to Rule 10b5-1 trading plans.

During the nine months ended September 30, 2025, we repurchased 2.0 million shares at an average price of $ 37.33 per share (excluding associated costs and applicable taxes).

As of September 30, 2025, we had $ 256.4 million of repurchase authority remaining.

Premiums Receivable, Net

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Premiums receivable may be written off prior to 120 days in the ordinary course of business for non-credit events including, but not limited to, the modification or refinancing of an underlying insured loan.

We established a $ 1.6 million and $ 2.2 million reserve for premium write-offs at June 30, 2025 and December 31, 2024, respectively.

We established a $ 1.5 million and $ 2.2 million reserve for premium write-offs at September 30, 2025 and December 31, 2024, respectively.

We separately recognize an allowance for credit losses for premiums receivable based on credit losses expected to arise over the life of the receivable.

Due to the nature of our insurance policies (a necessary precondition for access to mortgage credit for covered borrowers) and the short duration of the related receivables, we do not typically experience credit losses against our premium receivables and the allowance for credit loss established on premium receivable was deemed immaterial at June 30, 2025 and December 31, 2024.

NMI HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Regulatory Information

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The Wisconsin OCI recognizes only statutory accounting practices prescribed or permitted by the state of Wisconsin for determining and reporting the financial condition and results of operations of an insurance company and for determining its solvency under Wisconsin insurance laws.

NMIC and Re One generated combined statutory net income of $ 30.5 million and $ 67.3 million for the three and six months ended June 30, 2025, respectively, compared to $ 36.0 million and $ 70.7 million for the three and six months ended June 30, 2024, respectively.

NMIC and Re One generated combined statutory net income of $ 30.7 million and $ 98.0 million for the three and nine months ended September 30, 2025, respectively, compared to $ 20.0 million and $ 90.7 million for the three and nine months ended September 30, 2024, respectively.

The Wisconsin OCI has imposed a prescribed accounting practice for the treatment of statutory contingency reserves that differs from the treatment promulgated by the NAIC.

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While such treatment impacts NMIC's statutory net income, it does not have an effect on NMIC's statutory capital position.

The following table presents NMIC's statutory surplus, contingency reserve, statutory capital and risk-to-capital (RTC) ratio as of June 30, 2025 and December 31, 2024.

June 30, 2025 December 31, 2024

NMI HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

The following table presents NMIC's statutory surplus, contingency reserve, statutory capital and risk-to-capital (RTC) ratio as of September 30, 2025 and December 31, 2024.

September 30, 2025 December 31, 2024

(In Thousands)

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(1) Represents the total of the statutory surplus and contingency reserve.

Re One had $ 2.1 million of statutory capital at June 30, 2025 and December 31, 2024.

Re One had $ 2.1 million of statutory capital at September 30, 2025 and December 31, 2024.

NMIH is not subject to any limitations on its ability to pay dividends except those generally applicable to corporations that are incorporated in Delaware.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements