Good day and thank you for standing by. Welcome to the Essent Group Ltd First Quarter 2021 Earnings Conference Call. At this time all participants are in a listen-only mode. [Operator Instructions] I would now like to hand the conference over to your host Chris Curran, Senior Vice President of Investor Relations. Thank you. Please go ahead, sir.

Thank you, Katrina. Good morning everyone and welcome to our call. Joining me today are Mark Casale, Chairman and CEO, and Larry McAlee, Chief Financial Officer. Our press release, which contains Essent’s financial results for the first quarter of 2021 was issued earlier today and is available on our website at essentgroup.com. Prior to getting started, I would like to remind participants that today’s discussions are being recorded and will include the use of forward-looking statements. These statements are based on current expectations, estimates, projections and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially. For a discussion of these risks and uncertainties, please review the cautionary language regarding forward-looking statements in today’s press release. The risk factors included in our Form 10-K filed with the SEC on February 26, 2021 and any other reports and registration statements filed with the SEC, which are also available on our website. Now, let me turn the call over to Mark.

Thanks, Chris, and good morning everyone. Earlier today we reported our first quarter results and are pleased with our financial performance and starting out the year. We believe that these results demonstrate a return to pre-COVID-19 profitability as default trends continue to normalize. As the economy gains momentum coming out of the pandemic combined with an already strong housing environment our outlook is positive. Over the last 12 months or by managing distributed operating model has served as well in navigating a stressed economic environment. The deployment of our pricing engine EssentEDGE and use of reinsurance has been transformational as it allows for better risk selection, and it removes the historical boom and bust nature of a franchise like ours. Our performance during COVID demonstrates the strength of our model and deepens our confidence in the economic engine of our business. It is this confidence that was the primary catalyst in initiating a dividend in 2019 and maintaining one through the pandemic environment. Now, let me touch on our results. For the first quarter of 2021, we reported net income of $136 million as compared to $124 million in the fourth quarter of 2020. Our first quarter results were negatively impacted by a $5.7 million discrete tax item associated with state deferred taxes. On a diluted share basis, we earn $1.21 in the first quarter, compared to $1.10 in the fourth quarter of 2020 and our annualized return on average equity was 14%. During the quarter, we were pleased with our insured portfolios performance. At March 31, our insurance in force was $197 billion and 19% increase compared to $166 billion a year ago. The credit quality of our first quarter NIW was strong with a weighted average FICO of 747 and the loan to value of 91%. As mentioned…

Thanks, Mark, and good morning, everyone. I will now discuss the results for the quarter in more detail. For the first quarter we earned $1.21 per diluted share, compared to $1.10 last quarter, and $1.52 in the first quarter a year ago. The weighted average diluted shares outstanding for the first quarter of 2021 and fourth quarter of 2020 was $112 million shares up from $98 million shares in the first quarter of 2020 due to the impact of our equity offering in May of 2020. Income tax expense for the first quarter was calculated using an estimated annualized effective tax rate of 15.9% before consideration of discrete tax items. As Mark noted, our first quarter results include a $5.7 million discrete charge to income tax expense to provide deferred taxes for states or Essent pays an income tax in addition to a premium tax. For the balance of 2021, we currently estimate to record income tax expense using a 15.9% effective tax rate. We ended the quarter with insurance in force of $197 billion, a 1% decrease compared to $199 billion at December 31 and a 90% increase compared to $166 billion at March 31, 2020. Net earned premium for the first quarter of 2021 was $219 million and includes $11.2 million of premiums earned by Essent Re on our third party business. The average net premium rate for just the U.S. mortgage insurance business in the first quarter was 42 basis points, down from 43 basis points in the fourth quarter of 2020. This decrease in the premium rate compared to the first quarter was principally due to the decline in single premium cancellation income. For the full year 2021, we are estimating that our net earned premium rate will be in the 40 basis points range. The…

Thanks, Larry. In closing, we were pleased with our performance for the first quarter as we produce strong earnings generated excess capital, or by managing distribute models operating on all cylinders and confidence in our economic engine is high. Combined with a strong housing environment and an improving economy post-COVID our outlook on our business is positive. Over the last 12 months, the strengths of our operating model were on display as we remain profitable, raise additional capital and maintain our quarterly dividends from a stressed environment. Now, as we return to strong profitability, we are pleased to augment our capital strategy with a share buyback program. Similar to dividends repurchasing shares is a tangible demonstration of the benefits of our model and generating capital. It also provides further balance in deploying excess capital between the business and redistribution to shareholders. Finally, we are excited about the progress that we were making with EssentEDGE 2.0 and its potential to be a game changer in evaluating a price and credit risk. While we’re in the early stages of its deployment, combining AI with large quantities of data is where the world is moving and we want Essent to be at the forefront of this. Now, let’s get to your questions. Operator?

[Operator Instructions] First question, we have Mark DeVries from Barclays. Your line is open.

Thanks. There’s been a lot of investor focus this quarter just on share shifts, Mark, and I know you guys know focus on market share at all. But I do think it would be helpful just to get your color on what you think might have impacted share this quarter?

Hey, Mark, again, we’ve talked about this in prior quarters. We didn’t really know what our share was until the last couple days. I would say from an Essent standpoint, we continue to focus on insurance in force, and that was relatively flat in the first quarter, which was relatively flat last year in the first quarter. In fact, I don’t think we grew insurance and forced to May of last year. So given what we expect the right with new insurance, and I think we wrote close to $20 billion in the first quarter. And what we expect to write for the rest of the year, we think we’ll grow insurance in force at a healthy clip. So, we continue to be focused on that. So we’re not, again, the quarterly market share shifts there’s a few reasons to get into them. But it had some flows all the time. We’ve been longer term our goal is really around that 15% to 16% share mark. And one of the things around EssentEDGE 2.0 that we’re really excited about, it gives us the chance to optimize the premium around that share, right. We’re always going to – you want to six, if you’re getting to be 20% share or more than that, or you see large swings its price. It’s such a price driven business, lowest price wins, whether it’s the car to the engine, and our view is if you’re going to be in that type of environment, you need to be armed with more information. Enhance that’s why we started the development of EDGE 2.0, a couple years ago now, and rather than, the three or four factors, the rate card or the 12 to 15 factors with the first iteration of our engine. We’re analyzing over 400…

Okay, that’s helpful. On the separate note you guys highlighted, you’re in a very strong capital position here. Could you just talk about opportunities you’re seeing to deploy that into the business? And then kind of what the implications are for your new repurchase authorization and how you might expect to use that?

Yes, I mean, again, it was strong capital position with the HoldCo right with over $500 million of cash. And, of course, we have the line of credit. We also are generating a significant amount of cash with guarantee, in fact, we pulled $100 million dividend out of guarantee in over the last couple of weeks. So again that process will start to. So, I think from a cash standpoint, in terms of redistribution, we have the dividend, which we increased and we’ll obviously, continue to look at that each quarter. The repurchase is really through the end of 2022. So, we could obviously increase that if necessary. But that’s really the plan now and it’s kind of think about it Mark in terms of longer term, given the cash generation and the business, dividends and repurchases now, which is new for us, it’s a way for us to maintain ROEs. So, when we see business, maybe if we don’t like it a certain unit economics, maintaining ROEs through this distribution is a good use of capital. In terms of the business, we feel like the Essent Guaranty is actually pretty good in terms of cash generation in terms of meeting your capital Essent Re. But that could always use capital, if we see opportunities, we’ve written kind of outsized business over the last half of 2020. And in the first quarter of 2021, just given the opportunities we’ve seen there. It’s around, it’s obviously not as meaningful as guarantee, but it’s certainly a use of capital. And as I mentioned, on the last call, we’ll continue to look and study and analyze ways to leverage the business, or leverage some of the things we do well, outside of the core MI, but we’re still early in that, but I think the real story is we have a pretty, I would say well constructed and diversified capital management plan.

Okay, great. Thanks for the comments.

Next question, we have Doug Harter from Credit Suisse. Your line is open.

Thanks. Just wanted to follow-up on the comment you just made Mark about being able to pull $100 million out of guarantee. Can you just talk about on the approval process and kind of thoughts about kind of how dividend from guarantee in future [ph].

Yes, I mean, the approval processes begin given some of the haircut or the point free multiplier, we require GSE approval, which, we received, and just remember, again, from our capital positions. We’re pretty strong with PMIERs with and without the multiplier, and also just, reflect on our balance sheet. We’re not that lever. So our leverage is below 10%. So we’re in a pretty strong capital position, which, and again, it’s reflective in our ratings, which I think the GSE is recognized. So in terms of going forward, we’re not going to speak to a being a regular occurrence, but you can do the math and when folks think about, in terms of just NIW or insurance in force, we’re in a really good position. So, we think we’ll continue to grow insurance in force. But the day we don’t does, all of a sudden our required assets flattened out. And the available assets will keep growing. So it actually increases kind of cash available for shareholders. So it’s – we’re in a very good position. We’re going to redistribute it into the businesses to grow or will have opportunities to increase distributions to shareholders, and as again, as I noted, increased opportunities to allocate that capital to provide another leg of growth down the road. So, we’re really pleased just again, with the cash flow generation of the business, I believe there’s $180 million in the first quarter operating cash flow. So, I think from that standpoint, I think there’s more good things to come.

Great. And just to clarify that $100 million would be – that would add to the 540 that have HoldCo passed that you recorded that with earnings?

It’s not – remember, it was done in the second quarter. And it’s really going to be a matter of whether we upstream it or not remember Essent Guaranty to several of U.S. holdings. So we may just keep it at U.S. holdings.

But Doug, we have two holding companies. We have the top tier that Mark referenced earlier, we report that and now we and we also have the U.S. holding companies that between the two holding companies. This will add to cash at the two holding companies.

Understood. Thank you.

Next question we have Rick Shane from JPMorgan. Your line is open.

Hey, guys, thanks for taking my questions this morning. When I look back through our model, and Mark, I suspect you will choose this number off when I throw it out there. But I see over since 2010, $67 million of claims paid, you currently have a $410 million reserve. The home price appreciation story is really strong. And I think that’s a fundamental tailwind, both in terms, I think that will fundamentally continue. Do you think that there is a divergence now between reserves and a realistic economic outlook? And how do you think that that results over time?

Again, it’s hard to say that there’s a divergence. We would just say one where we feel pretty good about the $400 million plus in reserves, because it just adds to our balance sheet strength. And it kind of gets to the point we made last year, which was the reserves we took or 2020 event, it was really an earnings event, which got reflected in the provision. Looking forward is really going to center around the ultimate performance of the second and third quarter cohorts, because remember, in the fourth quarter and the first quarter, we’re now back to the normal reserves. So if you just isolate, let’s just look at the second quarter cohort and with 37,000 defaults in that quarter, in a 70% of them accurate already, however, we assume 93% would cure. So let’s give it a few more quarters, I think it’s going to take two, three plus quarters and also Rick, you got to remember just what’s going on with forbearance, right? They extended forbearance back new loans going into the fall are still eligible for forbearance. So until that kind of cleans up, you could see borrowers stay in forbearance for a longer period of time, which is going to make it hard for us to remove it from the provision. So, I think we’re levered to the upside. But again, I think it’s going to take time for this to play out.

Got it. Yes. Look, I hear you on that. I think that that’s one of the things that’s clear is that with forbearance been extended, but when we draw an analogue, perhaps between what we’ve seen in auto finance, where collateral values have been so robust, I’m assuming that the severity of law, given home price appreciation versus the historical reserves, really create some opportunity as well, is that the way you guys are looking at it?

Well, I mean, that’s what we did when we set the reserve, right. So, we assumed basically 7% would go to claim right now 30% of them are still sitting in default. So overtime, we expect as they clean up, yes, a lot of them could end up selling the house without ever having to be foreclosed upon. So yes, again, I think will favorably lever to that Rick, but again, we get paid to wait. So, we it’s sitting on the balance sheet strength, we don’t feel the need to kind of aggressively kind of forecast that it’s going to be better than we originally thought. Not quite sure we could do it even from an accounting standpoint. We’ll let it play out overtime.

Yes, and Rick you points a good one, just to clarify the 7% claim rate assumption seems 100% severity. So to the extent that severity is lower than 100%, it would give us the capacity to pay more claims.

Got it. Okay, thank you guys very much.

Sure.

Your next question is from Bose George from KBW. Your line is open

Hi guys good morning. Can you talk about the factors that went into the decision to see, more premium now to Bermuda, how you set the 35% level? I think your of your peers as Bermuda base they see 50% is that the possibility over time.

Well again, it was a first it was something that we had contemplated last year, Bose to be honest, but given COVID we kind took a backseat. So we think it’s a good first step, it’s again, we’d like to do things in increments. So going from 25% to 35% and focusing just on NIW, I think it helps normalize some of the cash flows throughout the company. While we look at 50% over time, we possibly could, but I would say right now we’re very comfortable with 35% and just on NIW. I think if we did anything going forward, it would be more looking at the backlog and moving in. But that’s down the road. I think right now we’re very comfortable. And again, as we said, over time, it plays into 150 basis points to 200 basis points, it kind of gets back to an earlier point, I made those around unit economics, right. We think a lot about unit economics. And quite frankly, that’s the whole business. So if our new engine or the iteration of it can help us optimize premium, that helps unit economics, both in terms of the premium and in managing the credit losses, we’re already pretty darn good at managing expenses. And that’s another again, driver of unit economics, investment yield, which we spent a lot of time on, and some of the things we look at can clearly help, investment, yield and tax and other tax rates and another lever. And I think when you put it together, so whether it’s a commodity business on the front end, there’s no doubt about it, it’s probably becoming more of a commodity business given, when you see how price can move the needle, so you have to be a lot better than little thing. So, once that loan comes in the door, being able to manage up and down unit economics to optimize returns again, I think that’s what differentiates us.

Okay, that makes sense. Thanks. And then, actually just one more on the taxes, you’re seeing in the Biden tax plan that impacts in the arrangements with the Bermuda reinsurance structure?

Again, they’ve been after that, that’s been going on. I mean, this is a newer approach to it. But that was a lot during the Obama administration, too. We’ve seen a lot of proposed rules. It’s a wait and see game. So again, it’s tough to comment on a rule that’s just kind of got floated out there. But certainly something we’ll be watching.

Okay, great. Thanks.

Your next question is from Mihir Bhatia from Bank of America. Your line is open.

Hi, thanks for taking my questions. The first question I actually wanted to ask was just clarify the comments on premium rate. I know you talked about two basis points based on a decline, just sort of see if we can get any more color on the cadence. And really, what I’m trying to understand is, are we talking about the exit being below 40? So like, the 40 for the full year, so the exit will be below or are we paying 40 is where you end up in fourth quarter?

40 is where we end up in the fourth quarter, however, I mean, it’s going to depend a little bit on the persistency of the book. And clearly how much rewrite in the second half of the year and also the shift between purchase, and refinance. But, I think we’re comfortable with that. But there’s so many moving parts, and I think we’ll leave it at that in here. But there’s definitely a difference in the premium yields amongst the different players. And I think that’s something again, that’s when we talked about the engine and looking for ways to optimize that premium level, it’s very important for investors to understand how, around premium, so it’s easy to give away premium to get NIW however, it’s always going to come home to roost in terms of the top-line revenue so far. That’s why we’re so focused on making sure we can optimize the premium level. And we believe we can do that with our new iteration of the engine, and I can give you an example, right? I mean, 760, and there’s 760 loans out there right now that have been in forbearance for nine months. And guess what? That shows up as a 760. Our model felt that they have payment pattern histories, that they’re probably not representative of 760? Well, we’re not going to give them the same price as we’d give, we would think a more stable 760. And then on the other end, when you go down the credit spectrum, can we pick off the 720 that we think is going to perform better than a 720. Remember, we don’t price off FICO [ph] anymore. We price off a custom mortgage score that we’ve developed, it’s very proprietary. But again, it’s something and we’ve that tested over the last several years with different sorts of data. So on that 720, we can price a little bit below the market, however, that’s going to perform better. So again, this is where when we get into the as you think about the next two to three years, five from Mihir, and I remember you and I talking about this out in California a couple of years ago, this is really where the business is going. And again, you can give away premium to get yield. It’s been done. I mean, to get an NIW has been done in this business since we started, but it ebbs and flows, you can always rent share for a quarter or two quarters. But again, we’re focused on, the longer term drivers of the business again, it’s all relative the market levels obviously, have it again, we’re trying to be a little bit better, just around the edges.

That makes sense. Really appreciate those comments. Just one other quick one for me. Just wanted to check if you have any update – is there any update on the NIW? I think it’s, like, $500 billion-ish market at the last quarter. Any update to that view, given a year, quarter into it?

Yes, I mean I think the first quarter was pretty strong. So, yes could it be kind of more in the $550 billion-ish? Yes, certainly, I mean, certainly a strong market, a lot of its going to be dependent on rates in the second half of the year, if they go up. Now, that’ll push refinancings down. But the purchase market, as we all know, is incredibly strong. So, I think it’s a strong, very strong NIW market. But again, just keeping in perspective, the 20 year average is like $250 billion. So this is a nice market, and over the last couple of years, but certainly much higher than it has been previously.

Got it. Thank you.

Your next question is from Ryan Gilbert from BTIG. Your line is open.

Hi, thanks everyone. Good morning. First question is on the favorable development in the losses incurred in the quarter, I think it was $16 million stepping up to $2 million in the fourth quarter of 2020. Is that a $16 million a good run rate going forward? Or was there anything one time in nature in the quarter that how should be thinking about?

Yes, Ryan its Larry, respond to that question, I don’t think you can assume a run rate as relates to prior period. And prior year development tends to be a little bit more lumpy. But what we saw in the first quarter that contributed to the $16 million was, we had favorable cure activity on both the fourth quarter defaults when we move back to the pre-COVID-19 reserve methodology. And also the defaults that have been reported prior to COVID so the defaults that were recorded in the first quarter of 2020 and prior periods, so we had good cure activity on those cohorts. And then in addition, we’re observing some decline in our reserve factors due to the favorable housing environment, strong credit performance, so little bit of reserve factors and also continued strong activity in the fourth quarter and then pre-COVID default cohorts.

Okay, got it. Thanks for that. And then the April default rate drop into 3.4, 3.7. I think what we’ve noticed from peers is there’s been a really nice pickup in interactivity in April, would you say that’s, that’s the case for you or is it being is that drop in the default rate being driven by both lower new defaults and also a couple of years.

It’s really both. And we if you look back at the 8-K that we released in early April, that’ll be the last month in, which we’re reporting our default activity on a monthly basis. We’ll just be reporting that quarterly going forward. But we saw an uptick in both the cure activity as well as reduction in the number of new defaults reported. So continue to see favorable trends in that area. I would point out also, though, that April tends to be a reasonably good month in terms of kind of cure and default activity, but we did see a nice decline in default and pickup and cure activity in April.

Okay, great, thank you.

Your next question is from [indiscernible]. Your line is open.

Thanks. Good morning. I got a few questions. First Larry, last quarter, when you shifted to the pre-COVID methodology, you have some adverse current period development and inclusion of $18 million because of your solar cures versus historical trend on the early stage bucket. Did you have that same adverse development this quarter?

No, we did not ingest that adverse development in the fourth quarter was really due principally to the shift from the COVID-19 reserve methodology that sort of picked 7% claim rate on new defaults versus going back to the model. So that was kind of the anomaly of we went really to a different reserve methodology in the fourth quarter, but we didn’t see any significant in fact, we saw some favorable development for the – during the current quarter.

Okay. Then, in terms of moving the $100 million to the U.S. HoldCo, I believe that can help on the debt side, but what other advantages other than avoiding the excise tax to Bermuda do you get or what other options do you have keeping it there is that something where you can do for example acquisitions from or there are other opportunities up outside of getting M&A?

You got to keep on it holdings gives us a lot of flexibility around investments. So it’s not really about avoiding the excise tax, sort to speak, I mean, we’re flush with cash at the wholesale. So there’s no need to do that. Pay the taxes have to kind of downstream it again. So it gives us a lot of flexibility, really around the investments and what we’re looking to do, want to go forward basis.

Okay. Sorry, two more Essent Re, obviously can always use capital, you’re increasing the cede or have increasing the cede? Is there a plan down streaming of capital in the next quarter or two?

No, we’re actually pretty – we’re actually pretty good with capital there has, that and that’s in that we didn’t do the back book there, we would have needed to kind of have some capital around and, we like the idea of just kind of doing the measured approach. But yes, we’re pretty good from a capital standpoint there too.

Okay. And then last question. Obviously, you were currently tapped the Ireland market as your peers. But one of the things that is very clear is that the benefit under PMIERs can disappear very quickly as the risk amortize is down, and the effective cash flow points rise, how do you possibly see the pace of benefit erosion slow as refi is decline?

It’s a good question. We certainly, we look at – that we do so it’s, we generally look at it in matching, the NIW on a regular basis. Yes, it’s certainly something you kind of have to stay in the market on it to maintain the benefit. But there’s a certain benefit that we expect to get. So it’s a good point, but I think we’re long as you’re continuing to issue. You should be in good shape. It’s when you stop is when, and we saw that last year, we’re really created an issue for offer some.

Okay, thanks.

And also Jeff I just finalized that it’s you don’t want to become over reliant on Ireland, just to your point around the nature of so we look a lot at, where we are with and without Ireland just in terms of capital management.

Your next question is from Phil Stefano from Deutsche Bank. Your line is open.

Yes, thanks. And good morning as Mark, I was hoping you could talk to us about the mix of dividends and repurchases and repurchases is new, so maybe you could talk about your philosophy around valuation based sensitivity and thinking about, is dividends and repurchases the right way to return capital seeing both, as a valve ease the excess capital to maintain returns?

Yes, really a good question, Phil around the pricing, it’s certainly I mean, to take a step back, it is a mix, right? You want to, we think mixing dividends is cash in hand, to investors, and obviously repurchases is a little different way to get cash back and maybe a little bit more kind of tax effective. So we’d like to, and given in terms of our program, it’ll be think of it almost as $1 cost averaging type program. So, we’ll be in the market on a continuous basis. But, when the shares are up, we’ll be buying less than when the shares are down, we’ll be buying more and given the volatility day-to-day and our stock price. So, we think we’ll probably it’s probably a good plan, we’re not going make bets, right? I mean, management teams are very poor, I think in terms of predicting valuations up and down. So it’ll be more of a 10b5 plan. That, will execute off a matrix and we would expect to, we’ll look at it every 90 days. So we always could accelerate it in certain instances, and we could add to it in certain instances. So I would again, it’s going to be a dynamic use of capital management, I don’t think will – the dividend around too much. So repurchases is going to be more of a toggle. And then there’s obviously the estimate investment opportunities, in the core business, which continued to slow, right, because we continue to get the kind of critical mass, and then there’s the investment opportunities outside the core. Once again, we’ve just started with our investments in the fund and that’s something we’ll continue to build and develop over the next several years.

Okay, maybe I’m parsing words through finally but the reading of the release from mind seat says it’s to be executed by the end of 2022. I feel like that’s in some ways in, an affirmation that we’re going to at least do this. I mean, is that the right way.

Yes, Phil, we’re going to be in the market, probably over the next 30 days, this is not, this isn’t a signal, we’re actually going to be in the market in 30 days repurchasing shares on a continuous basis through the end of 2022. So, you’re building your model, you can almost figure out how many shares we’re going to buy a day, and you can walk that into a repurchase over the next, to the end of next year, that’s why we’re very specific on it, it’s not a signal, it’s going to happen, we’re not going to stop it, if prices get too high per se, that would be – that would be actually a good problem to have. So think of it continue with the change will be a lot that you guys, every quarter will toggle, like we say, oh my god, this is, we have more excess capital. And we want to increase that. And we’ll announce that to the market, but it’s not a signal. So it’s actually it’s appropriate that we intend to execute upon. Again, it’s very, consistent with our approach where we like to do kind of slow and steady. So the dividends was one aspect of it, and we didn’t – we announced it, and then we did it, and now we’re announcing this, we’re going to do it.

Okay. And then switching gears, I wanted to dig into EssentEDGE 2.0 a little bit more, as you had mentioned that this was a proprietary platform. I tend not to think of insurance companies as tech companies. So maybe you could talk to us about is this being developed in house? Are you leveraging, an external provider? What’s the real differentiator here that this can’t be replicated by the other five?

No, I mean, it can certainly be replicated. It just takes time. Right? So, we started this two years ago, we hired and it came out with one of our larger banks started , I think they had four MIs and they started the machine deciding which MI they were going to pick, it used to be kind of the old allocation method. And as soon as we saw it, we’re like, wow, this is definitely where the business is going. And then in 2019, we were down meeting with the folks at Optimal Blue and they’re a big pricing provider, the MI industry, and prior to that, a loan officer had to decide who are they were going to price, SN or another MI And generally, and a loan officer would have taken say, two or three, MIs right, they’re not going to run all six, it takes a lot of time and also focused on making sure the borrower gets into the right loan. Optimal Blue change that their new system starting, I believe, at the end of 2019, delivered all of the MI pricing back to the loan officer with the two best prices highlighted in green. I mean, it would be pretty difficult to pick your favorite MI rep when, they’re not in green. That just further solidified, our conviction that we needed to get better, at using more information to make a decision. So, we’re giving every lender our best price, not necessarily the lowest price. So the way the model works is yes, we hired folks from the credit card industry. And we got other data sources. And again, we have folks in-house that have had experience in that in developing, LP, and one of the GSEs. So, we use raw credit data, which…

Okay, great. Look forward to those things, Mark. Thank you.

There are no further questions at this time. Now, I’ll turn the call back over to management.

Well, thanks, everyone for joining us today, and I hope you have a great weekend.

This concludes today’s conference. Thank you for your participation and have a wonderful day. You may all disconnect.