Genworth Mortgage Insurance Australia has held its first-quarter underlying profit steady, despite a 20% fall in gross written premium (GWP).

The lenders’ mortgage insurer reported a 29% increase in first-quarter profit to $89.5 million, but this was lifted by accounting for an investment gain and underlying profit was flat at $69.7 million.

GWP fell 20% to $127.7 million and net claims incurred grew 6% to $18.4 million.

The company says economic conditions were relatively stable and the housing market remains strong, but new business volumes fell. Fewer loans with high loan-to-valuation ratios were written, along with fewer owner-occupier mortgages.

Timing around processing payments also affected GWP.

Genworth’s underwriting result fell 2% to $62.1 million. The combined operating ratio moved to 52.6% from 41.3% in the corresponding period last year.

In February Westpac gave Genworth 90 days’ notice to terminate their contract, which provided 14% of GWP last year.

Genworth has also been asked to tender for its business with NAB, which represented about 11% of GWP last year.