Genworth Mortgage Insurance Australia has reported a 2.3% rise in third-quarter net profit to $65.5 million, and plans to spend up to $150 million on a share buyback scheme.

Gross written premium fell 20.8% to $124.7 million in the three months to September 30, and new written insurance – a measure of new business volume – sank 13.3% to $8.5 billion.

Net earned premium improved 10.6% to $123.9 million.

“The business performed in line with our expectations in the third quarter and we are on track to achieve our full-year guidance,” Acting CEO Georgette Nicholas said.

“Our financial results demonstrate our resilience and strength in the face of a dynamic economy and mortgage market.”

The lenders’ mortgage insurer expects the housing market to remain strong on the back of near-record low interest rates.

It has made no change to its previous forecast, with net earned premium projected to grow up to 5% and a full-year loss ratio of 25-30% in the calendar year.

The share buyback is part of an ongoing capital management strategy that has already secured regulatory approval and support from the majority shareholder, US-based Genworth Financial.

“The on-market buyback is consistent with Genworth Australia’s stated strategy of pursuing capital management initiatives that ensure an efficient capital structure and help us deliver improved returns to shareholders,” Ms Nicholas said. 

“[Genworth] will consider implementing the program where opportunities exist to buy back securities at a discount to book value per share. Buyback acquisitions would therefore be accretive to earnings and net assets per share of the group.”