First National Financial Corp (FNLIF) Q4 2024 Earnings Call Highlights: Strong Origination …

• Pre-Fair Market Value Income: $74.8 million, down 3% year-over-year.

• Total Origination: $2.1 billion, up 26.5% from Q4 last year.

• Residential Mortgage Fundings: Up 43% year-over-year.

• Commercial Mortgage Originations: Up 8% in the fourth quarter.

• Mortgage Under Administration: Increased 7% year-over-year to $153.7 billion.

• Revenue: Up 19% in the fourth quarter and 10% for the year.

• Net Interest Margin (NIM): 53 basis points, down from 59 basis points in Q4 last year.

• Broker Fee Expense: Increased 16% year-over-year to $31 million in Q4.

• Salaries and Benefits Expenses: Increased 17% year-over-year in Q4.

• Annual Market Income: Decreased 10% to $290.3 million.

• Common Share Dividend: Increased to an annualized rate of $2.50, with a special dividend of $0.50 per share.

• Common Share Payout Ratio: 61%, excluding special dividend.

• Return on Shareholders’ Equity: 33% after-tax pre-fair market value return for the year.

Release Date: March 05, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

• Residential mortgage fundings increased by 43% year-over-year in the fourth quarter.

• Total origination, including commercial mortgages, was up 26.5% compared to Q4 last year.

• First National Financial Corp (FNLIF) is a leader in the insured multi-unit residential housing space, with fourth-quarter originations up 8%.

• The company expects year-over-year increases in single-family fundings in the next two quarters.

• Mortgage under administration increased 7% year-over-year, reaching a new record of $153.7 billion.

• Pre-fair market value income decreased by 3% compared to the previous year.

• Net interest margin (NIM) on securitized mortgages was lower, at 53 basis points compared to 59 basis points last year.

• Deferred placement fees declined by 57% due to tighter spreads on underlying mortgages.

• Salaries and benefits expenses increased by 17% year-over-year in the fourth quarter.

• The company experienced lower retention rates on mortgage renewals in 2024 due to increased competition.

Q: Can you give us a sense of how the single-family mortgage commitment pipeline is building into early March? A: The pipeline is stronger in January and February compared to 2024, but not at the 40% to 50% magnitude seen heading into Q4. It’s moderated but remains in double digits. – Jason Ellis, President, CEO

Q: How do you expect consumers to react to the ongoing trade war, and could lower bond yields support activity levels? A: While tariffs may impact certain economic sectors, lower rates and fiscal responses could create affordability, encouraging housing activity. Persistent demand and lack of supply in Canada may also support the market. – Jason Ellis, President, CEO