Genworth MI Canada : DBRS Morningstar Assigns Provisional Rating of Pfd-2 (high) to Sagen MI Canada Inc.'s Preferred Shares

DBRS Limited (DBRS Morningstar) assigned a provisional rating of Pfd-2 (high) with a Negative trend to Sagen MI Canada Inc's (Sagen or the Company; previously Genworth MI Canada Inc.) Series 1 Class A Preferred Shares (the Preferred Shares).

The rating is consistent with DBRS Morningstar's notching approach for capital instruments issued by insurance companies.

RATING DRIVERS

Given the Negative trend and the current economic conditions, an upgrade of the ratings is unlikely in the near term. The trend could return to Stable if the Company demonstrates its ability to navigate the ongoing economic crisis, while maintaining its high levels of regulatory capital. Conversely, a ratings downgrade could result if its capital adequacy deteriorates substantially, leading to a reduced buffer over regulatory capital requirements, or if there is a material deterioration in its loss ratios over an extended period of time that negatively impacts earnings.

ESG CONSIDERATIONS

A description of how DBRS Morningstar considers ESG factors within the DBRS Morningstar analytical framework can be found in the DBRS Morningstar Criteria: Approach to Environmental, Social, and Governance Risk Factors in Credit Ratings at: https://www.dbrsmorningstar.com/research/373262

Notes:

All figures are in Canadian dollars unless otherwise noted.

The principal methodology is the Global Methodology for Rating Mortgage Insurance Companies (January 13, 2021; https://www.dbrsmorningstar.com/research/372309/global-methodology-for-rating-mortgage-insurance-companies). Other applicable methodologies include DBRS Morningstar Criteria: Approach to Environmental, Social, and Governance Risk Factors in Credit Ratings (February 3 2021; https://www.dbrsmorningstar.com/research/373262/dbrs-morningstar-criteria-approach-to-environmental-social-and-governance-risk-factors-in-credit-ratings)

The related regulatory disclosures pursuant to the National Instrument 25-101 Designated Rating Organizations are hereby incorporated by reference and can be found on the issuer page at www.dbrsmorningstar.com.

The rated entity or its related entities did participate in the rating process for this rating action. DBRS Morningstar had access to the accounts and other relevant internal documents of the rated entity or its related entities in connection with this rating action.

Generally, the conditions that lead to the assignment of a Negative or Positive trend are resolved within a 12-month period. DBRS Morningstar's outlooks and ratings are under regular surveillance.

For more information on this credit or on this industry, visit www.dbrsmorningstar.com.

DBRS Limited

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Toronto, ON M5H 3M7 Canada

Tel. [phone]

Ratings

Date Issued	Debt Rated	Action	Rating	Trend	Attributes

i

US = Lead Analyst based in USA

CA = Lead Analyst based in Canada

EU = Lead Analyst based in EU

UK = Lead Analyst based in UK

E = EU endorsed

U = UK endorsed

Unsolicited Participating With Access

Unsolicited Participating Without Access

Unsolicited Non-participating

08-Feb-21 	Preferred Shares	Provis.-New	Pfd-2 (high)	Neg	CA

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