[The webcast starts with a white presentation cover page. “2022 Annual Report - Canada Mortgage and Housing Corporation” is written on it in orange and dark blue-colored fonts. The website is “CMHC.ca” and it’s written under the left corner of the screen. On the cover page, there’s also a man with glasses, looking up towards the sky with a handful of papers in his hand. A woman's camera is turned on at the bottom right of the screen. The woman has curly black hair. Her name is Samantha Jones and she’s talking with a smile on her face with her headset on.]
>>SAMANTHA JONES: Good afternoon, everyone, and welcome to our 2023 annual public meeting. Please know that today's call is being recorded and is available in the language of your choice through our simultaneous translation.
[Samantha starts speaking French. An interpreter starts interpreting.]
>>INTERPRETER1: Hello and welcome to the 2023 annual public meeting of Canadian Mortgage and Housing Corporation. This event is recorded and available in the language of your choice through a simultaneous interpretation service.
[Samantha starts speaking English again.]
>>SAMANTHA JONES: See? And I'm happy that I'll be emceeing today's call. I'm joining you today from Montreal.
[The slide changes on the screen. “HERE WE GATHER - ICI NOUS NOUS RASSEMBLONS” is written on the screen with white font color. There’s also a white rectangular frame covering it. The background is in gradated abstract style with orange and purple colors and their hues. At the right bottom of screen, there are also wave-like white lines covering the half of the page.]
>>SAMANTHA JONES: And I'd like to thank the First Nations around Montreal who have frequented and occupied this territory for millennia. I have gratitude for this land, respect, and appreciation towards many generations of caretakers. In a virtual environment, it's really important to recognize that even though we come from different communities and backgrounds, we are connected through traditions, values and history of our ancestors. Please take a moment to reflect on the good things the land in which you are joining has brought us, and you.
[The page changes back to the first cover page again.]
>>SAMANTHA JONES: I'm joined today by the chair of CMHC Board of Directors, Derek Valentine, with our President, Romy Bowers, and with our CFO, Michel Tremblay.
[Samantha starts speaking French again. The interpreter starts interpreting.]
>>INTERPRETER1: I'm joined today by the chair of CMHC's Board of Directors, Derek Valentine, with our President, Romy Bowers, and with our CFO, Michel Tremblay, who was also the first VP of Business Services.
[Samantha starts speaking English again]
>>SAMANTHA JONES: …including Nadine Leblanc, Senior Vice-President of Policy, Lisa Williams, Senior Vice-President of Housing Programs, Kathleen Devenny, Chief Risk Officer, Marie-Claude Tremblay, Senior Vice-President of Corporate Affairs, Carla Staresina, Vice-President, Commercial Products, Samir Chhelavda, Vice-President of Audit and Evaluation, as well as our Chief Economist, Bob Dugan. A number of CMHC employees have also joined our live stream channel today from locations across Canada, and I welcome them. Before we begin, I just want to remind everybody that this call is being recorded and that we will use a bilingual format for the meeting.
[Samantha starts speaking French again. The interpreter starts interpreting.]
>>INTERPRETER1: So, this meeting will unfold in a bilingual format.
[Samantha starts speaking English again.]
>>SAMANTHA JONES: We'll provide brief opening remarks. Michel Tremblay will then present highlights from the 2022 annual report.
[Samantha starts speaking in French again. The interpreter starts interpreting.]
>>INTERPRETER1: During this presentation, we will have a question period of about 20 minutes at the end, namely for the representatives of the media who are taking part, and the conference, the assembly will be-- The recording will be available after the end of the meeting.
[A middle-aged man with brown and gray hair in a gray suit appears at the right of the screen. His name is Derek Ballantyne. His name is written at the left bottom of his screen portion. The webcast screen is now divided in half. The speaker Samantha Jones is at the left, and Derek Ballantyne is at the right of the screen. Just before he starts speaking, the screen completely focuses on Derek.]
>>DEREK BALLANTYNE: I want to thank you for joining us here today for the annual public meeting, as we reflect on 2022 and look ahead at what's to come for CMHC in 2023.
[Derek starts speaking French. The interpreter starts interpreting.]
>>INTERPRETER1: Thank you for being with us for this annual public meeting.
[Derek starts speaking English again.]
>>DEREK BALLANTYNE: It was a major topic of discussion and action last year.
[Derek starts speaking French. The interpreter starts interpreting.]
>>INTERPRETER1: It's a problem that everyone in Canada is facing and that is having major impacts on our daily life.
[Derek starts speaking English again.]
>>DEREK BALLANTYNE: It motivates us to explore and support the possible solutions in achieving affordability and stability in the Canadian housing system. We are in the midst of a moment when all of Canada is converging around the need for a better, fairer housing outcomes and a need to maintain the stability of the current housing system. That sort of consensus is rare, and it's a precious thing and a great opportunity.
[Derek starts speaking French. The interpreter starts interpreting.]
>>INTERPRETER: The 2023 budget announced a few weeks ago has provisions that build on that momentum.
[Derek starts speaking English again.]
DEREK BALLANTYNE: …investments in CMHC. Our board and our team are committed to ensuring that every dollar has an impact for those who call Canada home. In 2022, I had the chance to speak with many who were working in housing both in Canada and outside our borders, and a chance to share ideas and best practices.
[00:05:05]
>>DEREK BALLANTYNE: Doing so has been a welcome reminder that we have made great progress in this country and we are well served by the institutions and the practices that we have.
[Derek starts speaking French. The interpreter starts interpreting.]
>>INTERPRETER1: The stability of Canada's housing system has helped weather some difficult economic times, and I've been told that other countries look to us as a model. This has remained true in difficult times we face today, and we have learned that it's necessary to establish partnerships.
[Derek starts speaking English again.]
>>DEREK BALLANTYNE: It requires close collaboration with all orders of government, the private and nonprofit sectors and with Canada's indigenous communities. The Housing Supply Summit that was held in 2022 is a great example of this in action. People across the sector came together to share ideas, coordinate activities and take steps towards building a better housing system. It informed our thinking and helped shape how we deliver on our commitments. In 2022, we saw this collaborative approach turn into roofs overhead ultimately, places to call home for people in Canada. In BC, Crystal, who's experienced poverty as a child, is now working with the Skookum Surrey project. She and Skookum Surrey are helping building an understanding of indigenous child poverty in the city. And with the support of CMHC Solutions Lab program and our Housing Research Excellence Award, understanding the linkage between child poverty and housing and housing outcomes. Jim and Terra and their three children and well in Ontario, are homeowners now, thanks to our groundbreaking partnership between CMHC and Habitat for Humanity. This multi-year partnership is supported by the National. Housing Co-Investment Fund, one of the programs under the National Housing Strategy delivered by CMHC. It will produce more than 1,000 homes, like Jim and Terra's across the country.
[Derek starts speaking French. The interpreter starts interpreting.]
>>INTERPRETER1: These are examples that prove a larger point, that CMHC is building relationships across Canada and across the housing system, and partnering to make real positive impacts on lives in this country. As to 2023 and beyond, the only thing we know we can count on is change.
[Derek starts speaking English again.]
>>DEREK BALLANTYNE: …rapidly in different ways and is shaped by many economic and other forces. We must remain agile in response. To do this, in the delivery programs, in the way which we organize our own resources, we continue to improve our alignment with the housing outcomes that we all need. An illustration of this is the increased allocation of resources internally to support research and understanding of the housing system. Data knowledge are key to being effective in housing policy and housing practices. Like everyone watching the economy, we expect more turbulence in housing and in the broader economy in the coming year. The economic headwinds remain strong, and the housing system is challenged to meet the demand for increasing supply of rental and ownership housing. We also witness to increasing affordability pressures on existing multi-unit rental supplies in almost all metropolitan and other centers.
[Derek starts speaking French. The interpreter starts interpreting.]
>>INTERPRETER1: We remain alert to these changes and ready to respond, and shaping the products and services that we offer.
[Derek starts speaking English again.]
>>DEREK BALLANTYNE: Like Canada as a whole, CMHC has entered 2023 with strong economic fundamentals. We remain well capitalized and benefit from strong risk mitigance that guide us and govern us.
[Derek starts speaking French. The interpreter starts interpreting.]
>>INTERPRETER1: We have a skilled and dedicated team at CMHC. I would like to thank them for the incredible efforts made on behalf of all those living in Canada. I would also like to thank all our partners who have helped us reach these objectives.
[Derek starts speaking English again.]
>>DEREK BALLANTYNE: Finally, I'd like to thank Romy Bowers for management and her management team for the leadership in such a challenging time. And the results that we are achieving, they are real and they're really making tangible difference for those living in Canada. And I would also like to thank my fellow directors present and past, who provided the guidance and thoughtful reflection on the issues we face and help guide CMHC in its endeavors. And with that, I'd like to hand things over to CMHC's President and CEO, Romy Bowers.
[A middle-aged woman with a short black hair appears on the right side of the screen. It’s Romy Bowers. She wears glasses and a black jacket with a white shirt. Her name is written at the left bottom of her screen portion. The screen is divided into two now. Derek Ballantyne is on the left side, and Romy Bowers is on the right side of the screen. There’s an orange and black frame on her background with the company’s logo on the right bottom. Romy starts speaking French with a smile on her face. The interpreter starts interpreting. After she spoke a few words, the screen focus is only on her.]
>>INTERPRETER1: Thank you, Derek. Hi, everyone. And welcome to our annual public meeting of 2023.
[00:10:00]
[Romy starts speaking English.]
>>ROMY BOWERS: It's a pleasure to be with you today.
[Romy starts speaking French again. The interpreter starts interpreting.]
>>INTERPRETER1: I'm happy to highlight. CMHC accomplishments from the past year, to share our future plans and to answer some of your questions about our work.
[Romy starts speaking English.]
>>ROMY BOWERS: At CMHC, we know that housing can make a transformative difference in the life of an individual community and our country. This has informed our work since our very beginnings, when we were created to help returning World War II veterans find housing and it continues to drive our work today. Our people come to work every day with a common purpose, to realize a future where everyone in Canada has a home that they can afford and that meets their needs. Today, more and more Canadians are struggling to find housing from those needing emergency shelters or social housing to renters in search of affordable housing and to others who are looking into homeownership. Unfortunately, helping Canadians in this struggle has become increasingly complex and urgent.
[Romy starts speaking French again. The interpreter starts interpreting.]
>>INTERPRETER1: The inflationary pressures we are experiencing now will eventually pass, but our housing shortage, coupled with a growing population, will continue to keep house prices and rents out of reach for many Canadians.
[Romy starts speaking English.]
>>ROMY BOWERS: It is very clear, as Derek mentioned, that housing affordability is one of the major challenges of our times. And, at CMHC, we are meeting that challenge by taking strong, decisive action.
[Romy starts speaking French again. The interpreter starts interpreting.]
>>INTERPRETER1: Last year, we got laser focused on three major priorities. The priorities that will deliver the most impact for Canadians now and in the future.
[Romy starts speaking English.]
>>ROMY BOWERS: One of our top priorities in 2022 was to help the government of Canada to deliver on its commitments to make housing more affordable. We lead the development and delivery of major housing programs, such as those contained in the National Housing Strategy. These programs are mostly intended to help people whose housing needs are not met by the market. As part of this work, we rolled out the third round of the highly successful Rapid Housing Initiative. This program has been embraced by municipalities, nonprofit housing providers and other partners. So much so that we're on track to rapidly build more than 14,500 permanent affordable homes for those experiencing or at risk of homelessness.
[Romy starts speaking French again. The interpreter starts interpreting.]
>>INTERPRETER1: In 2022, we also designed the recently launched. Housing Accelerator Fund. This fund will help municipalities to address barriers that prevent or slow down housing projects in the development phase. This means much needed homes will get built more quickly.
[Romy starts speaking English.]
>>ROMY BOWERS: Finally, we worked with our federal partners to design legislation intended to make housing more affordable. The one-time federal top-up of the Canada Housing Benefit provided 500-dollar payments to low-income renters struggling to pay the rent. And the prohibition on the purchase of residential properties by non-Canadians Act will help ensure that housing in this country is used as intended, to house people that are living here. In 2023, we'll be focusing on other federal initiatives, such as, number one, a strategy to improve housing for indigenous people living in urban, rural and northern areas. And this strategy is currently being co-developed with indigenous partners. Two, standing up a low-cost flood insurance program with Public Safety Canada, and a third example is the Home Buyers' Bill of Rights. The second priority for CMHC in 2022 was supporting the sustainability and stability of Canada's housing system. This is especially important in our current economic context. We do this largely by providing commercial products like residential and multi-unit mortgage loan insurance.
>>ROMY BOWERS: And by giving lenders reliable access to mortgage funding. Last year, we launched a new product…
[00:15:00]
>>ROMY BOWERS: …called MLI Select, that incentivizes developers to build more affordable, accessible and climate-compatible rental housing. This project has been extremely successful, and we have seen a huge uptake on it throughout the year.
[Romy fixes her camera and her glasses while talking.]
>>ROMY BOWERS: In 2023, we'll be focusing on our Homeowner Business Transformation project. This will modernize our mortgage loan insurance business to allow for faster decision making, more transparency and easier access to housing credit.
[Romy starts speaking French again. The interpreter starts interpreting.]
>>INTERPRETER1: Finally, our third priority has been to position CMHC to better serve. Canadians in the future.
[Romy starts speaking English.]
>>ROMY BOWERS: A big part of that is by ensuring that CMHC is at the forefront of research data and forecasting. It also means that we're filling knowledge gaps and developing policy ideas for decision makers. As an example, in 2022, we launched a major series of housing supply reports. This is already giving us and everyone in the housing sector a clear picture of just how serious Canada's housing supply gap is. It is also offering insights on how to fix it and encourage those listening in on the call today to look for more reports on this supply issue to be released in the weeks and months to come.
[Romy starts speaking French again. The interpreter starts interpreting.]
>>INTERPRETER1: In 2022, we also made strides to ensure that the investments and efforts we make on housing served to advance other issues that matter to Canadians. Issues like climate change, equity and reconciliation with indigenous peoples, for example.
[Romy starts speaking English.]
>>ROMY BOWERS: Last year, we promptly joined the Canada Council for Progressive Aboriginal Relations program. This provides accountability and third-party validation of our reconciliation efforts. This year, we're developing an equity framework that could double drive our efforts to create a fair housing system for all Canadians. In just a moment, our Chief Financial Officer, Michel Tremblay will provide a more detailed report on our performance in 2022. But in closing…
[While Romy is speaking English, the Interpreter starts interpreting in French. After a while, Romy starts speaking English again.]
>>ROMY BOWERS: They are committed to our priorities and continue serving Canadians better. They are living our company's values. A courageous community building impactful solutions together. I also wanted to recognize the strong leadership of our Board of Directors and of our Chair and Derek Ballantyne. And finally, as proud as I am of CMHC progress, we are just one organization. Solving Canada's complex housing problems requires a whole-of-society approach. Everyone in Canada has an interest in a fair, affordable housing system, and I believe that everyone has a role to play. Throughout 2022, CMHC has leveraged its unique position to bring together our extensive network in both government and in industry. In the months and years to come, we will continue to promote big, bold changes in the way that Canada builds, operates and finances housing.
[Romy starts speaking French again. The interpreter starts interpreting.]
>>INTERPRETER1: Together, we are helping ensure more Canadians have access to what they deserve, that is a home that they can afford and that meets their needs.
[Romy continues her speech in English with a big smile on her face.]
>>ROMY BOWERS: Thank you so much for your attention this afternoon, and with that, I'm going to turn things over to Michel Tremblay, our Chief Financial Officer, to provide you with more details about our 2022 results.
[As her final words, she says “merci beaucoup” which means “Thank you so much” in English.]
[The screen gets divided into two again. An aged man appears on the screen with his headset on. His name is Michel Tremblay. His name is written at the left bottom of his screen portion. He wears a black suite, a black tie and a white shirt. He also has the same background as Romy Bowers has. He starts speaking in a serious tone of voice.]
>>MICHEL TREMBLAY: I will talk about our financial performance as well as some of the results and the outcomes we were able to achieve in 2022.
[Michel starts presenting with a cover page. On the presentation page, “2022 Annual Report - Canada Mortgage and Housing Corporation” is written in orange and dark blue-colored fonts. The website is “CMHC.ca” and it’s written under the left corner of the screen. There’s also a man with glasses, looking up towards the sky with a handful of papers in his hand. Michel starts talking in French.]
>>MICHEL TREMBLAY: Merci beaucoup, Romy.
[In English, it means “Thank you so much, Romy.” After this, Michel starts speaking English.]
>>MICHEL TREMBLAY: So, starting with our revenues and government funding, they total 6.1 billion dollars in 2022, which is a slight decrease of approximately 3 percent from the prior year.
[The presentation page changes. All the texts are in French. A chart with clustered columns is seen on the left of the screen. The chart’s title is: Return on investment in 2022. At the right side of the chart, the numbers are ranging from 1,0 $ to 7,0 $. Right next to the numbers, there’s a text in parenthesis. It says: billions of dollars. At the bottom of the chart, we see the years. While dark blue color represents the year “2022”, the orange color represents the year “2021” on the chart. The first series of the chart is named as “Total revenue and public financing”. The years 2022 and 2021 is compared at this first series of chart with two columns. While the orange column that represents the year 2021 is at 6,3$, the dark blue column that represents the year 2022 is at 6,1$. The second series of the chart is named as “Total expenses”. There are another two columns here, one is dark blue and the other one is orange. While the orange column that represents the year 2021 is at 3,7$, the dark blue column that represents the year 2022 is at 3,9$. The third series of the chart is named as “Net profit”. There are another two columns here, one is dark blue and the other one is orange. While the orange column that represents the year 2021 is at 1,9$, the dark blue column that represents the year 2022 is at 1,7$. There’s a section at the left side of the screen with dark blue background color. There are three French white texts on it. The first text says: Total revenue and public financing $6.1 billion. The second text says: Total expenses $3.9 billion. And the third text says: Net profit $1.7 billion.]
>>MICHEL TREMBLAY: We received 3.4 billion in government funding for housing programs in 2022. Again, this was a slight decrease from 2021, mainly due to lower contributions from the Rapid Housing Initiative, as that initiatives second round ended in 2022. The third round was launched in December of last year.
[00:20:02]
>>MICHEL TREMBLAY: This decrease was partially offset by contributions from the one-time top-up, to the Canada Housing Benefit and other programs, such as the Canada Community Housing Initiatives, and the Federal Lands Initiatives. Turning to our commercial operations, revenues from their commercial operations, mortgage insurance and mortgage funding activities was 2.5 billion dollars in 2022. Again, a slight decrease when compared to 2021.
[Michel starts speaking French. The interpreter starts interpreting.]
>>INTERPRETER2: Expenses went down 3.6 percent in 2022 because of an increase of insurance claims and there were expenses that went up. And that is because we did offer the one-time top-up program. And there was a decrease of 8 percent with the expenses for other programs, and this decrease was following the decrease of the funding of governmental programs that I just mentioned. And now, if we look at insurance claims that were settled, we have to know that, in 2021, the provision for the regulation or the settling was favored by the economy. The economy was getting better after COVID-19.
[Michel starts speaking English.]
>>MICHEL TREMBLAY: …which directly reduces the government of Canada's annual deficit.
[Michel starts speaking French. The interpreter starts interpreting.]
>>INTERPRETER2: We were also able to give some dividends to the Canadian government.
[Michel starts speaking English.]
>>MICHEL TREMBLAY: …in 2023, following the adoption of new accounting standards for insurance contracts. This will also affect our results starting in 2023, where we expect lower net income, mainly due to a slowing of earning patterns of our insurance revenue under this new accounting standards. Our results for the first quarter of 2023 will include this change and will be published and available on our website by the end of May.
[The presentation page changes. The page’s background color is dark blue and there are three white texts on it with icons at the left side of the screen. The texts are in English. The first icon is a hand holding a globe with a percentage sign inside. The first text right next to this icon says: Canada’s economy grew by 3.4% in 2022, a faster pace than the pre-pandemic decade average annual growth of around 2%. The second icon is a graphic with an arrow that represents a peak. The second text right next to it says: Widespread and elevated inflation gripped the Canadian economy peaking at 8.1% in June 2022. The third icon is a house with a sale tag on it. The third text right next to it says: Rising interest rates and lower real disposable incomes caused a contraction of housing market activity.]
>>MICHEL TREMBLAY: Turning to the economic environment of Canada, the Canadian economy continued to grow in 2022 with a real GDP increase of 3.4 percent. That is a faster pace than what we've seen in the previous decade, which had an average annual growth of around 2 percent. Canada's labor market conditions remain tight, setting a forty-year record low unemployment rate of 5 percent in December. Canadian businesses also reported widespread labor shortages. Meanwhile, the Canadian economy experienced higher inflation in 2022, peaking at around 8 percent in June. These rising interest rates in response to the inflation and lower real disposable income caused a marked contraction of housing market activity in the latter ten months of 2022.
[Michel starts speaking French. The interpreter starts interpreting.]
>>INTERPRETER2: If we look at these records in 2022, the number of starts has declined, but remain elevated compared to the level of construction of the past 5 years.
[The presentation page changes. The background color is white. There’s a yellow and purple house logo at the right top of the screen. There’s a text on the logo that says: National Housing Strategy. The dark blue title on the page says: Delivering the National Housing Strategy. There are four text sections under the title with orange sub-titles above each of them. The first sub-title, which is at the top left, is: National Co-Investment Fund. The text under it says: Committed funding to support the construction of over 28,985 units and repair/renewal of over 111,752 units. The second sub-title, which is next to the first one, is: Rapid Housing Initiative. The text under it says: $2.5 billion committed for rounds 1 and 2 to support the construction of over 10,249 units. The third sub-title, which is at the bottom left, is: Rental Construction Financing Initiative. The text under it says: Committed funding to support the construction of over 39,682 units. The fourth sub-title, which is next to the third one, is: Federal Community Housing Initiative. The text under it says: Phase 2 providing rent assistance to over 7,958 low-income units, supporting over 39,710 community housing units.]
[Michel starts speaking English]
>>MICHEL TREMBLAY: …National Housing strategy. The federal government's plan to ensure more Canadians have a safe and affordable place to call home. This comprehensive strategy covers the entire housing continuum from shelters and transitional housing to community and affordable housing to market rental and homeownership. Here are some of our key NHS's highlight as of December 2022. We continued to deliver on the National Housing. Co-Investment Fund, a fund that supports the construction, repair and renewal of community and affordable housing. Since its launch, we have committed funding for the creation of nearly 29,000 new units and for the repair and renewal of close to 112,000 units. Their Rental Construction Financing initiative provides low-cost insured loans to increase the supply of rental housing. To date, we committed funding for almost 40,000 units.
[Michel starts speaking French. Interpreter starts interpreting.]
>>INTERPRETER 2: We have also engaged the totality 2.5 billion dollars for the initiative of creation of homes. This initiative will support the construction of 10,000 units. This far exceeded the target of 7,500 units and the third round announced in Budget 2022, was launched in December.
[Michel starts speaking English.]
>>MICHEL TREMBLAY: It provides rent assistant for low-income tenants. As of December 2022, over 73 million in rental assistance was provided to over 7,900 low-income households.
[00:25:00]
>>MICHEL TREMBLAY: We, at CMHC, were encouraged by the additional investment in housing announced in both the Federal 2021 and 2022 budgets. We work diligently to ensure a timely launch of supporting initiatives, including the extension of the Affordable Housing Innovation Fund with a new renter own stream. Round three of the Rapid Housing Initiative expected to create up to 4,500 new affordable housing units and a one-time top-up to the Canada Housing Benefit, to name but a few.
[The presentation page changes. The page is divided into two parts. While the left side of the page has dark blue background color with white texts on it, the right side of the page has white background color with dark blue texts on it. On the left side, there are four text segments. The first segment says: Homeowner Insurance Volumes – 64,266 units. The second segment says: Portfolio Insurance Volumes – 36,211 units. The third segment says: Multi-Unit Insurance Volumes – 178,172 units. And the fourth segment says: Arrears rate – 0.25%. On the right side, there are two text segments. The first text segment says: Insurance-in-Force – (As at) 31 December 2022: $399 B. The second text segment says: Mortgage Insurance capital available: 175% of minimum capital required.]
[Michel still speaks English.]
>>MICHEL TREMBLAY: Moving on to our commercial products, we offer transactional homeowner insurance. This protects lenders against borrower defaults. It enables qualified borrowers with a down payment between 5 and 20 percent to access mortgage financing at competitive rates.
[Michel starts speaking French. The interpreter starts interpreting.]
>>INTERPRETER2: We enabled buyers to acquire 64,000 units and more than 16 percent of these cases ensured loans for people living in rural areas. This is a decrease of 12 percent compared to the previous year. Less people have bought in 2022 because of the increase in mortgage prices.
[Michel starts speaking English.]
>>MICHEL TREMBLAY: CMHC also provides portfolio insurance. This allows the lender to pool and ensure low-ratio residential mortgages, and it makes them eligible for our National Housing Act, mortgage-backed securities and Canada mortgage bonds, mortgage funding programs. In 2022, we insured more than 36,000 units through portfolio insurance, an increase of 59 percent from the previous year. This results from our efforts to expand our presence in the insured space. A stronger market share will enable us to better support market stability.
[Michel starts speaking French. The interpreter starts interpreting.]
>>INTERPRETER2: We also ensure mortgage funding for collective buying of units. In 2022, our insurance products contributed to the refinancing or the purchasing of 178,000 units
[Michel starts speaking English.]
>>MICHEL TREMBLAY: As Romy mentioned, this is largely driven by the popularity of our new MLI Select product, which focuses on affordability, accessibility, and client compatibility. At the end of 2022, our total insurance in force stood at 399 billion dollars. This is a slight decrease of 2 billion when compared to 2021, as the runoff of existing policies in force exceeded the insurance of new loans. Of this amount, 136 billion is for multi-unit insurance, 179 billion for our homeowner transactional and 84 billion represents portfolio insurance. Our arrears rate, which includes all loans more than 90 days past due as a percentage of our total outstanding insured loans, has dropped in 2022 from 0.28 percent to 0.25 percent, which is consistent with employment and house price trends that we've seen in Canada over 2022. As of December 31, 2022 of the 179 billion of transactional homeowner insurance in force approximately 82 percent of those were fixed rate mortgages. As a result of recent increases in interest rates, however, some mortgages have seen their amortization temporarily increase. This temporary extension and amortization has led to an 8 percent decrease in our mortgage insurance capital adequacy ratio as of December 31. We remain well capitalized, however.
[The presentation page changes. On the left side of the page, there’s a man with black short hair, carrying a baby while cooking. They are in the kitchen. The walls around them are white. The man wears a gray t-shirt, and he has a beard, as well. The baby has curly black short hair, wearing a brown top and a pants with colorful stripes on it. On this side of page, there’s also a frame with a gradient effect with colors from orange to dark blue. On the right side of the page, there are five bullet points. The text on the first says: $147 B National Housing Act Mortgage-Backed Securities guaranteed. The text on the second says: $40 B Canada Mortgage Bonds securities guaranteed. The text on the third says: $1.0 B: Guarantee and Application Fees Received. The text on the fourth says: Guarantees-in-force (As at) 31 December 2022: $471 B. And the text on the fifth says: Economic capital available to economic capital required 149%.]
[Michel still speaks English]
>>MICHEL TREMBLAY: Turning to our mortgage funding business, CMHC promotes the stability in the Canadian financial systems by providing access to funding for mortgages. Our annual limit, under the National Housing Act, mortgage-backed securities and Canada mortgage bonds remained unchanged in 2022, the first at 150 billion and a second at 40 billion, respectively.
[Michel starts speaking French.]
[Michel starts speaking English.]
>>MICHEL TREMBLAY: The guarantee and application fee we received decreased by 46 million dollars, or 5 percent year over year. This is due to a higher issuance of affordability-linked mortgage pools this year. These pools are subject to lower fees.
[Michel starts speaking French. Interpreter starts interpreting.]
>>INTERPRETER2: At the end of 2022, 471 billion dollars, an increase of 2 percent in comparison to last year, and that is because of liquidation of the number of units.
[00:30:10]
[Michel starts speaking English.]
>>MICHEL TREMBLAY: As Canada's national housing agency, we will continue to respond and be there when Canadians need us most.
[The presentation stops. The screen is focused on Michel only. He still speaks English.]
>>MICHEL TREMBLAY: The housing investment in recent federal budgets confirmed that the government of Canada will continue to look to CMHC to support Canadians, and we will continue to manage the public resources entrusted to us prudently for the benefit of all Canadians.
[Michel starts speaking French. Interpreter starts interpreting.]
>>INTERPRETER1: I would like to join Romy and Derek to thank our employees for their employees, for the pursuing of this vision. Our results we owe them to their dynamics.
[The screen is divided into two again. Samantha Jones reappears on the right side of the screen with her headset on, and she starts speaking with a smile on her face.]
>>SAMANTHA JONES: Thank you very much, Michel.
[Samantha starts speaking French. Interpreter starts interpreting.]
>>INTERPRETER2: Now it's the question period… We will begin with questions from the public that were submitted online during the register of the event.
[The screen focus is only on the Samantha Jones.]
[Samantha starts speaking English.]
>>SAMANTHA JONES: So, questions will be answered in the language in which they were submitted. So, I'll start with the first question. "In recent years, severe weather events have affected Canadians across the country. From floods and severe storms to drought-related forest fires, homes have been destroyed or affected in connection with these events. At a time when we have a housing affordability crisis, how is CMHC addressing the issue of climate change in the housing industry?" I'll leave it to Romy.
[Samantha welcomes Romy with a big smile on her face.]
[The screen is divided into two again. While Samantha is on the left side of the screen, Romy Bowers is at the right side of the screen. Romy starts speaking English while Samantha listens.]
>>ROMY BOWERS: Thank you very much for this very important question. And I just want to highlight that, at CMHC, we're committed to doing our part toward advancing housing affordability in a way that is climate compatible and climate resilient and, at the same time, promotes stability and sustainability in Canada's housing system. In the annual report that was released today, you'll find a number of descriptions and ways that we've advanced work in this area, including enhancing energy efficient objectives in our new and existing programs. We've also partnered with the financial industry and government to share knowledge and best practices on the use of climate-related data. Specifically, I'd like to also call out the work that CMHC has been doing in exploring housing finance solutions, to address climate related risks, such as floods or other risks in order to promote climate, resilient, affordable housing. Budget 2023 proposes to provide over 31 million dollars over 3 years to Public Safety Canada and CMHC to work with the Department of Finance to stand up a low-cost flood insurance program. And this would include offering reinsurance and a separate insurance subsidy program and CMHC looks forward to contributing to this work. Thank you very much.
[Samantha starts speaking English.]
>>SAMANTHA JONES: Thank you so much, Romy.
[The screen focus is only on Samantha.]
>>SAMANTHA JONES: We'll move on to the second question.
[Samantha starts speaking French. Interpreter starts interpreting.]
>>INTERPRETER2: The second question is, "Despite the actions taken, it's still difficult to buy a home in 2022. As long as there are no advantages per unit, the situation will just get worse. How does CMHC view the economic situation before us?"
[The screen is divided into two. A guy named Bob Duggan appears on the right side of the screen. He has gray hair. He wears a black suit with a black tie and a black shirt.]
[Bob Duggan starts speaking French with a serious look on his face. Interpreter starts interpreting while Samantha listens on the left side of the screen.]
>>INTERPRETER2: Thank you very much for the question. According to a recent report on the perspectives of the housing market, the slowing down of the economic growth will continue to have an effect on the housing market in 2023. The price of units has gone down. However, access to property will not be as easy as before because of the interest rates and the high prices. Probably, the accessibility will continue to decrease on the rental unit side because of the offer. We are expecting the prices and the starts to increase in the future, and inflation should reach the target of 2 percent before the end of 2024. And the mortgage rates will go down slowly in comparison to 2023. The regain in growth, revenue will sustain the growth in the offer of housing units.
[The screen focus is only on Samantha Jones. She starts speaking English.]
>>SAMANTHA JONES: The second question. "Has CMHC looked into alternative approaches to housing, particularly for medium and low-income renters?" For this one, I'll invite Lisa Williams to answer, please.
[Samantha welcomes Lisa with a smile on her face. The screen is divided into two again. A woman named Lisa Williams with her earphones on appears on the right side of the screen. She has a straight blonde hair. She wears glasses, a maroon dappled blazer with a light pink blouse in it. She starts speaking English with a smile on her face while Samantha listens at the left side of the screen.]
[00:35:00]
>>LISA WILLIAMS: Thanks, Samantha. We work with a broad range of housing system participants to conceive prototype and try out solutions to complex housing issues. To improve housing outcomes, we look to mobilize knowledge and scale up good ideas. One successful example of innovative partnership that delivered results for renters is our investment in Sparrow, a digital platform to match people in need of housing and people with available space. It was launched in select Canadian markets in 2022 and has achieved its targets to unlock previously empty bedrooms at rents below average market friends. We also served as a funding partner for Habitat for Humanity Windsor-Essex, in a multiplayer collaboration to build the first 3D-printed homes for residential use in Canada. This technology was used last year to construct an accessible net zero ready, four-plex design in Leamington. The Rapid Housing Initiative, one of the initiatives under the National Housing Strategy, is an example of this at the program level. It was created to get affordable homes built quickly, and it has consistently exceeded its targets, and that success has led to the program being extended twice. To date, with a budget of 2.5 billion dollars, we have supported the creation of more than 10,000 new homes well beyond our original target of 7,500. The government also recently announced the Housing Accelerator Fund to improve supply at the municipal level. This 4-billion-dollar fund is for municipalities that are willing to bring forward innovative solutions to accelerate housing supply. The fund is targeting the creation of at least 100,000 more housing units than would have occurred without the program by 2026-2027. But the benefits in the form of better, streamlined development processes will keep paying off into the future.
[Samantha starts talking English with a big smile on her face. Lisa also smiles.]
>>SAMANTHA JONES: Thank you so much, Lisa.
[The screen focus is only on Samantha again. Samantha starts speaking French. Interpreter starts interpreting.]
>>INTERPRETER2: Let's move on to the fourth question. "Since the launch of this National Strategy on housing in 2017, the economic context has changed a lot. We have gone through a worldwide pandemic, a slowdown in the economy that is still felt. Is the SNL, is it still the adequate tool to meet the needs of the housing field in Canada?"
[Screen is divided into two again. Romy Bowers reappears on the right side of the screen. Samantha welcomes Romy with a smile. Romy starts talking French while smiling. The interpreter starts interpreting.]
>>INTERPRETER2: Thank you, Samantha. Since the launch of the strategy, we have enlarged and adapted by reacting to the evolution and the comments received, and we have improved what was working. The government of Canada is determined to bring forth its contribution to increase the rental unit part or what is available for the population to rent. And these improvements have been put forward thanks to the Canada Housing Strategy. So, this strategy meets the needs throughout the entire continuum of housing, for example, traditional homes, accessible homes, homes for owners that live within their homes. So, we want to adapt with this strategy the housing offer to those that are most vulnerable. The SNL, this strategy, wants to meet the specific needs of a population that is a precise part of the population. Indigenous people, people in vulnerable situations, people that are fleeing violent situations, people that are elderly. So, the government has also launched recently the fund for accelerating the construction of homes, four billion dollars, and the goal is to finish the funding or to supply the funding to initiatives that increase the housing units that are available. There is a collectivity. And we would like these housing units to respect climate change, have zero emissions or very little emissions. And we'd like to reduce waste. We are aware that we need to do more to meet people's needs of the vulnerable people in Canada. And so, in this perspective, we are working constantly to improve the way that we design and put forward the initiatives of the strategy. Thank you.
[00:40:12]
[Samantha smiles at Romy and starts speaking English. The screen is still divided into two. Samantha is at the left, and Romy is at the right.]
>>SAMANTHA JONES: We will move to the fifth question. "Can you give an update on how CMHC is doing regarding equity and reconciliation? It was one of the main focus areas you identified, where CMHC could do better a few years ago. How is CMHC addressing the situation?"
[Samantha continues speaking English with a big smile on her face.]
>>SAMANTHA JONES: I'll hand this over to Romy.
[Romy starts speaking English while Samantha listens at the left side of the screen.]
>>ROMY BOWERS: Yeah, thanks. Thanks. Again, another excellent question. And, at CMHC, we know that we cannot help people in Canada meet their housing needs without considering and remediating the harmful effects of discrimination, racism and inequity.
[Screen focus is only on Romy. Romy still speaks English.]
>>ROMY BOWERS: And we believe that a well-functioning housing system promotes equity, stability and long-term affordability as well as sustainability. And you know, CMHC has been looking at this very seriously, and we've taken an important step toward embedding reconciliation and equity into our internal processes. And we've done this through the development of our diversity and inclusion framework, which is the result of significant input from over 50 percent of the workforce at CMHC. We have also conducted consultations with over 150 people with disabilities to identify barriers to accessibility at CMHC. We've also supported our reconciliation and equity commitments through a commitment to educating, training, and improving the cultural competency of our employees. And, as a good example of this, I'm very proud of the fact that 98 percent of our employees have completed our Cultural Learning program entitled The Path, a journey through indigenous Canada. We have also created senior leadership positions to oversee the development and implementation of a reconciliation action plan in equity framework. We hired our first VP of indigenous policy and relations as well as our first VP of social policy and equity. We are also involved in the Progressive Aboriginal Relations Certification Program. I mentioned this a little bit earlier. And we feel that this is really important in helping us guide the cultural shift we need to meet our reconciliation objectives. Now, maybe a few comments from an external perspective. We have made some progress to improve access and affordability for racialized communities by supporting several initiatives that were informed by and will empower communities. CMHC is sustaining actions to better develop our understanding of the challenges faced by local communities, and we are committed to working with partners to address discrimination and inequities in the housing system. And you'll see that when you look at the description of our corporate strategy in our annual report, it reflects our commitment to equity and reconciliation. The NHS programs that we deliver are anchored in a human rights-based approach. And key highlights of that are our principles of nondiscrimination, inclusion, participation and accountability. We will continue to take actions to eliminate racism and embed equity and reconciliation into our culture, programs and policies, so that they truly reflect the lived experience of all people living in Canada. And we had and still have to learn and unlearn and to reflect our own internal policies and practices, and we do this with humility. But I am committed to remaining accountable and thus driving towards a continuous improvement in this area. Thank you.
[Only Samantha’s voice is heard. She’s not shown on the screen. She speaks English.]
>>SAMANTHA JONES: Thank you so much, Romy.
[The screen focus is on Samantha again while she still speaks English.]
>>SAMANTHA JONES: I'll move on to the sixth question. "There is no law in Canada requiring that new housing be fully accessible or to have a universal design. What work does CMHC do in helping with this issue?" For this one, I call upon Lisa, please.
[Samantha welcomes Lisa with a big smile on her face. The screen is divided into two again. Lisa reappears at the right side of the screen. She starts speaking English with a calm tone of voice while Samantha listens at the left side of the screen.]
>>LISA WILLIAMS: Thanks, Samantha. This question is actually quite similar to one that's been asked by Kate in the chat as well. And so hopefully, Kate, this will give you some additional information to your question as well.
[The screen focus is only on Lisa. She still speaks English.]
>>LISA WILLIAMS: Increasing the amount of accessible housing in Canada's housing stock is an issue we are addressing from our commercial side as well as through the delivery of our government programming.
[00:45:01]
>>LISA WILLIAMS: Government funded programs under the National Housing Strategy, such as the National Housing Co-Investment Fund, and the Affordable Housing Innovation Fund have accessibility built right into them. The National Housing Co-Investment Fund has accessibility requirements for new construction. Applications to the fund must demonstrate either that 20 percent of the project's units meet accessibility standards and that common areas are barrier-free, or that the entire project has full universal design. Applications for the Innovation Fund, on the other hand, are prioritized in part based on how they support increasing accessible housing stock. We also support research and development on accessible housing, as multiple projects are being funded through the National Housing Strategy Solutions Labs Program. For example, the future of Home Solutions Lab, carried out by Edmonton's Skills Society, addresses the gaps in housing for people with developmental disabilities. And that's just one example. On our commercial side, our new multi-unit mortgage loan insurance product, MLI Select, that was mentioned earlier, incentivizes accessibility as well. It uses a point system to incentivize developers to preserve and create rental units that are accessible, affordable and climate compatible.
[Screen focus is only on Samantha. Samantha starts speaking English with a big smile on her face.]
>>SAMANTHA JONES: Thank you, Lisa.
[The screen is divided into two again. Lisa Williams reappears at the left side of the screen. Samantha still speaks English.]
>> SAMANTHA JONES: And I'll move on to the next question. "What is CMHC's work and research in relation to seniors housing? How has this changed over the past year? And any future plans?" Maybe, Lisa, you can take this one as well.
[Lisa answers with a big smile. Samantha smiles back at her.]
>>LISA WILLIAMS: Sure. Thanks.
>>SAMANTHA JONES: Thank you.
[The screen focus is only on Lisa.]
>>LISA WILLIAMS: Seniors are among the groups who are more likely to experience housing needs. And they face particular challenges in finding suitable housing. That's why CMHC and the National Housing Strategy prioritized seniors housing. For example, the National. Housing Co-Investment Fund that I just mentioned, and the Rapid Housing Initiative, the main affordable housing program under the National Housing Strategy, both include seniors among their priority groups. The result has been nearly 50,000 homes either built or repaired, specifically with seniors in mind. We have also supported research projects specifically looking at seniors housing, such as the Aging in the Right Place initiative, based at Simon Fraser University. However, as you know, as part of a review of our suite of surveys and publications, we have decided to discontinue data collection for rents, vacancies and services for the Seniors' Housing Survey in 2021. This data is no longer available going forward because the survey data was used by a small segment of clients. In support of corporate priorities, CMHC will primarily focus its data, research and its insights efforts on investments required for housing needs, market housing supply and demand, racism and discrimination as barriers to housing, the effects of climate change, effectiveness of current and potential future policies and indigenous housing issues.
[Samantha’s voice is heard. She doesn’t appear on the screen.]
>>SAMANTHA JONES: Thank you.
[The screen focus is only on Samantha again.]
>>SAMANTHA JONES: So, we have taken up all the time allowed for questions from the attendees. We'll now move on to questions from members of the media. I would now like to turn it over to CMHC's Manager of Media Relations, Jed Kahane, who will be monitoring this portion of the call. Off to you.
[Screen is divided into two again. Samantha welcomes Jed Kahane with a smile on her face. Jed Kahane appears at the right side of the screen. He wears glasses, a blue suit with a white shirt. He starts speaking English. There are flowers on the background. The roofs of other buildings are also seen from the window of Jed’s room.]
>>JED KAHANE: Thank you very much.
[Jed starts speaking French. Interpreter starts interpreting.]
>>INTERPRETER1: Thank you, Samantha.
[Jed starts speaking English again.]
>>JED KAHANE: For members of the media, simply press star, and then one on your telephone. I remind you that, in order to submit a question, media representatives will need to be on a conference call, as the webcast portion of this does not permit you to ask questions from that platform. Participants will be allowed one question about CMHC and its activities and one follow-up question. Please limit your questions to today's presentation and the contents of the annual report.
[Jed starts speaking French. Interpreter starts interpreting.]
[The presentation starts with a white page. There is a text that says “Thank you!” with gradient effect with the colors from dark blue to orange at the left top of the screen. There’s a square frame on the right side of the screen. There’s a gray text inside the frame. It says: Media Questions. “Canada” is written under the frame, at the right bottom of the screen with CMHC – SCHL logo next to it. And at the left bottom of the page, there are icons of social media accounts. (Twitter, LinkedIn, Facebook, Instagram and YouTube). In front of the icons, the website “CMHC.ca” is written with gray. Jed is seen at the right side of the screen with a small screen portion.]
>>INTERPRETER1: Participants may ask one question to CMHC and its activities and for the follow-up questions, please, reserve your questions or limit your questions to the content of today's annual public meeting.
[Jed starts speaking English.]
>>JED KAHANE: If you are watching on the webcast as well, please make sure you turn down the volume on your Zoom call when asking your question.
[Jed starts speaking French. Interpreter starts interpreting.]
>>INTERPRETER1: If you're looking at the webcast, please lower your volume on your Zoom before asking questions. And please identify yourself before asking a question and indicate the person to whom the question is addressed.
[A woman’s voice is heard. She speaks English.]
>>WOMAN: Thank you. Our first question of the [She speaks French.] from The Globe and Mail. Please go ahead.
[Another woman’s voice is heard. She speaks English, as well.]
>>WOMAN2: Hi. Thank you. This question is directed to Romy. I'm wondering if CMHC has regained its market share since changing your underwriting rules in July 2021. If you could tell me what your market share is today.
[00:50:08]
[Romy reappears right under Jed’s screen portion. She has a small screen portion, as well. She starts speaking English.]
>>ROMY BOWERS: Yes. Thank you for your question. So, after the underwriting changes, our market share fell into the low twenties, and currently, it's in the mid-thirties. So, we have regained market share and we're working very hard to own the business in this very competitive business.
[The second woman’s voice is heard again.]
>>WOMAN2: But it hasn't changed since this time last year because this time last year was also around 35 percent.
[Romy answers in English.]
>>ROMY BOWERS: Yeah, that's correct. That's correct. So, there is fluctuations from quarter to quarter, but in general, we're very pleased with the progress that we're making year to year.
[Romy disappears. The second woman’s voice is heard again.]
>>WOMAN2: Thank you.
[The first woman’s voice is heard again.]
>>WOMAN1: Once again, please press star one at this time if you have a question.
[She starts speaking French. Interpreter starts interpreting.]
>>INTERPRETER1: Please, press star one to ask a question.
[The woman’s voice is heard again.]
>>WOMAN1: We have no further questions. Back to you.
[Jed starts speaking English.]
>>JED KAHANE: I hope everyone had a chance to get on the call and that concludes the media portion of this call.
[The presentation stops. The screen focus is only on Jed.]
>>JED KAHANE: Journalists who have additional questions can contact our Media Relations office at media@cmhc.ca
[Jed starts speaking French. Interpreter starts interpreting.]
>>INTERPRETER1: Reporters who have more questions can communicate with us by email at media@cmhc.ca. And for those of you who do not have a copy of the annual report and other informational products, you will find them on our website at cmhc.ca.
[The screen is divided into two again. Samantha Jones reappears at the right side of the screen. She starts speaking English with a smile on her face.]
>>SAMANTHA JONES: Thank you very much, everyone. That includes the media portion of our call. I would like to say this brings our annual public meeting and media briefing to a close. Thank you for joining us.
[She starts speaking French. Interpreter starts interpreting.]
>>INTERPRETER1: Thank you and have a nice day.
[00:52:09]