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Toronto, Ontario, March 4, 2025 – First National Financial Corporation (TSX: FN, TSX: FN.PR.A, TSX: FN.PR.B) (the “Company” or “FNFC”) today announced its financial results for the three and twelve months ended December 31, 2024. The Company derives virtually all of its earnings from its wholly owned subsidiary, First National Financial LP (“FNFLP” or “First National”), one of Canada’s largest non-bank mortgage originators and underwriters.

Fourth Quarter 2024 Summary

• Revenue increased 19% to $600.1 from $503.4 million in Q4 of 2023
• Pre-FMV Income⁽¹⁾ decreased 3% to $74.8 million from $77.1 million in Q4 of 2023 
• Net income was $63.0 million ($1.04 cents per share) compared to $44.2 million ($0.72 per share) in Q4 of 2023

2024 Annual Summary

• Mortgages Under Administration (“MUA”) increased 7% to a record $153.7 billion from $143.5 billion at December 31, 2023
• Revenue increased 10% to $2.2 billion from $2.0 billion in 2023 
• Pre-FMV Income⁽¹⁾ decreased 10% to $290.3 million from $322.2 million in 2023
• Net income was $203.4 million ($3.33 cents per share) compared to $252.8 million ($4.15 per share) in 2023

Management Commentary

“First National’s 2024 performance reflected the resilient nature of our business in the context of changing market and competitive conditions,” said Jason Ellis, President and CEO. “This was particularly evident in the fourth quarter. With the support of our partners and hard work by our team, we responded well to a surge in available opportunities to grow total fourth quarter originations including renewals 27% year over year. This helped to offset relatively lower mortgage volumes in the previous three quarters. For shareholders, business resilience manifested itself in solid profitability, a 33% after tax Pre-FMV(1) return on shareholders’ equity and the 18th increase in our common share dividends in the past 18 years. As we prepare for what is expected to be a strong spring housing market in 2025, our goal is to demonstrate, once again, the value of a stable, resilient business model operated by a team committed to responsive, reliable service.”

¹ Earnings before income taxes and gains and losses on financial instruments (“Pre-FMV Income) is a non-IFRS measure that adjusts income before income taxes by eliminating the impact of changes in fair value by adding back losses on the valuation of financial instruments (except those on mortgage investments) and deducting gains on the valuation of financial instruments (except those on mortgage investments). See Non-GAAP measures.

Fourth Quarter Performance Review

1 This non-IFRS measure adjusts income before income taxes by eliminating the impact of changes in fair value by adding back losses on the valuation of financial instruments (except those on mortgage investments) and deducting gains on the valuation of financial instruments (except those on mortgage investments). See Non-GAAP Measures.

First National’s MUA increased 7% to $153.7 billion at December 31, 2024 from $143.5 billion at December 31, 2023, or 8% on an annualized basis since September 30, 2024. At year end, single-family MUA was $95.8 billion, up 1% from $94.6 billion at December 31, 2023, while commercial MUA was $57.9 billion, up 18% from $49.0 billion a year ago. 

• $58.4 million of net interest revenue earned on securitized mortgages (NII) compared to $58.0 million in the fourth quarter a year ago reflecting a growing portfolio of securitized mortgages  
• $61.7 million of placement fees, up 12% from $55.0 million a year ago due to a 9% increase in placement activity. Per-unit placement fees were similar year over year 
• $65.3 million of mortgage servicing income, compared to $60.0 million a year ago, a 9% increase reflecting growth in our MUA 
• $41.8 million of mortgage investment income compared to $38.0 million a year ago, a 10% increase primarily reflecting higher balances of mortgages accumulated for securitization
• $2.1 million of gains on deferred placement fees compared to $4.9 million a year ago, a 57% decrease as a competitive market made for tighter spreads on the mortgages underlying these fees. 

Outstanding Securities

At December 31, 2024 and March 4, 2025, the Corporation had outstanding: 59,967,429 common shares; 2,984,835 Class A preference shares, Series 1; 1,015,165 Class A preference shares, Series 2; 200,000 November 2025 senior unsecured notes; 200,000 September 2026 unsecured notes; and 200,000 November 2027 senior unsecured notes.

Outlook

Conference Call and Webcast

About First National Financial Corporation

First National Financial Corporation (TSX:FN, TSX:FN.PR.A, TSX:FN.PR.B) is the parent company of First National Financial LP, a Canadian-based originator, underwriter and servicer of predominantly prime residential (single-family and multi-unit) and commercial mortgages. With more than $153 billion in mortgages under administration, First National is one of Canada’s largest non-bank mortgage originators and underwriters and is among the top three lenders in market share in the mortgage broker distribution channel.  For more information, please visit www.firstnational.ca.

¹ Non-GAAP Measures

The Company uses IFRS as its accounting framework. IFRS are generally accepted accounting principles (GAAP) for Canadian publicly accountable enterprises for years beginning on or after January 1, 2011. The Company also refers to certain measures to assist in assessing financial performance. These “non-GAAP measures” such as “Pre-FMV EBITDA” and “After tax Pre-FMV Dividend Payout Ratio” should not be construed as alternatives to net income or loss or other comparable measures determined in accordance with GAAP as an indicator of performance or as a measure of liquidity and cash flow. Non-GAAP measures do not have standard meanings prescribed by GAAP and therefore may not be comparable to similar measures presented by other issuers.

Forward-Looking Information

Certain information included in this news release may constitute forward-looking information within the meaning of securities laws. In some cases, forward-looking information can be identified by the use of terms such as "may", "will, "should", "expect", "plan", "anticipate", "believe", "intend", "estimate", "predict", "potential", "continue" or other similar expressions concerning matters that are not historical facts. Forward-looking information may relate to management's future outlook and anticipated events or results, and may include statements or information regarding the future financial position, business strategy and strategic goals, product development activities, projected costs and capital expenditures, financial results, risk management strategies, hedging activities, geographic expansion, licensing plans, taxes and other plans and objectives of or involving the Company. Particularly, information regarding growth objectives, any future increase in mortgages under administration, future use of securitization vehicles, industry trends and future revenues is forward-looking information. Forward-looking information is based on certain factors and assumptions regarding, among other things, interest rate changes and responses to such changes, the demand for institutionally placed and securitized mortgages, the status of the applicable regulatory regime and the use of mortgage brokers for single family residential mortgages. This forward-looking information should not be read as providing guarantees of future performance or results, and will not necessarily be an accurate indication of whether or not, or the times by which, those results will be achieved. While management considers these assumptions to be reasonable based on information currently available, they may prove to be incorrect. Forward looking-information is subject to certain factors, including risks and uncertainties listed under ‘‘Risks and Uncertainties Affecting the Business’’ in the MD&A, that could cause actual results to differ materially from what management currently expects. These factors include reliance on sources of funding, concentration of institutional investors, reliance on relationships with independent mortgage brokers and changes in the interest rate environment. This forward-looking information is as of the date of this release, and is subject to change after such date. However, management and First National disclaim any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required under applicable securities regulations.

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