Stock-Based Compensation

3 Months Ended

Mar. 31, 2016

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

The following table summarizes nonvested common share and nonvested common share unit activity for the three months ended March 31, 2016:



	Time and Performance- Based Share Awards			Time-Based Share Awards				Share Units
(Shares in thousands)	Number of Shares	Weighted Average Grant Date Fair Value		Number of Shares		Weighted Average Grant Date Fair Value		Number of Share Units		Weighted Average Grant Date Fair Value
Outstanding at beginning of year	1,294	$	15.15	890		$	12.31	544		$	19.84
Granted	209	17.01		181		17.01		154		17.01
Vested	—	N/A		(344	)	11.66		(210	)	18.71
Forfeited	—	N/A		(3	)	0.27		(4	)	17.61
Outstanding at March 31, 2016	1,503	$	15.41	724		$	13.85	484		$	19.45

In February 2016, certain members of senior management were granted nonvested common shares under the Essent Group Ltd. 2013 Long-Term Incentive Plan that were subject to time-based and performance-based vesting. The time-based share awards granted in February 2016 vest in three equal installments on March 1, 2017, 2018 and 2019. The performance-based share awards granted in February 2016 vest based upon our compounded annual book value per share growth percentage during a three-year performance period that commenced on January 1, 2016 and vest on March 1, 2019. The portion of the nonvested performance-based share awards that will be earned based upon the achievement of compounded annual book value per share growth is as follows:



Performance level	Compounded Annual Book Value Per Share Growth		Nonvested Common Shares Earned
	<13	%	0	%
Threshold	13	%	25	%
	14	%	50	%
	15	%	75	%
Maximum	≥16	%	100	%

In the event that the compounded annual book value per share growth falls between the performance levels shown above, the nonvested common shares earned will be determined on a straight-line basis between the respective levels shown.

In connection with our incentive program covering bonus awards for performance year 2015, in February 2016, time-based share awards and share units were issued to certain employees that vest in three equal installments on March 1, 2017, 2018 and 2019. In May 2016, 44,360 time-based share units were granted to non-employee directors that vest one year from the date of grant.

The total fair value on the vesting date of nonvested shares or share units that vested was $11.9 million and $16.4 million for the three months ended March 31, 2016 and 2015, respectively. As of March 31, 2016, there was $26.1 million of total unrecognized compensation expense related to nonvested shares or share units outstanding at March 31, 2016 and we expect to recognize the expense over a weighted average period of 2.1 years.

Employees have the option to tender shares to Essent Group to pay the minimum employee statutory withholding taxes associated with shares upon vesting. Common shares tendered by employees to pay employee withholding taxes totaled 177,112 in the three months ended March 31, 2016. The tendered shares were recorded at cost, included in treasury stock and have been cancelled as of March 31, 2016.

Compensation expense, net of forfeitures, and related tax effects recognized in connection with nonvested shares were as follows:



	Three Months Ended March 31,
(In thousands)	2016		2015
Compensation expense	$	3,782	$	3,261
Income tax benefit	1,212		1,141