FGIC Reports Investor Interest

New York City-based FGIC Corp., the parent of troubled Financial Guaranty Insurance Co., has reported the receipt of a "significant number of indications of interest" from its request for proposals to enhance its capital position. FGIC said it will discuss those proposals with the potential investors over the next several weeks, with definitive proposals to be submitted when the due-diligence process is completed. "We are encouraged to see the high degree of interest that has been expressed in FGIC," FGIC said in a statement. "We plan to work expeditiously to finalize a transaction that is in the best interests of all of our constituents, including our policyholders." The PMI Group, Walnut Creek, Calif., has owned a 42% stake in FGIC since the end of 2003. Lately that stake has been a drag on PMI's earnings. FGIC had a $1.89 billion net loss for the fourth quarter, which resulted in an after-tax loss of $776.1 million for PMI.