FirstAm Takes $67M 4Q Loss

The First American Corp., Santa Ana, Calif., has reported a net loss of $67.5 million for the fourth quarter ($0.74 per share), compared with net income of $104.0 million ($1.06 per share) a year earlier. For the full year, the company lost $3.1 million ($0.03 per share), compared with net income of $287.7 million ($2.92 per share) in 2006. The fourth quarter included a reserve-strengthening adjustment of $122.3 million due to adverse claim development and restructuring expenses of $25.6 million, First American reported. The title insurance segment had a pretax loss of $185.7 million in the fourth quarter, compared with pretax income of $122.7 million a year earlier. The loss provision for claims went from 5.6% of operating revenues in the fourth quarter of 2006 to 14.6% of operating revenues in the most recent period due to higher expected ultimate losses for the book of business written from 2004 to 2006. First American's title business had operating revenues of $1.2 billion for the fourth quarter, down from $1.5 billion a year earlier. First American can be found online at http://www.firstam.com.