The U.S. mortgage insurance business at Genworth Financial Inc., Richmond, Va., nearly halved its year-over-year loss in the third quarter as new flow delinquencies declined 14% from the previous year and new insurance written was up by 13% in the same timeframe. When compared with the second quarter NIW was up 42% as the company gained market share from both the Federal Housing Administration and private MI competitors being forced out of business.
The unit lost $79 million in the quarter, an improvement over the $152 million lost one year prior. Its parent company posted a $29 million profit for the period, down from $83 million one year prior.
Michael Fraizer, chairman and chief executive, commented "U.S. mortgage insurance losses declined due to good loss mitigation results, stability in the aging of loan delinquencies and higher levels of profitable new business."
However, the company is estimating that its combined risk-to-capital ratio as of Sept. 30 is 27.5-to-1 and for its primary operating unit is 30.7-to-1.
That is above the 25-to-1 requirement that a number of states have in place.
Genworth noted it has waivers to operate in 46 states and separately capitalized and licensed entities to do business in the others. Right now, it does business in three states through Genworth Residential Mortgage Assurance Corp.
Genworth also announced plans to do an initial public offering of 40% of the equity in its Australian mortgage insurance subsidiary. The IPO is likely to take place in the second quarter next year.
Its Canadian private MI business made $39 million for the company, while the Australian business made $41 million.
