The moribund mortgage insurance business of Old Republic International Corp., Chicago, lost $238 million on a pretax basis in the third quarter, driving the parent company to a $117 million net loss for the period.
In the year ago period the MI business lost $94 million, and ORI as a whole lost $39 million.
Since the end of August, Republic Mortgage Insurance Co. has not written any new policies – thanks to its primary regulator in North Carolina pulling approvals on its risk-to-capital ratio waiver.
In a press statement, ORI said the $155 million of capital committed to RMIC is likely to be fully depleted "in relatively short order" as the company pays claims. As a result, ORI said it is looking at "alternative run-off approaches."
Still, ORI said it has a "long-term strategic interest" in the private mortgage insurance business, and wants to get back into the business in a separately capitalized subsidiary. But this needs approval -- not only from North Carolina regulators but Fannie Mae and Freddie Mac.
Meanwhile, the title insurance business at Old Republic had pretax operating income of $10 million, up from $6 million one year prior, as the company takes advantage of market share dislocation resulting from Fidelity National Financial's acquisition of LandAmerica.
