After three years of staggering losses from the housing crisis, MGIC Investment Corp., Milwaukee, defied analysts' expectations and posted a $26.4 million profit for the second quarter.
In the same period a year ago, the company lost nearly $340 million.
On an earnings per share basis, MGIC made $0.13. FBR Capital Markets had predicted a loss of $0.63 per share, while Keefe Bruyette & Woods projected a loss of $0.65 per share. The consensus loss, according to FBR, was $0.71 per share.
The MI took charges of $320 million in 2Q, compared to $770 million in 2Q09. It cited an improving delinquency picture for the turn around.
Its percentage of delinquent loans, including bulk coverage, fell to 17.59% as of June 30, compared to 18.41% at the end of last year, and 14.97% a year ago.
MGIC wrote $2.7 billion of new residential coverage during the quarter, a figure that does not include $639 million of Home Affordable Refinance Program loans. In the second quarter of 2009, MGIC wrote $5.9 billion of new business.
Persistency (or the percentage of insurance remaining in force from one year prior) remained high, at 86.4%. In 2Q it had a persistency ratio of 85.1%
According to figures compiled by National Mortgage News and the Quarterly Data Report, MGIC is the nation's largest MI with more than $207 billion of policies in force.
In Tuesday morning trading its shares were up 5%.
