Old Republic Cites Mortgage-Linked Op Loss

Citing the difficult environment in the housing and mortgage lending industries, Old Republic International Corp., Chicago, has reported a net operating loss of $12.2 million ($0.05 per share) for the fourth quarter, compared with net operating income of $103.9 million ($0.45 per share) a year earlier. However, because of realized investment gains of $50 million ($0.14 per share), Old Republic had net income of $20.2 million ($0.09 per share) for the fourth quarter. The mortgage guaranty subsidiary, Republic Mortgage Insurance Co., had a pretax operating loss of $112.6 million, while the title insurance business had a smaller loss of $15.7 million. The mortgage guaranty business saw a 23.6% improvement in net premiums earned compared with those of a year earlier, as traditional new insurance written increased by 85.3% year over year and persistency rose to 77.6% at the end of 2007. But its claims reserve of $644.9 million as of Dec. 31 was 158.4% higher than its level a year earlier.