PMI Records $246M 2Q Loss

The PMI Group Inc., Walnut, Creek, Calif., has reported a net loss of $246.3 million ($3.03 per share) for the second quarter, compared with net income of $83.8 million ($0.95 per share) for the same period last year. The company said the loss was primarily due to a net loss of $225.9 million in U.S. mortgage insurance operations owing to increases in paid claims and loss adjustment expenses and additions to the reserve for losses, partially offset by higher net income from its international operations. The company said it is shutting down its Canadian business and restructuring its European subsidiary. In early August, PMI Guaranty paid approximately $144 million of its excess capital to the parent company. It was able to do this because of an agreement to transfer its entire FGIC-related reinsurance portfolio to a third party. Before the end of the third quarter, PMI Group said it expects to reinvest at least 80% of that capital into its U.S. mortgage insurance operations. In addition, as a result of the closure of PMI Canada, PMI Group said it expects to repatriate approximately $60 million of capital to U.S. mortgage insurance operations in the second half of 2008. PMI Group can be found on the Web at http://www.pmigroup.com.