Mortgage insurer Triad Guaranty, which is in "wind down" mode, earned $27 million in the fourth quarter and $132 million for the full year, making it (so far) the only publicly traded MI in the U.S. to post positive results in 4Q.
The Winston-Salem-based firm returned to profitability in the second quarter of 2010, but still has a $586 million deficit in its assets because of pending and expected claims.
The company is no longer writing new policies and is letting its current book of business run-off.
Company CEO Ken Jones acknowledged the difference between the firm's assets and liabilities, saying that future premiums earned from loans already on its books will not be enough to meet current and future policyholder obligations.
Its fourth quarter result compare with net income of $54 million for the third quarter and a net loss of $79 million for the fourth quarter 2009. For the full year 2009, Triad lost $596 million.
"We continued to experience a decline in the amount of risk in default that contributed to the sixth consecutive quarter of reserve decreases," the firm said. "Net reserves decreased by $130 million during the 2010 fourth quarter, of which 25% of the decrease was attributable to a change in the frequency factors utilized in our reserve assumptions."
Jones added that, "Persistency, the key driver of our earned premiums, remained at elevated levels compared to historical norms."
