Stewart Profitable in Fourth Quarter

In the third quarter of 2009, Stewart Information Services Corp., Houston, reported that its title insurance operations had regained profitability. Now for the fourth quarter 2009, the entire company has become profitable, with net income of $31 million, compared with a loss of $164 million one year prior. However, for the full year 2009, Stewart lost $51 million, vastly improved over the 2008 loss of $248 million. Included in the fourth quarter net income was a $23.5 million income tax benefit. Stewart also recorded fourth quarter gains of $12.1 million on the sale of investment securities; the sale proceeds were reinvested in similar securities. Title losses for the fourth quarter 2009 were 8.8% of title revenues and included only one defalcation. For the full year, title losses were 7.6% of title revenues, vs. 7.1% in 2008. Stewart cited American Land Title Association data which showed its market share grew from 11.7% for 2007 to 14.7% in the third quarter 2009. As for this year's outlook, Malcolm S. Morris, chairman and co-chief executive, commented "We believe there remains a very challenging market in 2010, and that while sales of both new and existing homes will likely improve compared to 2009, residential refinance volumes are forecast to retreat. Commercial sales and refinance activity will improve in 2010 compared to 2009, although much of it is likely to be distressed driven."