PMI Group Sees $338.4 Million Q2 Loss in MI Operations – NMP Skip to main content

PMI Group Sees $338.4 Million Q2 Loss in MI Operations

NationalMortgageProfessional.com
Aug 04, 2011

U.S. mortgage insurance (MI) operations for The PMI Group Inc. had a net loss of $338.4 million for the second quarter of 2011, compared to a net loss of $115.6 million for the second quarter of 2010. The loss in the second quarter of 2011 was driven by elevated losses and loss adjustment expenses, the lack of any material tax benefits and, to a lesser extent, lower premiums earned. Lower premiums earned and lower investment income caused PMI's total revenues to decline to $143 million in the second quarter of 2011 from $165.5 million in the second quarter of 2010. New insurance written in the second quarter of 2011 was $1.4 billion compared to $1.5 billion in the first quarter of 2011 and $1.6 billion in the second quarter of 2010. As of June 30, 2011, primary insurance in force was $96.9 billion compared to $99.3 billion at March 31, 2011 and $107.6 billion at June 30, 2010. PMI's Homeownership Preservation Initiatives (HPI) assisted 6,842 borrowers, representing approximately $295 million of risk-in-force, to retain their homes through loan modifications and payment plans in the second quarter of 2011. This compares to 5,644 borrowers and approximately $258 million of risk-in-force in the first quarter of 2011 and 11,408 borrowers and approximately $542 million of risk-in-force in the second quarter of 2010. U.S. Mortgage Insurance Operations' losses and loss adjustment expense (LAE) increased to $429.6 million in the second quarter of 2011 from $239 million in the first quarter of 2011 and $318.6 million in the second quarter of 2010. Of the $429.6 million of losses and LAE in the second quarter of 2011, approximately $187 million related to reserves on new loan delinquencies. The remaining approximately $242.6 million of losses and LAE in the second quarter related to increases in reserve estimates on previously reported defaults. These changes in estimates were driven by decreases in expected future claim denials (net of reinstatements) and, to a lesser extent, claim rate and claim size re-estimations. PMI decreased its expected future claim denials in the second quarter as a result of significant recent increases in the frequency with which servicers have produced documents for previously denied claims. During the second quarter of 2011, the Company paid total claims including LAE of $282.4 million compared to $204.6 million in the first quarter of 2011 and $444.3 million in the second quarter of 2010. As of June 30, 2011, reserves for losses and LAE, gross of reinsurance recoverables, were $3 billion compared to $2.9 billion at March 31, 2011 and $3 billion at June 30, 2010. The number of primary loans in default decreased to 115,742 as of June 30, 2011 from 119,748 as of March 31, 2011 and 138,431 as of June 30, 2010. New notices of default received in the second quarter of 2011 totaled 22,796 compared to 24,754 in the first quarter of 2011 and 28,597 in the second quarter of 2010. The total number of pool loans in default decreased to 13,163 as of June 30, 2011 compared to 13,769 as of March 31, 2011 and 17,640 as of June 30, 2010. The significant decline in pool loans in default from the prior year was due primarily to the restructuring of modified pool policies.  
Published
Aug 04, 2011
Ginnie Mae Exits The Stone Age And Embraces Blockchain

'Some of the procurement stuff that we do, maybe it’s archaic, maybe it needs to be innovated.'

Industry News
Jan 26, 2022
Katten Partner To Head Women In Securitization

Katten announced that Claudine Chen-Young, a partner in its Structured Finance and Securitization practice in Washington, is the newly named chair of Women in Securitization.

Industry News
Jan 26, 2022
AFR Adds Director Of Marketing

American Financial Resources, Inc. named Lauren Blackburn as its director of marketing, where she will be tasked with driving the company's marketing strategy.

Community
Jan 26, 2022
Standard Communities Creates Affordable Housing For The 'Missing Middle'

Standard Communities is taking over housing stock in the least affordable areas in America.

Industry News
Jan 26, 2022
KBRA Assigns Preliminary Ratings To CSMC 2022-NQM1 Trust

Kroll Bond Rating Agency assigned preliminary ratings to CSMC 2022-NQM1, a $553.7 million non-prime RMBS transaction sponsored by DLJ Mortgage Capital, Inc.

Non-QM
Jan 25, 2022
Hunt Mortgage Appoints Chief Operating Officer

Bindiya Jain previously has served as a vice president at South Shore Bank and at UniBank for Saving. 

Industry News
Jan 25, 2022