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Wednesday, March 05, 2008 8:30:48 AM
Mortgage insurer PMI falls after loss warning
Tue Mar 4, 2008 10:25am EST
NEW YORK (Reuters) - Shares of PMI Group (PMI) fell 6 percent on Tuesday, a day after the mortgage insurer warned of a substantial quarterly loss from its financial guaranty segment.
Late on Monday, the company said several of its units reported fourth-quarter losses on a preliminary basis. It has delayed its final results until it receives financial data from bond insurer FGIC, a company it partly owns.
PMI said it needs FGIC's results to calculate its 2007 results, and was assessing whether its investment in the bond insurer was impaired at the end of the year.
PMI said it expects a significant fourth-quarter net loss from its financial guaranty segment, and reported a net loss of $236 million in its U.S. mortgage insurance operation for the same period. PMI's international operations reported a preliminary net loss of $10.1 million.
PMI, which sells insurance protecting mortgage lenders in the event of defaults, said it was facing challenging market conditions, particularly in the United States.
UBS on Tuesday cut its price target for PMI to $7 from $19, citing an increased likelihood of impairment in the FGIC investment.
PMI shares were down 42 cents to $6.36 in morning trade on the New York Stock Exchange. The shares have fallen 88 percent since last May.
PMI said it will not make any further investments in FGIC or another bond insurer that it has a stake in, Bermuda-based Ram Re (RAMR).
FGIC, which has lost its top credit ratings, has told New York regulators it wants to split itself in two.
http://www.reuters.com/article/hotStocksNews/idUSN0446389120080304
Tue Mar 4, 2008 10:25am EST
NEW YORK (Reuters) - Shares of PMI Group (PMI) fell 6 percent on Tuesday, a day after the mortgage insurer warned of a substantial quarterly loss from its financial guaranty segment.
Late on Monday, the company said several of its units reported fourth-quarter losses on a preliminary basis. It has delayed its final results until it receives financial data from bond insurer FGIC, a company it partly owns.
PMI said it needs FGIC's results to calculate its 2007 results, and was assessing whether its investment in the bond insurer was impaired at the end of the year.
PMI said it expects a significant fourth-quarter net loss from its financial guaranty segment, and reported a net loss of $236 million in its U.S. mortgage insurance operation for the same period. PMI's international operations reported a preliminary net loss of $10.1 million.
PMI, which sells insurance protecting mortgage lenders in the event of defaults, said it was facing challenging market conditions, particularly in the United States.
UBS on Tuesday cut its price target for PMI to $7 from $19, citing an increased likelihood of impairment in the FGIC investment.
PMI shares were down 42 cents to $6.36 in morning trade on the New York Stock Exchange. The shares have fallen 88 percent since last May.
PMI said it will not make any further investments in FGIC or another bond insurer that it has a stake in, Bermuda-based Ram Re (RAMR).
FGIC, which has lost its top credit ratings, has told New York regulators it wants to split itself in two.
http://www.reuters.com/article/hotStocksNews/idUSN0446389120080304
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