MGIC Investment Corp. (MTG) swung to a second-quarter loss as
the private-mortgage insurer reported it incurred sharply higher
losses on mortgages it insures.
MGIC, the largest mortgage insurer for both Fannie Mae (FNMA)
and Freddie Mac (FMCC), had recorded a string of narrower losses
recently as its claims losses declined. Insurers like MGIC cover
potential lender losses on loans typically given to borrowers who
can't make a 20% down payment.
MGIC reported a loss of $151.7 million, or 75 cents a share,
compared with a prior-year profit of $24.6 million, or 13 cents a
share. The current period included an 11-cent per-share realized
gain, while the prior-year results included a 17-cent gain. Revenue
slid 9.7% to $367 million amid lower net premiums.
Analysts polled by Thomson Reuters most recently estimated
earnings of 2 cents a share on $346 million in revenue.
The percentage of delinquent loans was 15.80%, compared with
17.59% a year earlier. Claims losses were $459.6 million, up
sharply from $320.1 million a year ago.
Shares closed Friday at $6 and were inactive premarket. The
stock is down 41% since the start of the year.
-By Mia Lamar, Dow Jones Newswires; 212-416-3207;
mia.lamar@dowjones.com