Genworth Financial (GNW) has full approval to launch a bold plan to reduce risk within the company's U.S. mortgage insurance subsidiary. Earlier this year, the company highlighted an entire plan that takes effect April 1.

The mortgage insurer announced a bold plan in January to reduce the risk of its U.S. mortgage insurance subsidiary facing a potential default or capital shortfall in the future.

Under the plan, the company agreed to transfer ownership of Genworth's European mortgage insurance subsidiaries to its U.S. Mortgage Insurance Co. The strategy also creates a future option for Genworth to develop a new company to write mortgage insurance in all 50 states if an exigent circumstance were to derail its existing MI operations.

Furthermore, Genworth proposed an internal restructuring, creating a new holding company in which its U.S. mortgage insurance subsidiaries will not be covered by an indenture governing Genworth's senior notes.

The company said in a press release that the plan will now be enacted, transferring ownership of the European mortgage insurance subsidiaries to Genworth Mortgage Insurance Corporation.

"U.S. mortgage insurance is a key component of our Global Mortgage Insurance Division, and the plan increases our financial flexibility while bolstering capital in the business to continue writing profitable new business and returning the business to profitability over time," said (), executive vice president and chief financial officer.