PMI Boosts Mortgage Insurance Capital by $92.2m
The PMI Group (PMI) contributed all issued and outstanding common capital shares of its subsidiary PMI Insurance Co. (PIC) to PMI Mortgage Insurance (MIC), boosting MIC’s capital by $92.2m. PMI Mortgage Insurance offers residential mortgage insurance and credit enhancement products. The adjustment comes after PMI reported a $2.7bn loss in its US mortgage insurance operations for Q309. The diversion of funds decreases MIC’s risk-to-capital ratio to 16.9 to 1, from its 18.5 to 1 capital ratio in Q309. During the quarter, Arizona and California passed legislation granting regulators the discretion to decide if a mortgage insurer can continue writing new business if it does no meet a required minimum risk-to-capital minimum level – which is generally 25 to 1. Also, the move increases MIC’s excess minimum policyholders’ position to $307.7m from $215.2m in Q309. Write to Jon Prior.