PMI Group's third-quarter loss widens
PMI Group Inc. (PMI) saw its third-quarter loss widen as it paid out more in claims and earned less in premiums. The mortgage insurer reported a loss of $281.1 million, or $1.74 per share, compared a loss of $87.9 million, or $1.06 per share, for the same period one year ago. Revenue was $232.9 million, up from $222.5 million in 3Q09. Analysts on average had expected a quarterly loss of 59 cents per share, according to Thomson Reuters. PMI's U.S. mortgage insurance operations had a net loss of $251.6 million in the third quarter compared to a net loss of $110.6 million in the year-ago period. The 3Q10 loss was due primarily to an increase in the valuation allowance with respect to deferred tax assets. Loss adjustment expenses were partially offset by investment gains, the company said. The number of primary loans in default decreased to 131,891 at Sept. 30 from 141,261 in the year-ago period. New notices of default received in the third quarter totaled 29,715 compared to 41,359 in the third quarter of 2009. The primary default rate, measured as a percentage of primary policies in force (which have declined in recent quarters), was 20.4% compared to 19.5% in 3Q09. The total number of pool loans in default decreased to 15,970 from 52,158 a year ago. The decline was due primarily to the restructuring of certain modified pool policies. PMI paid total claims, including loss adjustment expenses, of $322.7 million during the quarter. It earned $139.8 million in net premiums, down from $176.6 million a year ago. For the first nine months of 2010, the company lost $588.7 million, or $4.64 per share, compared to a loss of $425.8 million, or $5.18 per share in the first nine months of 2009. Write to Kerry Curry. The author holds no relevant investments.