Nov. 17 (Bloomberg) -- Genworth Financial Inc., the insurer spun off by General Electric Co., rose as much as 33 percent in New York trading after saying it's in talks to buy a Minnesota savings and loan to get funds from the U.S. bailout program.

Genworth gained 28 cents to $1.75 at 9:46 a.m. in New York Stock Exchange composite trading, and earlier rose to $1.95. The Richmond, Virginia-based insurer yesterday said it applied to tap the U.S. Treasury's $700 billion fund for firms hobbled by the worst financial crisis since the Great Depression.

Talks to buy Maple Grove, Minnesota-based InterBank Fsb are in progress, and terms are being negotiated, Genworth spokesman Al Orendorff said yesterday. Genworth shares had declined about 94 percent this year through Nov. 14.

The insurer is seeking capital from the federal government after a surge in claims at its mortgage guaranty unit and investment losses pushed it to two straight quarterly losses. Rivals Hartford Financial Services Group Inc. and Lincoln National Corp. also plan to buy lenders to qualify for government funds.

The companies join more than 50 regional banks that applied to tap the government aid program. Treasury Secretary Henry Paulson's $250 billion recapitalization program injected $125 billion into nine of the largest lenders, and set aside the remainder to buy preferred shares from regional banks.

To contact the reporter on this story: Erik Holm in New York at eholm2@bloomberg.net;

Last Updated: November 17, 2008 09:48 EST