MGIC Mortgage Unit Cut by Moody’s on Capital, Freddie Clash

MGIC Investment Corp. (MTG) had the financial strength rating of its main insurance unit cut by Moody’s Investors Service as losses from backing home loans drain capital.

The rating was lowered to B2 from B1 “due to the continued deterioration of the insurer’s regulatory capital position and to reflect the possible adverse credit implications of its ongoing dispute with Freddie Mac, one of its largest counterparties,” the ratings firm said in a statement today on Milwaukee-based MGIC.

To contact the reporter on this story: Zachary Tracer in New York at ztracer1@bloomberg.net

To contact the editor responsible for this story: Dan Kraut at dkraut2@bloomberg.net

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