Bloomberg the Company & Products

Bloomberg Anywhere Login

Bloomberg

Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.

Company

Financial Products

Enterprise Products

Media

Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000

Communications

Industry Products

Media Services

Follow Us

Mortgage Insurers’ Profits to Return on Housing Surge

June 14 (Bloomberg) -- Mortgage insurers, a group that includes Radian Group Inc. and MGIC Investment Corp., can expect profits to reappear as the firms gain capital during an improving housing market, Standard & Poor’s said.

“A sector some had written off seems to be making a comeback,” Ron Joas, an S&P analyst, said today in a report. “Mortgage insurers seem poised to return to profitability in 2014.”

Joas said a surge of capital into the mortgage-insurance sector amid a rebounding economy has eased concerns that insurers may become insolvent. Private guarantors wrote new policies on $175 billion in mortgages in 2012, more than double the year before, according to data from newsletter Inside Mortgage Finance.

MGIC, based in Milwaukee, hasn’t posted an annual profit since 2006, while Philadelphia-based Radian reported one profitable year in that span. The U.S. Treasury Department said in a report this week that mortgage insurers, hobbled by the financial crisis, are beginning to see a turnaround.

“There are signs of increased capacity,” Treasury’s Federal Insurance Office said. “The industry has attracted new capital since 2010.”

MGIC has surged 130 percent this year, the best performance in the 24-company KBW Insurance Index. It was unchanged $6.13 at 2:44 p.m in New York. Radian, which has also more than doubled since December, declined less than 1 percent to $12.78.

To contact the reporter on this story: Kathleen Chaykowski in San Francisco at kchaykowski2@bloomberg.net

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

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.