Exhibit 99.1
NEWS RELEASE | ||
Investors and Media Contacts: | ||
Bill Horning / Tom Taggart | ||
925.658.6193 / 925.658.6511 |
THE PMI GROUP, INC. REPORTS
FOURTH QUARTER AND YEAR END 2008 FINANCIAL RESULTS
Walnut Creek, CA, March 16, 2009 - The PMI Group, Inc. (NYSE: PMI) (the “Company”) today reported a loss from continuing operations for the fourth quarter of 2008 of $181.0 million, or $2.22 per basic and diluted1 share. The loss from continuing operations for the full year of 2008 was $887.2 million, or $10.90 per basic and diluted1 share. The loss from continuing operations for the fourth quarter of 2008 was primarily due to losses and loss adjustment expenses (LAE) in the U.S. Mortgage Insurance Operations and PMI Europe, a decrease in premiums earned and higher net realized investment losses, primarily from the impairment of certain corporate preferred equity securities in U.S. Mortgage Insurance Operations’ investment portfolio.
Three Months Ended December 31, | ||||||||
(Dollars in thousands, except per share data) | 2008 | 2007 | ||||||
Loss from continuing operations | $ | (180,993 | ) | $ | (1,034,303 | ) | ||
Income from discontinued operations, net of income taxes* | 2,148 | 19,884 | ||||||
Net loss | $ | (178,845 | ) | $ | (1,014,419 | ) | ||
Diluted loss from continuing operations per share | $ | (2.22 | ) | $ | (12.76 | ) | ||
Diluted income from discontinued operations per share | 0.03 | 0.25 | ||||||
Diluted net loss per share | $ | (2.19 | ) | $ | (12.51 | ) | ||
* | Includes the results of PMI Australia, PMI Asia and PMI Guaranty. |
The PMI Group, Inc. Full Year Results | ||||||||
Full Year Ended December 31, | ||||||||
(Dollars in thousands, except per share data) | 2008 | 2007 | ||||||
Loss from continuing operations | $ | (887,188 | ) | $ | (1,008,682 | ) | ||
(Loss) income from discontinued operations, net of income taxes* | (41,320 | ) | 93,356 | |||||
Net loss | $ | (928,508 | ) | $ | (915,326 | ) | ||
Diluted loss from continuing operations per share | $ | (10.90 | ) | $ | (11.92 | ) | ||
Diluted (loss) income from discontinued operations per share | (0.50 | ) | 1.11 | |||||
Diluted net loss per share | $ | (11.40 | ) | $ | (10.81 | ) | ||
* | Includes the results of PMI Australia, PMI Asia and PMI Guaranty. |
1 | Due to the net loss in the fourth quarter and full year of 2008, dilutive components of shares outstanding such as stock options were not included in fully diluted shares outstanding as their inclusion would have been anti-dilutive. |
Fourth Quarter 2008 Update:
¡ | The Company sold PMI Asia for 92.5% of the net tangible asset value, or approximately $51.6 million, in an all cash sale. |
Consolidated Continuing Operating Results
Consolidated net premiums writtenfor the fourth quarter and full year totaled $177.5 million and $768.9 million, respectively, compared with $203.1 million and $813.9 million for the same periods one year ago. The decreases were due primarily to lower levels of new insurance written and premium refunds related to rescissions of insurance previously written.
Consolidated premiums earned for the fourth quarter and full year were $184.1 million and $786.2 million, respectively, compared with $210.0 million and $815.4 million for the same periods one year ago. The decreases were due primarily to lower levels of new insurance written and premium refunds related to rescissions of insurance previously written, partially offset by higher persistency in the U.S. Mortgage Insurance Operations.
Consolidated losses and LAE, which includes paid claims, loss adjustment expenses and additions to reserve for losses, for the fourth quarter and full year were $404.5 million and $1,899.3 million, respectively, compared with $542.7 million and $1,122.9 million for the same periods one year ago. The decrease in the fourth quarter compared with the same period one year ago was primarily due to lower net loss reserve additions as a result of a larger benefit from captive reinsurance in U.S. Mortgage Insurance Operations, partially offset by higher paid claims in U.S. Mortgage Insurance Operations and PMI Europe, as well as higher loss reserves in PMI Europe.
Consolidated reserve for losses and LAEtotaled $2.7 billion as of December 31, 2008 compared with $2.5 billion as of September 30, 2008 and $1.2 billion as of December 31, 2007. Reserves for losses and LAE in the U.S. Mortgage Insurance Operations increased in the fourth quarter of 2008 by a gross amount of $274.9 million to $2.6 billion and was partially offset by a $90.0 million credit from reinsurance recoverables, primarily from captive reinsurance agreements. The increase in this quarter, and the year, for reserves for losses and LAE was primarily due to increases in notices of default in the U.S.
Consolidated other underwriting and operating expensesfor the fourth quarter and full year were $58.6 million and $218.6 million, respectively, compared with $47.0 million and $192.9 million for the same periods one year ago. The increases in other underwriting and operating expenses in the fourth quarter and full year 2008 compared to the corresponding periods in 2007 were primarily due to severance related costs from workforce reductions.
The PMI Group, Inc. Fourth Quarter Results by Segment | ||||||||||||||||
Fourth Quarter Total Revenues | Fourth Quarter (Loss) Income from Continuing Operations | |||||||||||||||
(Dollars in millions, except per share data) | 2008 | 2007 | 2008 | 2007 | ||||||||||||
U.S. Mortgage Insurance Operations2 | $ | 184.1 | $ | 231.9 | $ | (174.1 | ) | $ | (236.0 | ) | ||||||
International Operations3 | (8.9 | ) | (3.0 | ) | (30.2 | ) | (30.8 | ) | ||||||||
Financial Guaranty4 | (0 | ) | (38.5 | ) | 16.8 | (765.4 | ) | |||||||||
Corporate and Other5 | 15.8 | 18.1 | 6.5 | (2.1 | ) | |||||||||||
Total | $ | 191.0 | $ | 208.5 | $ | (181.0 | ) | $ | (1,034.3 | ) | ||||||
Diluted (Loss) from Continuing Operations Per Share1 | $ | (2.22 | ) | $ | (12.76 | ) |
May not total due to rounding.
The PMI Group, Inc. Year to Date Results by Segment | ||||||||||||||||
Full Year Ended December 31 Total Revenues | Full Year Ended December 31 (Loss) Income from Continuing Operations | |||||||||||||||
(Dollars in millions, except per share data) | 2008 | 2007 | 2008 | 2007 | ||||||||||||
U.S. Mortgage Insurance Operations2 | $ | 839.4 | $ | 916.0 | $ | (709.5 | ) | $ | (190.8 | ) | ||||||
International Operations3 | 15.8 | 10.6 | (87.0 | ) | (35.3 | ) | ||||||||||
Financial Guaranty4 | (90.9 | ) | (38.5 | ) | (124.0 | ) | (734.8 | ) | ||||||||
Corporate and Other5 | 143.4 | 35.2 | 33.4 | (47.8 | ) | |||||||||||
Total | $ | 907.8 | $ | 923.2 | $ | (887.2 | ) | $ | (1,008.7 | ) | ||||||
Diluted (Loss) from Continuing Operations Per Share | $ | (10.90 | ) | $ | (11.92 | ) |
May not total due to rounding.
Supplemental Financial Information
• | The PMI Group, Inc.’s Fourth Quarter 2008 Financial Supplement, Net Operating Income (NOI) Reconciliation, and Supplemental Portfolio Information can all be found atwww.pmi-us.com under Investor Relations. |
ABOUT THE PMI GROUP, INC.
The PMI Group, Inc. (NYSE: PMI), headquartered in Walnut Creek, CA, provides innovative credit, capital, and risk transfer solutions that expand homeownership and fund essential services for our customers and the communities they serve. Through its wholly owned subsidiaries, PMI offers residential mortgage insurance and credit enhancement products. For more information:www.pmi-us.com.
2 “U.S. Mortgage Insurance Operations” includes the results of PMI Mortgage Insurance Co. (PMI), affiliated U.S. reinsurance companies and equity in earnings from CMG Mortgage Insurance Company (CMG MI).
3 “International Operations” includes the results of PMI Europe and PMI Canada.
4 “Financial Guaranty” includes our equity investments in FGIC Corporation (FGIC) and RAM Holdings Ltd. (RAM Re).
5 The “Corporate and Other” segment primarily consists of the holding company, contract underwriting operations and intercompany eliminations.
Cautionary Statement:
Statements in this press release and supplements that are not historical facts, or that relate to future plans, events or performance are “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995. Readers are cautioned that forward-looking statements by their nature involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. Many factors could cause actual results and developments to differ materially from those expressed or implied by forward-looking statements. Such factors include, among others:
• | Potential significant future losses as a result of changes in economic and market conditions, such as a deepening of the current economic recession; decreases in housing demand, mortgage originations or housing values; a further reduction in the liquidity in the capital markets or further contraction of credit markets; further increases in unemployment rates; changes in interest rates or consumer confidence; and/or changes in credit spreads; |
• | our expectation that, as a result of continued losses, we will need to raise significant additional capital (which could take the form of, among other things, debt or equity offerings; relief under the U.S. Treasury’s Financial Stability Plan; and/or reinsurance) and that such additional capital may be necessary in 2009; |
• | the risk that pending discussions with lenders to amend financial covenants and events of default under our credit facility are not completed timely or satisfactorily; |
• | the risk that we may be unable to maintain minimum regulatory risk-to-capital and policyholders surplus requirements; |
• | the limitations we have placed on new business writings and the concentration of our business among a relatively small number of large customers; |
• | the potential future impairment of the value of certain securities held in our investment portfolios as a result of the significant volatility in the capital markets; |
• | the potential that our actual losses may substantially exceed our current loss reserve estimates or that our underwriting policies may not anticipate all risks and/or the magnitude of potential loss; |
• | heightened regulatory and litigation risks faced by the financial services industry, the mortgage insurance industry and PMI; |
• | the aging of our mortgage insurance portfolio and changes in severity or frequency of losses associated with our mortgage insurance policies; |
• | the performance of our insured portfolio of higher risk loans, such as Alternative-A (“Alt-A”) and less than-A loans, and adjustable rate and interest-only loans, which have resulted in increased losses in 2007 and 2008 and are expected to result in further losses; |
• | the risk that Fannie Mae and/or Freddie Mac (collectively, the “GSEs”) determine that we are no longer an eligible provider of mortgage insurance; |
• | changes in persistency rates of our mortgage insurance policies caused by, among other things, changes in refinancing activity and home values; |
• | further downgrades or other ratings actions with respect to our credit ratings or insurer financial strength ratings assigned by the major rating agencies; |
• | heightened competition from the Federal Housing Administration and the Veterans’ Administration or other private mortgage insurers; |
• | potential changes in the charters or business practices of the GSEs, the largest purchasers of mortgages; |
• | volatility in our earnings caused by changes in the fair value of our derivative contracts and our need to reevaluate the premium deficiencies in our mortgage insurance business on a quarterly basis; and |
• | potential additional losses in our European operations as a result of deteriorating economic conditions and the potential that we must make additional capital contributions to those operations pursuant to a capital support agreement. |
Other risks and uncertainties are discussed in our SEC filings, including in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2008, filed March 16, 2009. We undertake no obligation to update forward-looking statements.
###
THE PMI GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
Three Months Ended December 31, | Year Ended December 31, | |||||||||||||||
2008 | 2007 | 2008 | 2007 | |||||||||||||
(Unaudited) | (Audited) | |||||||||||||||
(Dollars and shares in thousands, except per share data) | ||||||||||||||||
Net premiums written | $ | 177,543 | $ | 203,074 | $ | 768,895 | $ | 813,922 | ||||||||
Revenues | ||||||||||||||||
Premiums earned | $ | 184,122 | $ | 209,968 | $ | 786,159 | $ | 815,440 | ||||||||
Net loss from credit default swaps | (11,714 | ) | (9,483 | ) | (11,275 | ) | (14,447 | ) | ||||||||
Net investment income | 31,552 | 32,266 | 138,377 | 132,552 | ||||||||||||
Net realized investment (losses) gains | (26,348 | ) | 11,151 | (48,342 | ) | 13,860 | ||||||||||
Change in fair value of certain debt instruments | 11,647 | — | 123,595 | — | ||||||||||||
Impairment of unconsolidated subsidiaries | — | (38,499 | ) | (90,868 | ) | (38,499 | ) | |||||||||
Other income | 1,722 | 3,087 | 10,141 | 14,279 | ||||||||||||
Total revenues | 190,981 | 208,490 | 907,787 | 923,185 | ||||||||||||
Losses and expenses | ||||||||||||||||
Losses and loss adjustment expenses | 404,457 | 542,722 | 1,899,264 | 1,122,898 | ||||||||||||
Amortization of deferred policy acquisition costs | 4,512 | 48,830 | 18,285 | 87,683 | ||||||||||||
Other underwriting and operating expenses | 58,606 | 47,014 | 218,583 | 192,917 | ||||||||||||
Interest expense | 11,309 | 8,383 | 41,007 | 33,391 | ||||||||||||
Total losses and expenses | 478,884 | 646,949 | 2,177,139 | 1,436,889 | ||||||||||||
Loss before equity in losses from unconsolidated subsidiaries and income taxes | (287,903 | ) | (438,459 | ) | (1,269,352 | ) | (513,704 | ) | ||||||||
Equity in losses from unconsolidated subsidiaries | (5,972 | ) | (791,155 | ) | (51,802 | ) | (741,500 | ) | ||||||||
Loss from continuing operations before income taxes | (293,875 | ) | (1,229,614 | ) | (1,321,154 | ) | (1,255,204 | ) | ||||||||
Income tax benefit from continuing operations | (112,882 | ) | (195,311 | ) | (433,966 | ) | (246,522 | ) | ||||||||
Loss from continuing operations | (180,993 | ) | (1,034,303 | ) | (887,188 | ) | (1,008,682 | ) | ||||||||
Income (loss) from discontinued operations, net of taxes | 2,148 | 19,884 | (41,320 | ) | 93,356 | |||||||||||
Net loss | $ | (178,845 | ) | $ | (1,014,419 | ) | $ | (928,508 | ) | $ | (915,326 | ) | ||||
Diluted loss from continuing operations per share | $ | (2.22 | ) | $ | (12.76 | ) | $ | (10.90 | ) | $ | (11.92 | ) | ||||
Diluted income (loss) from discontinued operations per share | 0.03 | 0.25 | (0.50 | ) | 1.11 | |||||||||||
Diluted net loss per share | $ | (2.19 | ) | $ | (12.51 | ) | $ | (11.40 | ) | $ | (10.81 | ) | ||||
THE PMI GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
December 31, 2008 | December 31, 2007 | |||||
(Audited) | (Audited) | |||||
(Dollars and shares in thousands, except per share data) | ||||||
Assets | ||||||
Investments | $ | 2,221,595 | $ | 2,437,280 | ||
Cash and cash equivalents | 1,483,313 | 354,508 | ||||
Investments in unconsolidated subsidiaries | 150,377 | 309,800 | ||||
Reinsurance recoverables | 482,678 | 36,917 | ||||
Deferred policy acquisition costs | 34,791 | 18,305 | ||||
Property, equipment and software, net of accumulated depreciation and amortization | 131,211 | 157,308 | ||||
Other assets | 320,434 | 302,767 | ||||
Assets - discontinued operations- held for sale | — | 1,453,555 | ||||
Total assets | $ | 4,824,399 | $ | 5,070,440 | ||
Liabilities | ||||||
Reserve for losses and loss adjustment expenses | $ | 2,709,286 | $ | 1,177,309 | ||
Unearned premiums | 111,656 | 136,921 | ||||
Debt | 481,764 | 496,593 | ||||
Other liabilities | 243,468 | 178,275 | ||||
Liabilities - discontinued operations - held for sale | — | 568,380 | ||||
Total liabilities | 3,546,174 | 2,557,478 | ||||
Shareholders’ equity | 1,278,225 | 2,512,962 | ||||
Total liabilities and shareholders’ equity | $ | 4,824,399 | $ | 5,070,440 | ||
Basic shares issued and outstanding | 81,688 | 81,120 | ||||
Book value per share | $ | 15.65 | $ | 30.98 | ||
Note: Please refer toThe PMI Group, Inc. Fourth Quarter 2008 Financial Supplement for additional information.
The PMI Group, Inc.
Fourth Quarter 2008
Financial Supplement
THE PMI GROUP, INC. AND SUBSIDIARIES
FINANCIAL RESULTS AND STATISTICAL INFORMATION FOR THE PERIOD ENDED DECEMBER 31, 2008
Table of Contents
Page | ||
Notes to Financial Results and Statistical Information | 3 | |
Consolidated Results | ||
Consolidated Statements of Operations | 4 | |
Consolidated Balance Sheets | 5 | |
Business Segments Results of Operations - Three Months Ended December 31, 2008 and 2007 | 6 | |
Business Segments Results of Operations - Year Ended December 31, 2008 and 2007 | 7 | |
Business Segments Balance Sheets | 8 | |
U.S. Mortgage Insurance Operations Segment Results | ||
U.S. Mortgage Insurance Operations Segment Results of Operations and Balance Sheets | 9 | |
U.S. Mortgage Insurance Operations Portfolio Characteristics | 10-12 | |
U.S. Mortgage Insurance Operations Default Information | 13 | |
U.S. Mortgage Insurance Operations Analysis of Loss Reserves | 14 | |
CMG Mortgage Insurance Company Statistical Information | 15 | |
International Mortgage Insurance Operations Segment Results | ||
International Operations Segment Results of Operations and Balance Sheets | 16 | |
PMI Europe Quarterly Financial Information | 17 | |
PMI Europe Statistical Information | 18 | |
Financial Guaranty Segment Results | ||
Financial Guaranty Segment Results of Operations and Balance Sheets | 19 | |
Corporate and Other Segment Results | ||
Corporate and Other Segment Results of Operations and Balance Sheets | 20 |
Page 2
THE PMI GROUP, INC. AND SUBSIDIARIES
FINANCIAL RESULTS AND STATISTICAL INFORMATION FOR THE PERIOD ENDED DECEMBER 31, 2008
Notes to Financial Results and Statistical Information:
(1) | Effective January 1, 2008, The PMI Group, Inc. (the “Company”) adopted SFAS No. 159,The Fair Value Option for Financial Assets and Financial Liabilities—Including an Amendment of FASB Statement No. 115 (“SFAS No. 159”). The Company elected to adopt the fair value option for certain corporate debt on the adoption date. The Company’s net income included a $11.6 million and $123.6 million gain for the three months and year ended December 31, 2008, respectively, related to fair value adjustments for these debt instruments. |
(2) | At September 30, 2008, the carrying value of our investment in RAM Reinsurance Company, Ltd. (“RAM Re”) was $6.5 million. During the fourth quarter of 2008, we recognized equity in losses from RAM Re of $6.5 million which decreased our investment in RAM Re to zero. Additionally, the Company impaired its investment in FGIC in the first quarter and reduced the carrying value of its investment in FGIC to zero. This reduction resulted in an $88.0 million net realized investment loss in the consolidated statement of operations and $15.6 million loss in other comprehensive income in the first quarter. Due to the Company’s impairment of its investment in FGIC to zero, the Company did not recognize any equity in earnings (losses) from FGIC in 2008. |
(3) | Other underwriting and operating expenses in the International segment include severance costs related to the reconfiguration of PMI Europe and disposal costs related to PMI Canada in the third and fourth quarters of 2008. |
(4) | For the quarter and year ended December 31, 2008 and 2007, the Company’s equity in earnings (losses) from unconsolidated subsidiaries include CMG Mortgage Insurance Company, CMG Mortgage Reinsurance Company and CMG Mortgage Assurance Company (collectively, “CMG MI”), RAM Re and certain limited partnership interests. |
(5) | Due to the net loss in the quarter and year ended December 31, 2008 and 2007, normally dilutive components of shares outstanding such as stock options were not included in fully diluted shares outstanding as their inclusion would have been anti-dilutive. |
(6) | U.S. Mortgage Insurance Operations segment includes the operating results of PMI Mortgage Insurance Co. and affiliated U.S. mortgage insurance and reinsurance companies (collectively, “PMI”). CMG Mortgage Insurance Company and its affiliates are accounted for under the equity method of accounting and their operating results are in equity in earnings from unconsolidated subsidiaries. |
(7) | International Operations segment includes PMI Europe and PMI Canada. PMI Australia and PMI Asia are reported as discontinued operations for all periods presented. |
(8) | Financial Guaranty segment represents our equity investments in FGIC Corporation and RAM Re. PMI Guaranty Co.’s (“PMI Guaranty”) operating results are reported as discontinued operations for all periods presented. The Company merged PMI Guaranty into its U.S. Mortgage Insurance Operations during the fourth quarter of 2008. See Note 2 above for discussion on impairment of the Company’s investments in RAM Re and FGIC. |
(9) | The Corporate and Other segment includes other income and related operating expenses of PMI Mortgage Services Co.’s investment income, change in fair value of certain debt instruments, interest expense, intercompany eliminations and corporate expenses of the Company; the results of Commercial Loan Insurance Corporation, WMAC Credit Insurance Corporation and equity in earnings (losses) from certain limited partnerships. |
(10) | The loss ratio is expressed as a ratio of losses and loss adjustment expenses (“LAE”) from continuing operations to premiums earned from continuing operations. The expense ratio is expressed as a ratio of the sum of amortization of deferred policy acquisition costs and other underwriting and operating expenses from continuing operations to net premiums written from continuing operations. |
(11) | Pool insurance includes modified pool, GSE pool, old pool and all other pool insurance products for U.S. Mortgage Insurance Operations. As of June 30, 2008, we adjusted pool risk in force to appropriately reflect the effect of loan repayments on risk limits. |
(12) | Loss severity is, for a given period, initial claims paid as a percentage of the total risk in force of loans for which claims were paid. Initial claims paid does not include supplemental and other payments. |
(13) | PMI’s persistency rate was calculated based upon the percentage of primary insurance in force at the beginning of a 12-month period that remains in force at the end of that period. |
(14) | The statutory risk-to-capital ratio is for PMI Mortgage Insurance Co. only. |
(15) | As of data, such as insurance in force, risk in force, policy in force and loans in default, are the same as the recent period end in the total column except for captive agreements which relate to NIW for the periods presented. |
(16) | Included in Supplemental and other is $8.2 million and $34.0 million for the three months and year ended December 31, 2008, respectively, recovered from two captive trust accounts due to the termination of captive agreements. The recovered amount was excluded from the calculation of average claim size for the three months and year ended December 31, 2008. |
Note: | The interim financial and statistical information contained in this material is unaudited. Certain prior periods’ information has been reclassified to conform to the current periods’ presentation. |
The PMI Group, Inc.’s Investor Relations contacts:
Bill Horning | Kosta Karmaniolas | |
Vice President, Investor Relations and Corporate Capital Management and Analysis | Director, Investor Relations and Corporate Capital Management and Analysis | |
(925) 658-6193 | (925) 658-6137 |
Page 3
THE PMI GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
Three Months Ended Dectember 31, | Year Ended December 31, | |||||||||||||||
2008 | 2007 | 2008 | 2007 | |||||||||||||
(Unaudited) | (Audited) | |||||||||||||||
(Dollars and shares in thousands, except per share data) | ||||||||||||||||
Net premiums written | $ | 177,543 | $ | 203,074 | $ | 768,895 | $ | 813,922 | ||||||||
Revenues | ||||||||||||||||
Premiums earned | $ | 184,122 | $ | 209,968 | $ | 786,159 | $ | 815,440 | ||||||||
Net loss from credit default swaps | (11,714 | ) | (9,483 | ) | (11,275 | ) | (14,447 | ) | ||||||||
Net investment income | 31,552 | 32,266 | 138,377 | 132,552 | ||||||||||||
Net realized investment (losses) gains | (26,348 | ) | 11,151 | (48,342 | ) | 13,860 | ||||||||||
Change in fair value of certain debt instruments(1) | 11,647 | — | 123,595 | — | ||||||||||||
Impairment of unconsolidated subsidiaries(2) | — | (38,499 | ) | (90,868 | ) | (38,499 | ) | |||||||||
Other income | 1,722 | 3,087 | 10,141 | 14,279 | ||||||||||||
Total revenues | 190,981 | 208,490 | 907,787 | 923,185 | ||||||||||||
Losses and expenses | ||||||||||||||||
Losses and loss adjustment expenses | 404,457 | 542,722 | 1,899,264 | 1,122,898 | ||||||||||||
Amortization of deferred policy acquisition costs | 4,512 | 48,830 | 18,285 | 87,683 | ||||||||||||
Other underwriting and operating expenses(3) | 58,606 | 47,014 | 218,583 | 192,917 | ||||||||||||
Interest expense | 11,309 | 8,383 | 41,007 | 33,391 | ||||||||||||
Total losses and expenses | 478,884 | 646,949 | 2,177,139 | 1,436,889 | ||||||||||||
Loss before equity in losses from unconsolidated subsidiaries and income taxes | (287,903 | ) | (438,459 | ) | (1,269,352 | ) | (513,704 | ) | ||||||||
Equity in losses from unconsolidated subsidiaries(4) | (5,972 | ) | (791,155 | ) | (51,802 | ) | (741,500 | ) | ||||||||
Loss from continuing operations before income taxes | (293,875 | ) | (1,229,614 | ) | (1,321,154 | ) | (1,255,204 | ) | ||||||||
Income tax benefit from continuing operations | (112,882 | ) | (195,311 | ) | (433,966 | ) | (246,522 | ) | ||||||||
Loss from continuing operations | (180,993 | ) | (1,034,303 | ) | (887,188 | ) | (1,008,682 | ) | ||||||||
Income (loss) from discontinued operations, net of taxes | 2,148 | 19,884 | (41,320 | ) | 93,356 | |||||||||||
Net loss | $ | (178,845 | ) | $ | (1,014,419 | ) | $ | (928,508 | ) | $ | (915,326 | ) | ||||
Diluted loss from continuing operations per share | $ | (2.22 | ) | $ | (12.76 | ) | $ | (10.90 | ) | $ | (11.92 | ) | ||||
Diluted income (loss) from discontinued operations per share | 0.03 | 0.25 | (0.50 | ) | 1.11 | |||||||||||
Diluted net loss per share | $ | (2.19 | ) | $ | (12.51 | ) | $ | (11.40 | ) | $ | (10.81 | ) | ||||
Share data: | ||||||||||||||||
Basic weighted average common shares outstanding | 81,661 | 81,120 | 81,423 | 84,645 | ||||||||||||
Stock options and other dilutive components(5) | — | — | — | — | ||||||||||||
Diluted weighted average common shares outstanding(5) | 81,661 | 81,120 | 81,423 | 84,645 | ||||||||||||
Page 4
THE PMI GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
December 31, 2008 | December 31, 2007 | ||||||
(Audited) | (Audited) | ||||||
(Dollars and shares in thousands, except per share data) | |||||||
Assets | |||||||
Investments: | |||||||
Fixed income securities | $ | 1,997,466 | $ | 2,018,148 | |||
Equity securities: | |||||||
Common | 5,593 | 117,251 | |||||
Preferred | 216,256 | 299,630 | |||||
Short term investments | 2,280 | 2,251 | |||||
Total investments | $ | 2,221,595 | $ | 2,437,280 | |||
Cash and cash equivalents | 1,483,313 | 354,508 | |||||
Investments in unconsolidated subsidiaries | 150,377 | 309,800 | |||||
Reinsurance recoverables | 482,678 | 36,917 | |||||
Deferred policy acquisition costs | 34,791 | 18,305 | |||||
Property, equipment and software, net of accumulated depreciation and amortization | 131,211 | 157,308 | |||||
Other assets | 320,434 | 302,767 | |||||
Assets - discontinued operations - held for sale | — | 1,453,555 | |||||
Total assets | $ | 4,824,399 | $ | 5,070,440 | |||
Liabilities | |||||||
Reserve for losses and loss adjustment expenses | $ | 2,709,286 | $ | 1,177,309 | |||
Unearned premiums | 111,656 | 136,921 | |||||
Debt | 481,764 | 496,593 | |||||
Other liabilities | 243,468 | 178,275 | |||||
Liabilities - discontinued operations - held for sale | — | 568,380 | |||||
Total liabilities | 3,546,174 | 2,557,478 | |||||
Shareholders’ equity | |||||||
Common stock | 1,193 | 1,193 | |||||
Additional paid-in capital, treasury stock and retained earnings | 1,312,711 | 2,196,692 | |||||
Accumulated other comprehensive (loss) income, net of deferred taxes | (35,679 | ) | 315,077 | ||||
Total shareholders’ equity | 1,278,225 | 2,512,962 | |||||
Total liabilities and shareholders’ equity | $ | 4,824,399 | $ | 5,070,440 | |||
Basic shares issued and outstanding | 81,688 | 81,120 | |||||
Book value per share | $ | 15.65 | $ | 30.98 | |||
Page 5
THE PMI GROUP, INC. AND SUBSIDIARIES
BUSINESS SEGMENTS RESULTS OF OPERATIONS - THREE MONTHS ENDED DECEMBER 31, 2008 AND 2007
U.S. Mortgage Insurance Operations(6) | International Operations (7) | Financial Guaranty (8) | Corporate and Other(9) | Consolidated Total | ||||||||||||||||
Three Months Ended December 31, 2008 (Unaudited) | ||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||
Net premiums written | $ | 175,658 | $ | 1,875 | $ | — | $ | 10 | $ | 177,543 | ||||||||||
Revenues | ||||||||||||||||||||
Premiums earned | $ | 180,919 | $ | 3,192 | $ | — | $ | 11 | $ | 184,122 | ||||||||||
Net loss from credit default swaps | — | (11,714 | ) | — | — | (11,714 | ) | |||||||||||||
Net investment income | 28,633 | 509 | — | 2,410 | 31,552 | |||||||||||||||
Net realized investment losses | (25,451 | ) | (896 | ) | — | (1 | ) | (26,348 | ) | |||||||||||
Change in fair value of certain debt instruments(1) | — | — | — | 11,647 | 11,647 | |||||||||||||||
Other income (loss) | 6 | (23 | ) | — | 1,739 | 1,722 | ||||||||||||||
Total revenues (expenses) | 184,107 | (8,932 | ) | — | 15,806 | 190,981 | ||||||||||||||
Losses and expenses | ||||||||||||||||||||
Losses and loss adjustment expenses | 398,010 | 6,447 | — | — | 404,457 | |||||||||||||||
Amortization of deferred policy acquisition costs | 4,129 | 383 | — | — | 4,512 | |||||||||||||||
Other underwriting and operating expenses (revenues) | 52,237 | 12,216 | — | (5,847 | ) | 58,606 | ||||||||||||||
Interest expense | 25 | — | — | 11,284 | 11,309 | |||||||||||||||
Total losses and expenses | 454,401 | 19,046 | — | 5,437 | 478,884 | |||||||||||||||
(Loss) income before equity in (losses) earnings from unconsolidated subsidiaries and income taxes | (270,294 | ) | (27,978 | ) | — | 10,369 | (287,903 | ) | ||||||||||||
Equity in earnings (losses) from unconsolidated subsidiaries(4) | 675 | — | (6,453 | ) | (194 | ) | (5,972 | ) | ||||||||||||
(Loss) income from continuing operations before income taxes | (269,619 | ) | (27,978 | ) | (6,453 | ) | 10,175 | (293,875 | ) | |||||||||||
Income tax (benefit) expense from continuing operations | (95,525 | ) | 2,242 | (23,296 | ) | 3,697 | (112,882 | ) | ||||||||||||
(Loss) income from continuing operations | (174,094 | ) | (30,220 | ) | 16,843 | 6,478 | (180,993 | ) | ||||||||||||
Income (loss) from discontinued operations, net of taxes | — | 3,655 | (1,507 | ) | — | 2,148 | ||||||||||||||
Net (loss) income | $ | (174,094 | ) | $ | (26,565 | ) | $ | 15,336 | $ | 6,478 | $ | (178,845 | ) | |||||||
Loss ratio(10) | 220.0 | % | ||||||||||||||||||
Expense ratio (10) | 32.1 | % | ||||||||||||||||||
Combined ratio | 252.1 | % | ||||||||||||||||||
Three Months Ended December 31, 2007 (Unaudited) | ||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||
Net premiums written | $ | 200,253 | $ | 2,802 | $ | — | $ | 19 | $ | 203,074 | ||||||||||
Revenues | ||||||||||||||||||||
Premiums earned | $ | 206,254 | $ | 3,704 | $ | — | $ | 10 | $ | 209,968 | ||||||||||
Net loss from credit default swaps | — | (9,483 | ) | — | — | (9,483 | ) | |||||||||||||
Net investment income | 27,281 | 2,854 | — | 2,131 | 32,266 | |||||||||||||||
Net realized investment (losses) gains | (1,526 | ) | 8 | — | 12,669 | 11,151 | ||||||||||||||
Impairment of unconsolidated subsidiaries | — | — | (38,499 | ) | — | (38,499 | ) | |||||||||||||
Other (loss) income | (86 | ) | (97 | ) | — | 3,270 | 3,087 | |||||||||||||
Total revenues (expenses) | 231,923 | (3,014 | ) | (38,499 | ) | 18,080 | 208,490 | |||||||||||||
Losses and expenses | ||||||||||||||||||||
Losses and loss adjustment expenses | 520,611 | 22,111 | — | — | 542,722 | |||||||||||||||
Amortization of deferred policy acquisition costs | 46,213 | 2,617 | — | — | 48,830 | |||||||||||||||
Other underwriting and operating expenses | 22,717 | 5,897 | — | 18,400 | 47,014 | |||||||||||||||
Interest expense | 33 | — | — | 8,350 | 8,383 | |||||||||||||||
Total losses and expenses | 589,574 | 30,625 | — | 26,750 | 646,949 | |||||||||||||||
Loss before equity in earnings (losses) from unconsolidated subsidiaries and income taxes | (357,651 | ) | (33,639 | ) | (38,499 | ) | (8,670 | ) | (438,459 | ) | ||||||||||
Equity in earnings (losses) from unconsolidated subsidiaries(4) | 3,474 | — | (794,637 | ) | 8 | (791,155 | ) | |||||||||||||
Loss from continuing operations before income taxes | (354,177 | ) | (33,639 | ) | (833,136 | ) | (8,662 | ) | (1,229,614 | ) | ||||||||||
Income tax benefit from continuing operations | (118,160 | ) | (2,856 | ) | (67,767 | ) | (6,528 | ) | (195,311 | ) | ||||||||||
Loss from continuing operations | (236,017 | ) | (30,783 | ) | (765,369 | ) | (2,134 | ) | (1,034,303 | ) | ||||||||||
Income (loss) from discontinued operations, net of taxes | — | 20,671 | (787 | ) | — | 19,884 | ||||||||||||||
Net loss | $ | (236,017 | ) | $ | (10,112 | ) | $ | (766,156 | ) | $ | (2,134 | ) | $ | (1,014,419 | ) | |||||
Loss ratio(10) | 252.4 | % | ||||||||||||||||||
Expense ratio (10) | 34.4 | % | ||||||||||||||||||
Combined ratio | 286.8 | % |
Page 6
THE PMI GROUP, INC. AND SUBSIDIARIES
BUSINESS SEGMENTS RESULTS OF OPERATIONS - YEAR ENDED DECEMBER 31, 2008 AND 2007
U.S. Mortgage Insurance Operations(6) | International Operations (7) | Financial Guaranty (8) | Corporate and Other(9) | Consolidated Total | ||||||||||||||||
Year Ended December 31, 2008 (Audited) | ||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||
Net premiums written | $ | 750,627 | $ | 18,233 | $ | — | $ | 35 | $ | 768,895 | ||||||||||
Revenues | ||||||||||||||||||||
Premiums earned | $ | 772,173 | $ | 13,942 | $ | — | $ | 44 | $ | 786,159 | ||||||||||
Net loss from credit default swaps | — | (11,275 | ) | — | (11,275 | ) | ||||||||||||||
Net investment income | 115,219 | 12,913 | — | 10,245 | 138,377 | |||||||||||||||
Net realized investment (losses) gains | (47,600 | ) | 261 | — | (1,003 | ) | (48,342 | ) | ||||||||||||
Change in fair value of certain debt instruments(1) | — | — | — | 123,595 | 123,595 | |||||||||||||||
Impairment of unconsolidated subsidiaries(2) | — | — | (90,868 | ) | — | (90,868 | ) | |||||||||||||
Other (loss) income | (351 | ) | 5 | — | 10,487 | 10,141 | ||||||||||||||
Total revenues (expenses) | 839,441 | 15,846 | (90,868 | ) | 143,368 | 907,787 | ||||||||||||||
Losses and expenses | ||||||||||||||||||||
Losses and loss adjustment expenses | 1,835,720 | 63,544 | — | — | 1,899,264 | |||||||||||||||
Amortization of deferred policy acquisition costs | 15,586 | 2,699 | — | — | 18,285 | |||||||||||||||
Other underwriting and operating expenses | 123,368 | 39,903 | — | 55,312 | 218,583 | |||||||||||||||
Interest expense | 139 | — | — | 40,868 | 41,007 | |||||||||||||||
Total losses and expenses | 1,974,813 | 106,146 | — | 96,180 | 2,177,139 | |||||||||||||||
(Loss) income before equity in earnings (losses) from unconsolidated subsidiaries and income taxes | (1,135,372 | ) | (90,300 | ) | (90,868 | ) | 47,188 | (1,269,352 | ) | |||||||||||
Equity in earnings (losses) from unconsolidated subsidiaries(4) | 6,456 | — | (57,670 | ) | (588 | ) | (51,802 | ) | ||||||||||||
(Loss) income from continuing operations before income taxes | (1,128,916 | ) | (90,300 | ) | (148,538 | ) | 46,600 | (1,321,154 | ) | |||||||||||
Income tax (benefit) expense from continuing operations | (419,371 | ) | (3,264 | ) | (24,540 | ) | 13,209 | (433,966 | ) | |||||||||||
(Loss) income from continuing operations | (709,545 | ) | (87,036 | ) | (123,998 | ) | 33,391 | (887,188 | ) | |||||||||||
Loss from discontinued operations, net of taxes | — | (17,200 | ) | (24,120 | ) | — | (41,320 | ) | ||||||||||||
Net (loss) income | $ | (709,545 | ) | $ | (104,236 | ) | $ | (148,118 | ) | $ | 33,391 | $ | (928,508 | ) | ||||||
Loss ratio(10) | 237.7 | % | ||||||||||||||||||
Expense ratio (10) | 18.5 | % | ||||||||||||||||||
Combined ratio | 256.2 | % | ||||||||||||||||||
Year Ended December 31, 2007 (Audited) | ||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||
Net premiums written | $ | 799,747 | $ | 14,123 | $ | — | $ | 52 | $ | 813,922 | ||||||||||
Revenues | ||||||||||||||||||||
Premiums earned | $ | 800,937 | 14,446 | $ | — | $ | 57 | $ | 815,440 | |||||||||||
Net loss from credit default swaps | — | (14,447 | ) | — | — | (14,447 | ) | |||||||||||||
Net investment income | 110,355 | 10,848 | — | 11,349 | 132,552 | |||||||||||||||
Net realized investment gains (losses) | 4,587 | (164 | ) | — | 9,437 | 13,860 | ||||||||||||||
Impairment of unconsolidated subsidiaries(2) | — | — | (38,499 | ) | — | (38,499 | ) | |||||||||||||
Other income (loss) | 85 | (114 | ) | — | 14,308 | 14,279 | ||||||||||||||
Total revenues (expenses) | 915,964 | 10,569 | (38,499 | ) | 35,151 | 923,185 | ||||||||||||||
Losses and expenses | ||||||||||||||||||||
Losses and loss adjustment expenses | 1,096,093 | 26,805 | — | — | 1,122,898 | |||||||||||||||
Amortization of deferred policy acquisition costs | 84,214 | 3,469 | — | — | 87,683 | |||||||||||||||
Other underwriting and operating expenses | 95,557 | 18,104 | — | 79,256 | 192,917 | |||||||||||||||
Interest expense | 108 | — | — | 33,283 | 33,391 | |||||||||||||||
Total losses and expenses | 1,275,972 | 48,378 | — | 112,539 | 1,436,889 | |||||||||||||||
Loss before equity in earnings from unconsolidated subsidiaries and income taxes | (360,008 | ) | (37,809 | ) | (38,499 | ) | (77,388 | ) | (513,704 | ) | ||||||||||
Equity in earnings (losses) from unconsolidated subsidiaries(4) | 17,119 | — | (758,833 | ) | 214 | (741,500 | ) | |||||||||||||
Loss from continuing operations before income taxes | (342,889 | ) | (37,809 | ) | (797,332 | ) | (77,174 | ) | (1,255,204 | ) | ||||||||||
Income tax benefit from continuing operations | (152,073 | ) | (2,529 | ) | (62,576 | ) | (29,344 | ) | (246,522 | ) | ||||||||||
Loss from continuing operations | (190,816 | ) | (35,280 | ) | (734,756 | ) | (47,830 | ) | (1,008,682 | ) | ||||||||||
Income from discontinued operations, net of taxes | — | 90,270 | 3,086 | — | 93,356 | |||||||||||||||
Net (loss) income | $ | (190,816 | ) | $ | 54,990 | $ | (731,670 | ) | $ | (47,830 | ) | $ | (915,326 | ) | ||||||
Loss ratio(10) | 136.9 | % | ||||||||||||||||||
Expense ratio (10) | 22.5 | % | ||||||||||||||||||
Combined ratio | 159.4 | % |
Page 7
THE PMI GROUP, INC. AND SUBSIDIARIES
BUSINESS SEGMENTS BALANCE SHEETS
U.S. Mortgage Insurance Operations(6) | International Operations (7) | Financial Guaranty (8) | Corporate and Other(9) | Consolidated Total | ||||||||||||
December 31, 2008 (Audited) | ||||||||||||||||
(Dollars in thousands) | ||||||||||||||||
Assets | ||||||||||||||||
Investments: | ||||||||||||||||
Fixed income securities | $ | 1,722,432 | $ | 139,804 | $ | — | $ | 135,230 | $ | 1,997,466 | ||||||
Equity securities: | ||||||||||||||||
Common | 5,593 | — | — | — | 5,593 | |||||||||||
Preferred | 216,256 | — | — | — | 216,256 | |||||||||||
Short term investments | 980 | — | — | 1,300 | 2,280 | |||||||||||
Total investments | $ | 1,945,261 | $ | 139,804 | — | $ | 136,530 | $ | 2,221,595 | |||||||
Cash and cash equivalents | 1,239,490 | 124,518 | — | 119,305 | 1,483,313 | |||||||||||
Investments in unconsolidated subsidiaries | 135,082 | — | — | 15,295 | 150,377 | |||||||||||
Reinsurance recoverables | 482,678 | — | — | — | 482,678 | |||||||||||
Deferred policy acquisition costs | 32,317 | 2,474 | — | — | 34,791 | |||||||||||
Property, equipment and software, net of accumulated depreciation | 54,230 | 948 | — | 76,033 | 131,211 | |||||||||||
Other assets (liabilities) | 262,166 | 14,424 | 70,696 | (26,852 | ) | 320,434 | ||||||||||
Total assets | $ | 4,151,224 | $ | 282,168 | $ | 70,696 | $ | 320,311 | $ | 4,824,399 | ||||||
Liabilities | ||||||||||||||||
Reserve for losses and loss adjustment expenses | $ | 2,624,504 | $ | 84,782 | $ | — | $ | — | $ | 2,709,286 | ||||||
Unearned premiums | 86,187 | 25,449 | — | 20 | 111,656 | |||||||||||
Debt | — | — | — | 481,764 | 481,764 | |||||||||||
Other liabilities (assets) | 190,348 | 78,436 | — | (25,316 | ) | 243,468 | ||||||||||
Total liabilities | 2,901,039 | 188,667 | — | 456,468 | 3,546,174 | |||||||||||
Shareholders’ equity (deficit) | 1,250,185 | 93,501 | 70,696 | (136,157 | ) | 1,278,225 | ||||||||||
Total liabilities and shareholders’ equity | $ | 4,151,224 | $ | 282,168 | $ | 70,696 | $ | 320,311 | $ | 4,824,399 | ||||||
December 31, 2007 (Audited) | ||||||||||||||||
(Dollars in thousands) | ||||||||||||||||
Assets | ||||||||||||||||
Investments: | ||||||||||||||||
Fixed income securities | $ | 1,531,606 | $ | 265,653 | $ | 167,915 | $ | 52,974 | $ | 2,018,148 | ||||||
Equity securities: | ||||||||||||||||
Common | 116,005 | 4 | — | 1,242 | 117,251 | |||||||||||
Preferred | 277,165 | — | 22,465 | — | 299,630 | |||||||||||
Short term investments | 951 | — | — | 1,300 | 2,251 | |||||||||||
Total investments | $ | 1,925,727 | $ | 265,657 | $ | 190,380 | $ | 55,516 | $ | 2,437,280 | ||||||
Cash and cash equivalents | 229,446 | 62,298 | 11,252 | 51,512 | 354,508 | |||||||||||
Investments in unconsolidated subsidiaries | 131,225 | — | 163,661 | 14,914 | 309,800 | |||||||||||
Reinsurance recoverables | 35,930 | 987 | — | — | 36,917 | |||||||||||
Deferred policy acquisition costs | 10,474 | 3,921 | 3,910 | — | 18,305 | |||||||||||
Property, equipment and software, net of accumulated depreciation and amortization | 75,884 | 2,095 | 187 | 79,142 | 157,308 | |||||||||||
Other assets | 188,018 | 12,174 | 52,918 | 49,657 | 302,767 | |||||||||||
Assets - discontinued operations - held for sale | — | 1,453,555 | — | — | 1,453,555 | |||||||||||
Total assets | $ | 2,596,704 | $ | 1,800,687 | $ | 422,308 | $ | 250,741 | $ | 5,070,440 | ||||||
Liabilities | ||||||||||||||||
Reserve for losses and loss adjustment expenses | $ | 1,133,080 | $ | 41,579 | $ | 2,650 | $ | — | $ | 1,177,309 | ||||||
Unearned premiums | 107,200 | 22,983 | 6,709 | 29 | 136,921 | |||||||||||
Debt | — | — | 50,000 | 446,593 | 496,593 | |||||||||||
Other liabilities (assets) | 129,246 | 46,652 | 2,892 | (515 | ) | 178,275 | ||||||||||
Liabilities - discontinued operations - held for sale | — | 568,380 | — | — | 568,380 | |||||||||||
Total liabilities | 1,369,526 | 679,594 | 62,251 | 446,107 | 2,557,478 | |||||||||||
Shareholders’ equity (deficit) | 1,227,178 | 1,121,093 | 360,057 | (195,366 | ) | 2,512,962 | ||||||||||
Total liabilities and shareholders’ equity | $ | 2,596,704 | $ | 1,800,687 | $ | 422,308 | $ | 250,741 | $ | 5,070,440 | ||||||
Page 8
THE PMI GROUP, INC. AND SUBSIDIARIES
U.S. MORTGAGE INSURANCE OPERATIONS SEGMENT(6) RESULTS OF OPERATIONS AND BALANCE SHEETS
2008 | 2007 | |||||||||||||||||||||||||||||||||||||||
Income Statement Components - Quarter Ended | 12/31/2008 | 9/30/2008 | 6/30/2008 | 3/31/2008 | Total | 12/31/2007 | 9/30/2007 | 6/30/2007 | 3/31/2007 | Total | ||||||||||||||||||||||||||||||
(Dollars in thousands) | (Dollars in thousands) | |||||||||||||||||||||||||||||||||||||||
Revenues | ||||||||||||||||||||||||||||||||||||||||
Premiums written: | ||||||||||||||||||||||||||||||||||||||||
Gross premiums written | $ | 243,883 | $ | 249,423 | $ | 251,677 | $ | 262,870 | $ | 1,007,853 | $ | 258,026 | $ | 266,545 | $ | 236,412 | $ | 240,430 | $ | 1,001,413 | ||||||||||||||||||||
Ceded and refunded premiums, net of assumed premiums | (68,225 | ) | (75,515 | ) | (55,614 | ) | (57,872 | ) | (257,226 | ) | (57,773 | ) | (52,147 | ) | (47,232 | ) | (44,514 | ) | (201,666 | ) | ||||||||||||||||||||
Net premiums written | 175,658 | 173,908 | 196,063 | 204,998 | 750,627 | 200,253 | 214,398 | 189,180 | 195,916 | 799,747 | ||||||||||||||||||||||||||||||
Change in unearned premiums | 5,261 | 5,887 | 7,572 | 2,826 | 21,546 | 6,001 | (8,859 | ) | 6,205 | (2,157 | ) | 1,190 | ||||||||||||||||||||||||||||
Premiums earned | $ | 180,919 | $ | 179,795 | $ | 203,635 | $ | 207,824 | $ | 772,173 | $ | 206,254 | $ | 205,539 | $ | 195,385 | $ | 193,759 | $ | 800,937 | ||||||||||||||||||||
Net investment income | 28,633 | 29,331 | 29,255 | 28,000 | 115,219 | 27,281 | 28,786 | 25,966 | 28,322 | 110,355 | ||||||||||||||||||||||||||||||
Net realized investment (losses) gains | (25,451 | ) | (50,800 | ) | (12,900 | ) | 41,551 | (47,600 | ) | (1,526 | ) | 2,865 | 981 | 2,267 | 4,587 | |||||||||||||||||||||||||
Other income (loss) | 6 | (190 | ) | (91 | ) | (76 | ) | (351 | ) | (86 | ) | 167 | 17 | (13 | ) | 85 | ||||||||||||||||||||||||
Total revenues | 184,107 | 158,136 | 219,899 | 277,299 | 839,441 | 231,923 | 237,357 | 222,349 | 224,335 | 915,964 | ||||||||||||||||||||||||||||||
Losses and expenses | ||||||||||||||||||||||||||||||||||||||||
Losses and loss adjustment expenses | 398,010 | 348,201 | 552,476 | 537,033 | 1,835,720 | 520,611 | 348,314 | 134,384 | 92,784 | 1,096,093 | ||||||||||||||||||||||||||||||
Amortization of deferred policy acquisition costs | 4,129 | 3,387 | 3,819 | 4,251 | 15,586 | 46,213 | 12,809 | 12,610 | 12,582 | 84,214 | ||||||||||||||||||||||||||||||
Other underwriting and operating expenses | 52,237 | 24,633 | 24,159 | 22,339 | 123,368 | 22,717 | 18,420 | 26,759 | 27,661 | 95,557 | ||||||||||||||||||||||||||||||
Interest expense | 25 | 53 | 29 | 32 | 139 | 33 | 36 | 39 | — | 108 | ||||||||||||||||||||||||||||||
Total losses and expenses | 454,401 | 376,274 | 580,483 | 563,655 | 1,974,813 | 589,574 | 379,579 | 173,792 | 133,027 | 1,275,972 | ||||||||||||||||||||||||||||||
(Loss) income before equity in earnings (losses) from | (270,294 | ) | (218,138 | ) | (360,584 | ) | (286,356 | ) | (1,135,372 | ) | (357,651 | ) | (142,222 | ) | 48,557 | 91,308 | (360,008 | ) | ||||||||||||||||||||||
Equity in earnings (losses) from unconsolidated subsidiaries | 675 | (85 | ) | 2,986 | 2,880 | 6,456 | 3,474 | 4,167 | 4,617 | 4,861 | 17,119 | |||||||||||||||||||||||||||||
(Loss) income before income taxes | (269,619 | ) | (218,223 | ) | (357,598 | ) | (283,476 | ) | (1,128,916 | ) | (354,177 | ) | (138,055 | ) | 53,174 | 96,169 | (342,889 | ) | ||||||||||||||||||||||
Income tax (benefit) expense | (95,525 | ) | (81,108 | ) | (131,739 | ) | (110,999 | ) | (419,371 | ) | (118,160 | ) | (72,833 | ) | 11,627 | 27,293 | (152,073 | ) | ||||||||||||||||||||||
Net (loss) income | $ | (174,094 | ) | $ | (137,115 | ) | $ | (225,859 | ) | $ | (172,477 | ) | $ | (709,545 | ) | $ | (236,017 | ) | $ | (65,222 | ) | $ | 41,547 | $ | 68,876 | $ | (190,816 | ) | ||||||||||||
Loss ratio(10) | 220.0 | % | 193.7 | % | 271.3 | % | 258.4 | % | 237.7 | % | 252.4 | % | 169.5 | % | 68.8 | % | 47.9 | % | 136.9 | % | ||||||||||||||||||||
Expense ratio (10) | 32.1 | % | 16.1 | % | 14.3 | % | 13.0 | % | 18.5 | % | 34.4 | % | 14.6 | % | 20.8 | % | 20.5 | % | 22.5 | % | ||||||||||||||||||||
Combined ratio | 252.1 | % | 209.8 | % | 285.6 | % | 271.4 | % | 256.2 | % | 286.8 | % | 184.1 | % | 89.6 | % | 68.4 | % | 159.4 | % | ||||||||||||||||||||
Balance Sheet Components - As of Quarter End | 12/31/2008 | 9/30/2008 | 6/30/2008 | 3/31/2008 | 12/31/2007 | 9/30/2007 | 6/30/2007 | 3/31/2007 | ||||||||||||||||||||||||||||||||
(Dollars in thousands) | (Dollars in thousands) | |||||||||||||||||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||||||||||
Investments: | ||||||||||||||||||||||||||||||||||||||||
Fixed income securities | $ | 1,722,432 | $ | 1,726,032 | $ | 1,960,626 | $ | 1,746,902 | $ | 1,531,606 | $ | 1,567,122 | $ | 1,523,285 | $ | 1,540,150 | ||||||||||||||||||||||||
Equity securities: | ||||||||||||||||||||||||||||||||||||||||
Common | 5,593 | 9,883 | 10,927 | 14,159 | 116,005 | 135,738 | 141,255 | 129,096 | ||||||||||||||||||||||||||||||||
Preferred | 216,256 | 212,703 | 243,459 | 260,646 | 277,165 | 283,051 | 236,403 | 229,948 | ||||||||||||||||||||||||||||||||
Short term investments | 980 | 980 | 977 | 951 | 951 | 951 | 947 | 930 | ||||||||||||||||||||||||||||||||
Total investments | $ | 1,945,261 | $ | 1,949,598 | $ | 2,215,989 | $ | 2,022,658 | $ | 1,925,727 | $ | 1,986,862 | $ | 1,901,890 | $ | 1,900,124 | ||||||||||||||||||||||||
Cash and cash equivalents | 1,239,490 | 400,086 | 106,317 | 285,074 | 229,446 | 91,460 | 165,114 | 262,327 | ||||||||||||||||||||||||||||||||
Investments in unconsolidated subsidiaries | 135,082 | 132,584 | 135,580 | 133,664 | 131,225 | 127,206 | 122,072 | 137,041 | ||||||||||||||||||||||||||||||||
Reinsurance recoverables | 482,678 | 392,701 | 313,549 | 123,864 | 35,930 | 3,782 | 2,554 | 2,669 | ||||||||||||||||||||||||||||||||
Deferred policy acquisition costs | 32,317 | 28,091 | 22,532 | 15,992 | 10,474 | 43,344 | 43,906 | 43,193 | ||||||||||||||||||||||||||||||||
Property, equipment and software, net of accumulated | 54,230 | 60,000 | 70,330 | 73,832 | 75,884 | 80,170 | 83,293 | 84,448 | ||||||||||||||||||||||||||||||||
Other assets | 262,166 | 298,908 | 264,577 | 242,679 | 188,018 | 186,915 | 139,745 | 124,958 | ||||||||||||||||||||||||||||||||
Total assets | $ | 4,151,224 | $ | 3,261,968 | $ | 3,128,874 | $ | 2,897,763 | $ | 2,596,704 | $ | 2,519,739 | $ | 2,458,574 | $ | 2,554,760 | ||||||||||||||||||||||||
Liabilities | ||||||||||||||||||||||||||||||||||||||||
Reserve for losses and loss adjustment expenses | $ | 2,624,504 | $ | 2,349,651 | $ | 2,132,632 | $ | 1,589,253 | $ | 1,133,080 | $ | 698,238 | $ | 444,594 | $ | 386,036 | ||||||||||||||||||||||||
Unearned premiums | 86,187 | 90,007 | 96,739 | 104,674 | 107,200 | 112,634 | 103,331 | 108,968 | ||||||||||||||||||||||||||||||||
Other liabilities | 190,348 | 200,593 | 115,973 | 185,738 | 129,246 | 205,749 | 265,268 | 347,720 | ||||||||||||||||||||||||||||||||
Total liabilities | 2,901,039 | 2,640,251 | 2,345,344 | 1,879,665 | 1,369,526 | 1,016,621 | 813,193 | 842,724 | ||||||||||||||||||||||||||||||||
Shareholder’s equity | 1,250,185 | 621,717 | 783,530 | 1,018,098 | 1,227,178 | 1,503,118 | 1,645,381 | 1,712,036 | ||||||||||||||||||||||||||||||||
Total liabilities and shareholder’s equity | $ | 4,151,224 | $ | 3,261,968 | $ | 3,128,874 | $ | 2,897,763 | $ | 2,596,704 | $ | 2,519,739 | $ | 2,458,574 | $ | 2,554,760 | ||||||||||||||||||||||||
Page 9
THE PMI GROUP, INC. AND SUBSIDIARIES
U.S. MORTGAGE INSURANCE OPERATIONS PORTFOLIO CHARACTERISTICS (1)
2008 | 2007 | |||||||||||||||||||||||||||||||||||||||
12/31/2008 | 9/30/2008 | 6/30/2008 | 3/31/2008 | Total | 12/31/2007 | 9/30/2007 | 6/30/2007 | 3/31/2007 | Total | |||||||||||||||||||||||||||||||
(Dollars in millions) | (Dollars in millions) | |||||||||||||||||||||||||||||||||||||||
New Insurance Written | ||||||||||||||||||||||||||||||||||||||||
Flow insurance written | $ | 5,725 | $ | 6,156 | $ | 4,364 | $ | 5,952 | $ | 22,197 | $ | 8,701 | $ | 11,091 | $ | 10,268 | $ | 7,524 | $ | 37,584 | ||||||||||||||||||||
Structured insurance written | 24 | 67 | 184 | 167 | 442 | 369 | 3,404 | 1,337 | 3,439 | 8,549 | ||||||||||||||||||||||||||||||
Primary new insurance written | $ | 5,749 | $ | 6,223 | $ | 4,548 | $ | 6,119 | $ | 22,639 | $ | 9,070 | $ | 14,495 | $ | 11,605 | $ | 10,963 | $ | 46,133 | ||||||||||||||||||||
Primary new risk written | $ | 1,322 | $ | 1,413 | $ | 985 | $ | 1,417 | $ | 5,137 | $ | 2,215 | $ | 3,533 | $ | 2,806 | $ | 2,920 | $ | 11,474 | ||||||||||||||||||||
Pool new insurance written(11) | $ | — | $ | — | $ | — | $ | 274 | $ | 274 | $ | 968 | $ | 1,953 | $ | 5,270 | $ | 6,188 | $ | 14,379 | ||||||||||||||||||||
Pool new risk written(11) | $ | — | $ | — | $ | — | $ | 4 | $ | 4 | $ | 14 | $ | 41 | $ | 122 | $ | 178 | $ | 355 | ||||||||||||||||||||
Product mix as a % of primary new insurance written: | ||||||||||||||||||||||||||||||||||||||||
High LTV (above 97% LTV’s) | 0 | % | 0 | % | 4 | % | 15 | % | 5 | % | 21 | % | 31 | % | 35 | % | 36 | % | 32 | % | ||||||||||||||||||||
95.01% to 97% LTV’s | 3 | % | 4 | % | 5 | % | 2 | % | 3 | % | 2 | % | 2 | % | 3 | % | 3 | % | 3 | % | ||||||||||||||||||||
90.01% to 95% LTV’s | 31 | % | 26 | % | 22 | % | 23 | % | 26 | % | 26 | % | 26 | % | 21 | % | 22 | % | 24 | % | ||||||||||||||||||||
85.01% to 90% LTV’s | 52 | % | 55 | % | 49 | % | 44 | % | 50 | % | 40 | % | 30 | % | 31 | % | 27 | % | 31 | % | ||||||||||||||||||||
85% and below | 14 | % | 15 | % | 20 | % | 16 | % | 16 | % | 11 | % | 11 | % | 10 | % | 12 | % | 10 | % | ||||||||||||||||||||
Less than A quality loans | 0 | % | 0 | % | 1 | % | 4 | % | 1 | % | 8 | % | 12 | % | 10 | % | 9 | % | 10 | % | ||||||||||||||||||||
Alt-A loans | 0 | % | 1 | % | 8 | % | 13 | % | 5 | % | 15 | % | 22 | % | 32 | % | 38 | % | 27 | % | ||||||||||||||||||||
Interest only loans | 2 | % | 5 | % | 6 | % | 8 | % | 5 | % | 12 | % | 18 | % | 24 | % | 26 | % | 20 | % | ||||||||||||||||||||
Payment option ARMS | 0 | % | 0 | % | 0 | % | 0 | % | 0 | % | 1 | % | 2 | % | 3 | % | 3 | % | 3 | % | ||||||||||||||||||||
ARMs | 1 | % | 1 | % | 2 | % | 2 | % | 1 | % | 3 | % | 8 | % | 8 | % | 16 | % | 9 | % | ||||||||||||||||||||
Monthlies | 93 | % | 92 | % | 97 | % | 98 | % | 95 | % | 98 | % | 86 | % | 98 | % | 95 | % | 94 | % | ||||||||||||||||||||
Refinances | 25 | % | 22 | % | 41 | % | 45 | % | 33 | % | 36 | % | 31 | % | 38 | % | 47 | % | 37 | % | ||||||||||||||||||||
Structured transactions | 0 | % | 1 | % | 4 | % | 3 | % | 2 | % | 4 | % | 23 | % | 12 | % | 31 | % | 19 | % |
Page 10
THE PMI GROUP, INC. AND SUBSIDIARIES
U.S. MORTGAGE INSURANCE OPERATIONS PORTFOLIO CHARACTERISTICS (2)
2008 | 2007 | |||||||||||||||||||||||||||||||
12/31/2008 | 9/30/2008 | 6/30/2008 | 3/31/2008 | 12/31/2007 | 9/30/2007 | 6/30/2007 | 3/31/2007 | |||||||||||||||||||||||||
(Dollars in millions, except loan size) | ||||||||||||||||||||||||||||||||
Primary Insurance and Risk in Force | ||||||||||||||||||||||||||||||||
Primary insurance in force | ||||||||||||||||||||||||||||||||
Flow | $ | 106,147 | $ | 104,336 | $ | 103,626 | $ | 103,860 | $ | 102,410 | $ | 98,105 | $ | 91,864 | $ | 87,184 | ||||||||||||||||
Structured transactions | 18,118 | 18,806 | 19,525 | 20,403 | 21,213 | 21,864 | 19,803 | 19,701 | ||||||||||||||||||||||||
Total | $ | 124,265 | $ | 123,142 | $ | 123,151 | $ | 124,263 | $ | 123,623 | $ | 119,969 | $ | 111,667 | $ | 106,885 | ||||||||||||||||
Primary risk in force | ||||||||||||||||||||||||||||||||
Flow | $ | 26,329 | $ | 25,981 | $ | 25,983 | $ | 26,156 | $ | 25,852 | $ | 24,754 | $ | 23,075 | $ | 21,837 | ||||||||||||||||
Structured transactions | 4,276 | 4,458 | 4,650 | 4,896 | 5,115 | 5,324 | 5,016 | 5,138 | ||||||||||||||||||||||||
Total | $ | 30,605 | $ | 30,439 | $ | 30,633 | $ | 31,052 | $ | 30,967 | $ | 30,078 | $ | 28,091 | $ | 26,975 | ||||||||||||||||
Pool risk in force(11) | $ | 2,722 | $ | 2,762 | $ | 2,812 | $ | 3,443 | $ | 3,464 | $ | 3,476 | $ | 3,461 | $ | 3,373 | ||||||||||||||||
Primary risk in force - credit score distribution | ||||||||||||||||||||||||||||||||
Flow | ||||||||||||||||||||||||||||||||
620 or above | 94.1 | % | 93.7 | % | 93.4 | % | 93.2 | % | 93.1 | % | 93.1 | % | 93.6 | % | 93.8 | % | ||||||||||||||||
619-575 | 4.6 | % | 4.9 | % | 5.1 | % | 5.3 | % | 5.3 | % | 5.3 | % | 5.0 | % | 4.9 | % | ||||||||||||||||
574 or below | 1.3 | % | 1.4 | % | 1.5 | % | 1.5 | % | 1.6 | % | 1.6 | % | 1.4 | % | 1.3 | % | ||||||||||||||||
Structured transactions | ||||||||||||||||||||||||||||||||
620 or above | 86.2 | % | 86.2 | % | 86.2 | % | 86.2 | % | 86.1 | % | 86.1 | % | 85.4 | % | 85.3 | % | ||||||||||||||||
619-575 | 8.7 | % | 8.7 | % | 8.7 | % | 8.7 | % | 8.8 | % | 8.8 | % | 9.2 | % | 9.2 | % | ||||||||||||||||
574 or below | 5.1 | % | 5.1 | % | 5.1 | % | 5.1 | % | 5.1 | % | 5.1 | % | 5.4 | % | 5.5 | % | ||||||||||||||||
Total | ||||||||||||||||||||||||||||||||
620 or above | 93.0 | % | 92.6 | % | 92.4 | % | 92.1 | % | 91.9 | % | 91.9 | % | 92.1 | % | 92.2 | % | ||||||||||||||||
619-575 | 5.2 | % | 5.5 | % | 5.6 | % | 5.8 | % | 5.9 | % | 5.9 | % | 5.8 | % | 5.7 | % | ||||||||||||||||
574 or below | 1.8 | % | 1.9 | % | 2.0 | % | 2.1 | % | 2.2 | % | 2.2 | % | 2.1 | % | 2.1 | % | ||||||||||||||||
Primary average loan size(in thousands) | ||||||||||||||||||||||||||||||||
Flow | $ | 160.3 | $ | 158.3 | $ | 157.0 | $ | 155.6 | $ | 153.7 | $ | 150.6 | $ | 146.6 | $ | 142.8 | ||||||||||||||||
Structured transactions | $ | 159.4 | $ | 159.9 | $ | 160.3 | $ | 160.8 | $ | 161.7 | $ | 162.0 | $ | 159.6 | $ | 159.2 | ||||||||||||||||
Total | $ | 160.2 | $ | 158.6 | $ | 157.5 | $ | 156.4 | $ | 155.0 | $ | 152.6 | $ | 148.7 | $ | 145.5 | ||||||||||||||||
Loss severity(12) - primary(quarterly) | ||||||||||||||||||||||||||||||||
Flow | 87.4 | % | 100.7 | % | 98.8 | % | 95.7 | % | 95.5 | % | 90.6 | % | 87.9 | % | 88.5 | % | ||||||||||||||||
Structured transactions | 91.9 | % | 98.9 | % | 98.2 | % | 98.9 | % | 94.6 | % | 92.0 | % | 92.5 | % | 90.3 | % | ||||||||||||||||
Total | 89.0 | % | 100.0 | % | 98.6 | % | 96.9 | % | 95.2 | % | 91.1 | % | 89.3 | % | 89.0 | % | ||||||||||||||||
Persistency (13) | ||||||||||||||||||||||||||||||||
Primary persistency rate | 82.2 | % | 81.0 | % | 79.6 | % | 77.6 | % | 75.5 | % | 73.3 | % | 71.7 | % | 70.7 | % | ||||||||||||||||
Risk-to-capital ratio (14) | 18.5 to 1 | 15.8 to 1 | 12.6 to 1 | 12.0 to 1 | 10.8 to 1 | 9.6 to 1 | 8.6 to 1 | 8.3 to 1 |
Page 11
THE PMI GROUP, INC. AND SUBSIDIARIES
U.S. MORTGAGE INSURANCE OPERATIONS PORTFOLIO CHARACTERISTICS (3)
12/31/2008 | 9/30/2008 | 12/31/2007 | |||||||||||||||||||||||||
Policy Year As a Percentage of Primary Risk in Force (RIF) | Primary Risk in Force | Percent of Total | Primary Risk in Force | Percent of Total | Primary Risk in Force | Percent of Total | |||||||||||||||||||||
(In millions) | (In millions) | (In millions) | |||||||||||||||||||||||||
Prior to 1999 | $ | 336 | 1.1 | % | $ | 359 | 1.2 | % | $ | 436 | 1.4 | % | |||||||||||||||
1999 | 273 | 0.9 | % | 279 | 0.9 | % | 312 | 1.0 | % | ||||||||||||||||||
2000 | 122 | 0.4 | % | 126 | 0.4 | % | 144 | 0.5 | % | ||||||||||||||||||
2001 | 438 | 1.4 | % | 457 | 1.5 | % | 539 | 1.7 | % | ||||||||||||||||||
2002 | 956 | 3.1 | % | 998 | 3.3 | % | 1,173 | 3.8 | % | ||||||||||||||||||
2003 | 2,577 | 8.4 | % | 2,691 | 8.8 | % | 3,174 | 10.2 | % | ||||||||||||||||||
2004 | 2,755 | 9.0 | % | 2,862 | 9.4 | % | 3,344 | 10.8 | % | ||||||||||||||||||
2005 | 4,029 | 13.2 | % | 4,189 | 13.8 | % | 4,829 | 15.6 | % | ||||||||||||||||||
2006 | 5,175 | 16.9 | % | 5,384 | 17.7 | % | 6,191 | 20.0 | % | ||||||||||||||||||
2007 | 9,068 | 29.6 | % | 9,435 | 31.0 | % | 10,825 | 35.0 | % | ||||||||||||||||||
2008 | 4,876 | 16.0 | % | 3,659 | 12.0 | % | — | 0.0 | % | ||||||||||||||||||
Total | $ | 30,605 | $ | 30,439 | $ | 30,967 | |||||||||||||||||||||
12/31/2008 | 9/30/2008 | 12/31/2007 | |||||||||||||||||||||||||
% of Primary RIF | Primary Default Rate | % of Primary RIF | Primary Default Rate | % of Primary RIF | Primary Default Rate | ||||||||||||||||||||||
Top 10 States as a Percentage of Primary Risk in Force, (Ranking based on 12/31/08 RIF) |
| ||||||||||||||||||||||||||
Florida | 10.3 | % | 27.8 | % | 10.5 | % | 22.6 | % | 10.8 | % | 10.6 | % | |||||||||||||||
California | 8.0 | % | 24.7 | % | 8.2 | % | 21.0 | % | 8.1 | % | 10.9 | % | |||||||||||||||
Texas | 7.3 | % | 9.4 | % | 7.2 | % | 8.0 | % | 7.2 | % | 6.0 | % | |||||||||||||||
Illinois | 5.2 | % | 14.8 | % | 5.1 | % | 12.6 | % | 5.0 | % | 8.2 | % | |||||||||||||||
Georgia | 4.7 | % | 14.6 | % | 4.7 | % | 12.3 | % | 4.7 | % | 9.5 | % | |||||||||||||||
New York | 3.9 | % | 11.3 | % | 3.8 | % | 9.6 | % | 3.6 | % | 6.8 | % | |||||||||||||||
Ohio | 3.8 | % | 13.5 | % | 3.8 | % | 12.6 | % | 3.8 | % | 10.8 | % | |||||||||||||||
Pennsylvania | 3.3 | % | 10.8 | % | 3.3 | % | 9.7 | % | 3.3 | % | 7.5 | % | |||||||||||||||
New Jersey | 3.2 | % | 14.2 | % | 3.1 | % | 12.0 | % | 3.0 | % | 7.5 | % | |||||||||||||||
Washington | 3.1 | % | 8.1 | % | 3.1 | % | 6.4 | % | 3.1 | % | 3.6 | % | |||||||||||||||
2008 | 2007 | ||||||||||||||||||||||||||
12/31/2008 | 9/30/2008 | 6/30/2008 | 3/31/2008 | 12/31/2007 | 9/30/2007 | 6/30/2007 | 3/31/2007 | ||||||||||||||||||||
As a Percentage of Primary Risk in Force - loan to value ratios | |||||||||||||||||||||||||||
High LTV (above 97% LTV’s) | 21.5 | % | 22.6 | % | 24.0 | % | 24.4 | % | 24.6 | % | 23.9 | % | 22.4 | % | 20.3 | % | |||||||||||
95.01% to 97% LTV’s | 4.1 | % | 4.0 | % | 3.9 | % | 3.8 | % | 3.8 | % | 4.0 | % | 4.3 | % | 4.5 | % | |||||||||||
90.01% to 95% LTV’s | 29.9 | % | 29.4 | % | 29.3 | % | 29.4 | % | 29.5 | % | 29.3 | % | 29.4 | % | 30.1 | % | |||||||||||
85.01% to 90% LTV’s | 37.5 | % | 36.9 | % | 35.7 | % | 35.3 | % | 35.0 | % | 34.9 | % | 35.7 | % | 36.5 | % | |||||||||||
85% and below | 7.0 | % | 7.1 | % | 7.1 | % | 7.1 | % | 7.1 | % | 7.9 | % | 8.2 | % | 8.6 | % | |||||||||||
As a Percentage of Primary Risk in Force: | |||||||||||||||||||||||||||
Less-than-A quality (FICO scores below 620) | 7.1 | % | 7.4 | % | 7.7 | % | 7.9 | % | 8.1 | % | 8.1 | % | 7.9 | % | 7.8 | % | |||||||||||
Less-than-A quality (FICO scores below 575)(A) | 1.8 | % | 1.9 | % | 2.0 | % | 2.1 | % | 2.2 | % | 2.2 | % | 2.1 | % | 2.1 | % | |||||||||||
Alt-A Loans: | |||||||||||||||||||||||||||
With FICO scores of 660 and above | 16.3 | % | 17.4 | % | 19.0 | % | 19.4 | % | 19.6 | % | 20.0 | % | 19.3 | % | 18.3 | % | |||||||||||
With FICO scores below 660 and above 619 | 2.5 | % | 2.6 | % | 2.9 | % | 3.0 | % | 3.2 | % | 3.4 | % | 3.7 | % | 3.8 | % | |||||||||||
Total Alt-A Loans | 18.8 | % | 20.0 | % | 21.9 | % | 22.4 | % | 22.8 | % | 23.4 | % | 23.0 | % | 22.1 | % | |||||||||||
ARMs(B) | 10.3 | % | 11.0 | % | 11.6 | % | 12.1 | % | 12.8 | % | 14.1 | % | 16.0 | % | 17.7 | % | |||||||||||
Interest Only(C) | 11.8 | % | 12.5 | % | 13.8 | % | 14.0 | % | 14.2 | % | 14.2 | % | 13.6 | % | 12.1 | % | |||||||||||
Payment Option ARMs | 3.4 | % | 3.6 | % | 3.7 | % | 3.7 | % | 3.8 | % | 3.9 | % | 4.2 | % | 4.3 | % |
(A) | Less-than-A quality loans with FICO scores below 575 is a subset of PMI’s less-than-A quality loan portfolio. |
(B) | Approximately 1.0% and 0.6% of RIF are subject to initial payment adjustment in 2009 and 2010, respectively. |
(C) | Approximately 97.8% and 95.4% of interest only loans written in 2007 and 2008, respectively, have an initial deferral period of 5 years or greater. |
Page 12
THE PMI GROUP, INC. AND SUBSIDIARIES
U.S. MORTGAGE INSURANCE OPERATIONS DEFAULT INFORMATION
2008 | 2007 | |||||||||||||||||||||||||||||||||||||||
12/31/2008 | 9/30/2008 | 6/30/2008 | 3/31/2008 | Total(15) | 12/31/2007 | 9/30/2007 | 6/30/2007 | 3/31/2007 | Total(15) | |||||||||||||||||||||||||||||||
(Dollars in millions, except claim size) | (Dollars in millions, except claim size) | |||||||||||||||||||||||||||||||||||||||
Primary loans, defaults and default rates | ||||||||||||||||||||||||||||||||||||||||
Primary policies in force | 775,841 | 776,544 | 781,867 | 794,323 | 775,841 | 797,419 | 786,301 | 750,835 | 734,431 | 797,419 | ||||||||||||||||||||||||||||||
Primary loans in default | 109,580 | 93,670 | 80,895 | 69,718 | 109,580 | 63,197 | 50,742 | 42,349 | 39,206 | 63,197 | ||||||||||||||||||||||||||||||
Primary default rate | 14.12 | % | 12.06 | % | 10.35 | % | 8.78 | % | 14.12 | % | 7.93 | % | 6.45 | % | 5.64 | % | 5.34 | % | 7.93 | % | ||||||||||||||||||||
Flow only default rate | 13.00 | % | 10.93 | % | 9.26 | % | 7.57 | % | 13.00 | % | 6.74 | % | 5.38 | % | 4.70 | % | 4.54 | % | 6.74 | % | ||||||||||||||||||||
Structured transactions only default rate | 20.70 | % | 18.41 | % | 16.25 | % | 15.14 | % | 20.70 | % | 13.92 | % | 11.65 | % | 10.37 | % | 9.29 | % | 13.92 | % | ||||||||||||||||||||
Pool default rate | 15.54 | % | 12.74 | % | 10.76 | % | 9.20 | % | 15.54 | % | 7.76 | % | 6.18 | % | 5.17 | % | 4.82 | % | 7.76 | % | ||||||||||||||||||||
Primary default rates by loan type | ||||||||||||||||||||||||||||||||||||||||
Alt-A loans | 30.56 | % | 25.79 | % | 21.67 | % | 17.47 | % | 30.56 | % | 13.86 | % | 9.92 | % | 7.32 | % | 6.06 | % | 13.86 | % | ||||||||||||||||||||
Less than A quality loans | 30.81 | % | 27.25 | % | 23.27 | % | 20.74 | % | 30.81 | % | 20.21 | % | 17.27 | % | 16.83 | % | 16.94 | % | 20.21 | % | ||||||||||||||||||||
Above 97s | 18.28 | % | 15.23 | % | 12.39 | % | 10.18 | % | 18.28 | % | 9.11 | % | 6.98 | % | 6.02 | % | 5.74 | % | 9.11 | % | ||||||||||||||||||||
ARMs (excluding 2/28 Hybrid ARMs) | 32.00 | % | 27.40 | % | 23.41 | % | 19.03 | % | 32.00 | % | 15.48 | % | 11.74 | % | 9.72 | % | 8.43 | % | 15.48 | % | ||||||||||||||||||||
2/28 Hybrid ARMs | 48.46 | % | 47.38 | % | 45.38 | % | 42.95 | % | 48.46 | % | 38.62 | % | 31.00 | % | 22.06 | % | 18.08 | % | 38.62 | % | ||||||||||||||||||||
Payment option ARMs | 38.87 | % | 32.60 | % | 26.72 | % | 19.59 | % | 38.87 | % | 14.46 | % | 9.28 | % | 6.32 | % | 4.34 | % | 14.46 | % | ||||||||||||||||||||
Interest Only | 28.62 | % | 23.53 | % | 19.25 | % | 15.04 | % | 28.62 | % | 10.98 | % | 7.11 | % | 5.02 | % | 4.15 | % | 10.98 | % | ||||||||||||||||||||
Claims paid | ||||||||||||||||||||||||||||||||||||||||
Primary claims paid - flow | $ | 143.7 | $ | 130.1 | $ | 117.2 | $ | 93.0 | $ | 484.0 | $ | 71.0 | $ | 57.7 | $ | 46.7 | $ | 46.9 | $ | 222.3 | ||||||||||||||||||||
Primary claims paid - structured transactions | 79.7 | 76.9 | 71.8 | 59.9 | 288.3 | 34.7 | 29.4 | 21.6 | 18.4 | 104.1 | ||||||||||||||||||||||||||||||
Supplemental and other(16) | (7.4 | ) | (24.6 | ) | 0.9 | 1.8 | (29.3 | ) | 3.5 | 0.6 | (0.5 | ) | (0.4 | ) | 3.2 | |||||||||||||||||||||||||
Total primary claims paid | 216.0 | 182.4 | 189.9 | 154.7 | 743.0 | 109.2 | 87.7 | 67.8 | 64.9 | 329.6 | ||||||||||||||||||||||||||||||
Total pool and other | 8.5 | 17.7 | 2.8 | 7.9 | 36.9 | 5.3 | 4.9 | 4.5 | 4.4 | 19.1 | ||||||||||||||||||||||||||||||
Total claims paid | 224.5 | 200.1 | 192.7 | 162.6 | 779.9 | 114.5 | 92.6 | 72.3 | 69.3 | 348.7 | ||||||||||||||||||||||||||||||
Loss adjustment expenses | 11.6 | 10.2 | 6.1 | 6.2 | 34.1 | 3.4 | 3.3 | 3.4 | 3.5 | 13.6 | ||||||||||||||||||||||||||||||
Total claims paid including loss adjustment expenses | $ | 236.1 | $ | 210.3 | $ | 198.8 | $ | 168.8 | $ | 814.0 | $ | 117.9 | $ | 95.9 | $ | 75.7 | $ | 72.8 | $ | 362.3 | ||||||||||||||||||||
Number of primary claims paid | 5,044 | 4,371 | 4,329 | 3,722 | 17,466 | 2,889 | 2,675 | 2,336 | 2,362 | 10,262 | ||||||||||||||||||||||||||||||
Average primary claim size(in thousands)(16) | $ | 44.4 | $ | 47.6 | $ | 43.9 | $ | 41.6 | $ | 44.5 | $ | 37.8 | $ | 32.8 | $ | 29.0 | $ | 27.5 | $ | 32.1 | ||||||||||||||||||||
Captive reinsurance arrangements | ||||||||||||||||||||||||||||||||||||||||
Percentage of flow NIW subject to captive | 23.2 | % | 19.6 | % | 50.8 | % | 68.4 | % | 39.8 | % | 74.3 | % | 64.2 | % | 60.9 | % | 49.2 | % | 62.7 | % | ||||||||||||||||||||
Percentage of primary NIW subject to captive | 23.1 | % | 19.4 | % | 48.7 | % | 66.5 | % | 39.0 | % | 71.3 | % | 49.1 | % | 53.9 | % | 34.0 | % | 51.1 | % | ||||||||||||||||||||
Percentage of primary IIF subject to captive | 49.0 | % | 50.0 | % | 53.0 | % | 53.0 | % | 51.2 | % | 52.2 | % | 50.2 | % | 50.3 | % | 51.0 | % | 52.2 | % | ||||||||||||||||||||
Percentage of primary RIF subject to captive | 49.5 | % | 50.4 | % | 53.1 | % | 53.1 | % | 51.5 | % | 52.3 | % | 50.2 | % | 50.2 | % | 50.8 | % | 52.3 | % |
Page 13
THE PMI GROUP, INC. AND SUBSIDIARIES
U.S. MORTGAGE INSURANCE OPERATIONS ANALYSIS OF LOSS RESERVES
Loss Reserve Analysis | 2008 | 2007 | ||||||||||||||||||||||||||||||
12/31/2008 | 9/30/2008 | 6/30/2008 | 3/31/2008 | 12/31/2007 | 9/30/2007 | 6/30/2007 | 3/31/2007 | |||||||||||||||||||||||||
(Dollars in millions) | (Dollars in millions) | |||||||||||||||||||||||||||||||
Beginning reserves for losses and LAE, | $ | 2,349.7 | $ | 2,132.6 | $ | 1,589.3 | $ | 1,133.1 | $ | 698.2 | $ | 444.6 | $ | 386.0 | $ | 366.2 | ||||||||||||||||
Reinsurance recoverables | (392.7 | ) | (313.5 | ) | (123.9 | ) | (35.9 | ) | (3.8 | ) | (2.6 | ) | (2.7 | ) | (2.9 | ) | ||||||||||||||||
Net balance at beginning of the period | 1,957.0 | 1,819.1 | 1,465.4 | 1,097.2 | 694.4 | 442.0 | 383.3 | 363.3 | ||||||||||||||||||||||||
Loss and LAE incurred (principally with respect to defaults occuring in): | ||||||||||||||||||||||||||||||||
Current year | 473.8 | 393.5 | 480.4 | 363.2 | 474.8 | 238.1 | 101.4 | 80.1 | ||||||||||||||||||||||||
Prior years | (45.8 | ) | (45.3 | ) | 72.1 | 173.8 | 45.8 | 110.2 | 33.0 | 12.7 | ||||||||||||||||||||||
Total incurred | 428.0 | 348.2 | 552.5 | 537.0 | 520.6 | 348.3 | 134.4 | 92.8 | ||||||||||||||||||||||||
Loss and LAE payments (principally with respect to defaults occuring in): | ||||||||||||||||||||||||||||||||
Current year | (72.7 | ) | (22.7 | ) | (5.4 | ) | (0.1 | ) | (31.3 | ) | (11.3 | ) | (0.9 | ) | (0.1 | ) | ||||||||||||||||
Prior years | (170.5 | ) | (187.6 | ) | (193.4 | ) | (168.7 | ) | (86.5 | ) | (84.6 | ) | (74.8 | ) | (72.7 | ) | ||||||||||||||||
Total payments | (243.2 | ) | (210.3 | ) | (198.8 | ) | (168.8 | ) | (117.8 | ) | (95.9 | ) | (75.7 | ) | (72.8 | ) | ||||||||||||||||
Net ending balance | 2,141.8 | 1,957.0 | 1,819.1 | 1,465.4 | 1,097.2 | 694.4 | 442.0 | 383.3 | ||||||||||||||||||||||||
Reinsurance recoverables(A) | 482.7 | 392.7 | 313.5 | 123.9 | 35.9 | 3.8 | 2.6 | 2.7 | ||||||||||||||||||||||||
Ending reserves for losses and LAE | $ | 2,624.5 | $ | 2,349.7 | $ | 2,132.6 | $ | 1,589.3 | $ | 1,133.1 | $ | 698.2 | $ | 444.6 | $ | 386.0 | ||||||||||||||||
Loss Reserves by Book Year | 12/31/2008 | 9/30/2008 | 6/30/2008 | 3/31/2008 | 12/31/2007 | 12/31/2006 | 12/31/2005 | |||||||||||||||||||||||||
(Dollars in thousands) | (Dollars in thousands) | |||||||||||||||||||||||||||||||
2002 and prior | $ | 137,136 | $ | 131,268 | $ | 125,014 | $ | 134,477 | $ | 117,987 | $ | 103,053 | $ | 149,157 | ||||||||||||||||||
2003 | 118,672 | 111,493 | 101,505 | 95,622 | 87,713 | 65,107 | 80,443 | |||||||||||||||||||||||||
2004 | 166,420 | 157,722 | 152,214 | 133,461 | 119,017 | 76,606 | 80,865 | |||||||||||||||||||||||||
2005 | 406,224 | 382,756 | 371,433 | 298,904 | 238,077 | 83,339 | 35,071 | |||||||||||||||||||||||||
2006 | 774,871 | 687,187 | 633,559 | 462,662 | 345,918 | 38,077 | — | |||||||||||||||||||||||||
2007 | 928,065 | 821,026 | 725,815 | 461,633 | 224,368 | — | — | |||||||||||||||||||||||||
2008 | 93,116 | 58,199 | 23,092 | 2,494 | — | — | — | |||||||||||||||||||||||||
Total Loss Reserves | $ | 2,624,504 | $ | 2,349,651 | $ | 2,132,632 | $ | 1,589,253 | $ | 1,133,080 | $ | 366,182 | $ | 345,536 | ||||||||||||||||||
12/31/2008 | 9/30/2008 | 6/30/2008 | 3/31/2008 | 12/31/2007 | |||||||||||||||||||||
Loans in Default | Reserve for Losses and LAE | Loans in Default | Reserve for Losses and LAE | Loans in Default | Reserve for Losses and LAE | Loans in Default | Reserve for Losses and LAE | Loans in Default | Reserve for Losses and LAE | ||||||||||||||||
(Dollars in millions) | |||||||||||||||||||||||||
Primary insurance | 109,580 | $ | 2,340.0 | 93,670 | $ | 2,195.3 | 80,895 | $ | 2,037.4 | 69,718 | $ | 1,498.9 | 63,197 | $ | 1,054.3 | ||||||||||
Pool insurance (11) | 50,770 | 261.6 | 42,741 | 154.4 | 37,640 | 95.2 | 33,536 | 90.4 | 29,143 | 78.8 | |||||||||||||||
Surety(B) | — | 22.9 | — | — | — | — | — | — | — | — | |||||||||||||||
Total | 160,350 | $ | 2,624.5 | 136,411 | $ | 2,349.7 | 118,535 | $ | 2,132.6 | 103,254 | $ | 1,589.3 | 92,340 | $ | 1,133.1 | ||||||||||
(A) | Reinsurance recoverables includes captive reinsurance agreements and other reinsurance recoverables. |
(B) | Reserve for losses and LAE relates to loss reserves on PMI Guaranty’s surety business with FGIC which was commutated and merged into the Company’s U.S. Mortgage Insurance Operations in the fourth quarter of 2008. |
Page 14
THE PMI GROUP, INC. AND SUBSIDIARIES
CMG MORTGAGE INSURANCE COMPANY STATISTICAL INFORMATION
2008 | 2007 | |||||||||||||||||||||||||||||||||||||||
12/31/2008 | 9/30/2008 | 6/30/2008 | 3/31/2008 | Total(15) | 12/31/2007 | 9/30/2007 | 6/30/2007 | 3/31/2007 | Total(15) | |||||||||||||||||||||||||||||||
(Dollars in millions, except claims paid and claim size) | (Dollars in millions, except claims paid and claim size) | |||||||||||||||||||||||||||||||||||||||
Primary new insurance written | $ | 1,148 | $ | 1,466 | $ | 1,877 | $ | 1,353 | $ | 5,844 | $ | 1,389 | $ | 1,621 | $ | 1,566 | $ | 1,053 | $ | 5,629 | ||||||||||||||||||||
Primary insurance in force | $ | 22,015 | $ | 21,446 | $ | 20,627 | $ | 19,530 | $ | 22,015 | $ | 18,942 | $ | 18,265 | $ | 17,415 | $ | 16,670 | $ | 18,942 | ||||||||||||||||||||
Primary risk in force | $ | 5,465 | $ | 5,334 | $ | 5,137 | $ | 4,871 | $ | 5,465 | $ | 4,721 | $ | 4,532 | $ | 4,292 | $ | 4,085 | $ | 4,721 | ||||||||||||||||||||
Policies in force | 140,128 | 137,979 | 134,451 | 129,032 | 140,128 | 126,342 | 123,164 | 118,933 | 115,224 | 126,342 | ||||||||||||||||||||||||||||||
Primary loans in default | 3,565 | 2,795 | 2,157 | 1,832 | 3,565 | 1,796 | 1,516 | 1,259 | 1,130 | 1,796 | ||||||||||||||||||||||||||||||
Primary default rate | 2.54 | % | 2.03 | % | 1.60 | % | 1.42 | % | 2.54 | % | 1.42 | % | 1.23 | % | 1.06 | % | 0.98 | % | 1.42 | % | ||||||||||||||||||||
Persistency | 85.4 | % | 84.1 | % | 82.6 | % | 81.6 | % | 85.4 | % | 81.6 | % | 80.7 | % | 79.2 | % | 78.5 | % | 81.6 | % | ||||||||||||||||||||
Primary claims paid (in thousands) | $ | 8,432 | $ | 5,929 | $ | 6,051 | $ | 4,033 | $ | 24,445 | $ | 3,726 | $ | 3,235 | $ | 2,392 | $ | 2,131 | $ | 11,484 | ||||||||||||||||||||
Number of primary claims paid | 232 | 169 | 173 | 118 | 692 | 112 | 116 | 83 | 75 | 386 | ||||||||||||||||||||||||||||||
Average primary claim size (in thousands) | $ | 36.3 | $ | 35.1 | $ | 35.0 | $ | 34.2 | $ | 35.3 | $ | 33.3 | $ | 27.9 | $ | 28.8 | $ | 28.4 | $ | 29.8 |
Page 15
THE PMI GROUP, INC. AND SUBSIDIARIES
INTERNATIONAL OPERATIONS SEGMENT(7) RESULTS OF OPERATIONS AND BALANCE SHEETS
2008 | 2007 | |||||||||||||||||||||||||||||||||||||||
Income Statement Components - Quarter Ended | 12/31/2008 | 9/30/2008 | 6/30/2008 | 3/31/2008 | Total | 12/31/2007 | 9/30/2007 | 6/30/2007 | 3/31/2007 | Total | ||||||||||||||||||||||||||||||
(U.S. dollars in thousands) | (U.S. dollars in thousands) | |||||||||||||||||||||||||||||||||||||||
Net premiums written | $ | 1,875 | $ | 2,577 | $ | 6,093 | $ | 7,688 | $ | 18,233 | $ | 2,802 | $ | 4,419 | $ | 3,497 | $ | 3,405 | $ | 14,123 | ||||||||||||||||||||
Revenues | ||||||||||||||||||||||||||||||||||||||||
Premiums earned | $ | 3,192 | $ | 3,776 | $ | 3,769 | $ | 3,205 | $ | 13,942 | $ | 3,704 | $ | 3,644 | $ | 3,519 | $ | 3,579 | $ | 14,446 | ||||||||||||||||||||
Net (losses) gains from credit default swaps | (11,714 | ) | (9,911 | ) | 9,550 | 800 | (11,275 | ) | (9,483 | ) | (8,371 | ) | 1,579 | 1,828 | (14,447 | ) | ||||||||||||||||||||||||
Net investment income | 509 | 3,875 | 3,762 | 4,767 | 12,913 | 2,854 | 2,866 | 2,719 | 2,409 | 10,848 | ||||||||||||||||||||||||||||||
Net realized investment (losses) gains | (896 | ) | 1,868 | (480 | ) | (231 | ) | 261 | 8 | (267 | ) | (16 | ) | 111 | (164 | ) | ||||||||||||||||||||||||
Other (loss) income | (23 | ) | (23 | ) | 23 | 28 | 5 | (97 | ) | 91 | (9 | ) | (99 | ) | (114 | ) | ||||||||||||||||||||||||
Total (expenses) revenues | (8,932 | ) | (415 | ) | 16,624 | 8,569 | 15,846 | (3,014 | ) | (2,037 | ) | 7,792 | 7,828 | 10,569 | ||||||||||||||||||||||||||
Losses and expenses | ||||||||||||||||||||||||||||||||||||||||
Losses and loss adjustment expenses | 6,447 | 34,488 | 3,589 | 19,020 | 63,544 | 22,111 | 2,719 | 1,611 | 364 | 26,805 | ||||||||||||||||||||||||||||||
Amortization of deferred policy acquisition costs | 383 | 1,568 | 403 | 345 | 2,699 | 2,617 | 341 | 284 | 227 | 3,469 | ||||||||||||||||||||||||||||||
Other underwriting and operating expenses(3) | 12,216 | 13,048 | 7,658 | 6,981 | 39,903 | 5,897 | 5,217 | 4,110 | 2,880 | 18,104 | ||||||||||||||||||||||||||||||
Total losses and expenses | 19,046 | 49,104 | 11,650 | 26,346 | 106,146 | 30,625 | 8,277 | 6,005 | 3,471 | 48,378 | ||||||||||||||||||||||||||||||
(Loss) income from continuing operations before income taxes | (27,978 | ) | (49,519 | ) | 4,974 | (17,777 | ) | (90,300 | ) | (33,639 | ) | (10,314 | ) | 1,787 | 4,357 | (37,809 | ) | |||||||||||||||||||||||
Income tax expense (benefits) from continuing operations | 2,242 | (3,510 | ) | 340 | (2,336 | ) | (3,264 | ) | (2,856 | ) | (1,567 | ) | 446 | 1,448 | (2,529 | ) | ||||||||||||||||||||||||
(Loss) income from continuing operations | (30,220 | ) | (46,009 | ) | 4,634 | (15,441 | ) | (87,036 | ) | (30,783 | ) | (8,747 | ) | 1,341 | 2,909 | (35,280 | ) | |||||||||||||||||||||||
Income (loss) from discontinued operations, net of taxes | 1,914 | (51 | ) | 26,469 | 33,217 | 61,549 | 20,671 | 22,626 | 26,756 | 20,217 | 90,270 | |||||||||||||||||||||||||||||
Gain (loss) on sale from discontinued operations, net of taxes | 1,741 | (80,490 | ) | — | — | (78,749 | ) | — | — | — | — | — | ||||||||||||||||||||||||||||
— | ||||||||||||||||||||||||||||||||||||||||
Net (loss) income | $ | (26,565 | ) | $ | (126,550 | ) | $ | 31,103 | $ | 17,776 | $ | (104,236 | ) | $ | (10,112 | ) | $ | 13,879 | $ | 28,097 | $ | 23,126 | $ | 54,990 | ||||||||||||||||
Loss ratio, expense ratio and combined ratio for the International Operations segement are not meaningful due to the sale of PMI Australia and PMI Asia, which were classified as discontinued operations.
Balance Sheet Components - As of Quarter End | 12/31/2008 | 9/30/2008 | 6/30/2008 | 3/31/2008 | 12/31/2007 | 9/30/2007 | 6/30/2007 | 3/31/2007 | ||||||||||||||||
(U.S. dollars in thousands) | (U.S. dollars in thousands) | |||||||||||||||||||||||
Assets | ||||||||||||||||||||||||
Investments: | ||||||||||||||||||||||||
Fixed income and equity securities | $ | 139,804 | $ | 158,171 | $ | 285,814 | $ | 288,047 | $ | 265,657 | $ | 263,807 | $ | 197,165 | $ | 198,445 | ||||||||
Cash and cash equivalents | 124,518 | 164,276 | 64,566 | 61,732 | 62,298 | 63,836 | 106,853 | 23,662 | ||||||||||||||||
Reinsurance recoverables | — | 953 | 1,066 | 1,068 | 987 | 965 | 916 | 904 | ||||||||||||||||
Deferred policy acquisition costs | 2,474 | 2,945 | 4,965 | 5,006 | 3,921 | 5,346 | 4,366 | 3,821 | ||||||||||||||||
Property, equipment and software, net of accumulated depreciation and amortization | 948 | 1,709 | 1,901 | 2,065 | 2,095 | 2,100 | 1,616 | 1,344 | ||||||||||||||||
Other assets | 14,424 | 18,596 | 15,815 | 16,837 | 12,174 | 11,457 | 9,585 | 14,809 | ||||||||||||||||
Assets - discontinued operations - held for sale | — | 1,324,795 | 1,618,497 | 1,522,347 | 1,453,555 | 1,437,828 | 1,353,067 | 1,261,338 | ||||||||||||||||
Total assets | $ | 282,168 | $ | 1,671,445 | $ | 1,992,624 | $ | 1,897,102 | $ | 1,800,687 | $ | 1,785,339 | $ | 1,673,568 | $ | 1,504,323 | ||||||||
Liabilities | ||||||||||||||||||||||||
Reserve for losses and loss adjustment expenses | $ | 84,782 | $ | 90,856 | $ | 62,664 | $ | 60,736 | $ | 41,579 | $ | 20,634 | $ | 18,083 | $ | 17,587 | ||||||||
Unearned premiums | 25,449 | 27,296 | 31,660 | 29,378 | 22,983 | 23,347 | 21,390 | 21,117 | ||||||||||||||||
Other liabilities | 78,436 | 63,124 | 48,915 | 52,694 | 46,652 | 39,436 | 25,304 | 26,793 | ||||||||||||||||
Liabilities - discontinued operations - held for sale | — | 543,830 | 615,441 | 576,681 | 568,380 | 548,164 | 521,888 | 484,030 | ||||||||||||||||
Total liabilities | 188,667 | 725,106 | 758,680 | 719,489 | 679,594 | 631,581 | 586,665 | 549,527 | ||||||||||||||||
Shareholder’s equity | 93,501 | 946,339 | 1,233,944 | 1,177,613 | 1,121,093 | 1,153,758 | 1,086,903 | 954,796 | ||||||||||||||||
Total liabilities and shareholder’s equity | $ | 282,168 | $ | 1,671,445 | $ | 1,992,624 | $ | 1,897,102 | $ | 1,800,687 | $ | 1,785,339 | $ | 1,673,568 | $ | 1,504,323 | ||||||||
Page 16
THE PMI GROUP, INC. AND SUBSIDIARIES
PMI EUROPE QUARTERLY FINANCIAL INFORMATION
2008 | 2007 | |||||||||||||||||||||||||||||||||||||||
Income Statement Components - Quarter Ended | 12/31/2008 | 9/30/2008 | 6/30/2008 | 3/31/2008 | Total | 12/31/2007 | 9/30/2007 | 6/30/2007 | 3/31/2007 | Total | ||||||||||||||||||||||||||||||
(U.S. dollars in thousands, unless otherwise noted) | (U.S. dollars in thousands, unless otherwise noted) | |||||||||||||||||||||||||||||||||||||||
Net premiums written | $ | 1,875 | $ | 2,577 | $ | 6,093 | $ | 5,368 | $ | 15,913 | $ | 2,802 | $ | 4,420 | $ | 3,497 | $ | 3,404 | $ | 14,123 | ||||||||||||||||||||
Revenues | ||||||||||||||||||||||||||||||||||||||||
Premiums earned | $ | 3,051 | $ | 3,598 | $ | 3,660 | $ | 3,156 | $ | 13,465 | $ | 3,704 | $ | 3,644 | $ | 3,519 | $ | 3,579 | $ | 14,446 | ||||||||||||||||||||
Net (losses) gains from credit default swaps | (11,714 | ) | (9,911 | ) | 9,550 | 800 | (11,275 | ) | (9,483 | ) | (8,371 | ) | 1,579 | 1,828 | (14,447 | ) | ||||||||||||||||||||||||
Net investment income | 282 | 3,221 | 2,971 | 3,972 | 10,446 | 1,919 | 2,080 | 2,225 | 2,408 | 8,632 | ||||||||||||||||||||||||||||||
Net realized investment (losses) gains | (4,377 | ) | 874 | (480 | ) | (231 | ) | (4,214 | ) | 6 | (267 | ) | (15 | ) | 112 | (164 | ) | |||||||||||||||||||||||
Other loss | — | — | — | — | — | — | (8 | ) | (26 | ) | (100 | ) | (134 | ) | ||||||||||||||||||||||||||
Total (expenses) revenues | (12,758 | ) | (2,218 | ) | 15,701 | 7,697 | 8,422 | (3,854 | ) | (2,922 | ) | 7,282 | 7,827 | 8,333 | ||||||||||||||||||||||||||
— | ||||||||||||||||||||||||||||||||||||||||
Losses and expenses | ||||||||||||||||||||||||||||||||||||||||
Losses and loss adjustment expenses | 6,288 | 34,386 | 3,589 | 18,975 | 63,238 | 22,111 | 2,719 | 1,611 | 364 | 26,805 | ||||||||||||||||||||||||||||||
Amortization of deferred policy acquisition costs | 311 | 1,565 | 401 | 345 | 2,622 | 2,617 | 341 | 284 | 227 | 3,469 | ||||||||||||||||||||||||||||||
Other underwriting and operating expenses(3) | 6,069 | 9,813 | 5,587 | 4,633 | 26,102 | 4,283 | 3,880 | 3,108 | 2,769 | 14,040 | ||||||||||||||||||||||||||||||
Total losses and expenses | 12,668 | 45,764 | 9,577 | 23,953 | 91,962 | 29,011 | 6,940 | 5,003 | 3,360 | 44,314 | ||||||||||||||||||||||||||||||
(Loss) income before income taxes | (25,426 | ) | (47,982 | ) | 6,124 | (16,256 | ) | (83,540 | ) | (32,865 | ) | (9,862 | ) | 2,279 | 4,467 | (35,981 | ) | |||||||||||||||||||||||
Income tax expense (benefit) | 2,255 | (3,510 | ) | 340 | (2,336 | ) | (3,251 | ) | (3,281 | ) | (1,417 | ) | 624 | 1,488 | (2,586 | ) | ||||||||||||||||||||||||
Net (loss) income | $ | (27,681 | ) | $ | (44,472 | ) | $ | 5,784 | $ | (13,920 | ) | $ | (80,289 | ) | $ | (29,584 | ) | $ | (8,445 | ) | $ | 1,655 | $ | 2,979 | $ | (33,395 | ) | |||||||||||||
Net (loss) income(Euros in thousands) | € | (20,011 | ) | € | (29,410 | ) | € | 3,704 | € | (8,857 | ) | € | (54,574 | ) | € | (21,715 | ) | € | (6,144 | ) | € | 1,227 | € | 2,272 | € | (24,360 | ) | |||||||||||||
Loss ratio, expense ratio and combined ratio for PMI Europe are not meaningful. | ||||||||||||||||||||||||||||||||||||||||
Balance Sheet Components - As of Quarter End | 12/31/2008 | 9/30/2008 | 6/30/2008 | 3/31/2008 | 12/31/2007 | 9/30/2007 | 6/30/2007 | 3/31/2007 | ||||||||||||||||||||||||||||||||
(U.S. dollars in thousands) | (U.S. dollars in thousands) | |||||||||||||||||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||||||||||
Investments: | ||||||||||||||||||||||||||||||||||||||||
Fixed income securities | $ | 136,856 | $ | 145,746 | $ | 220,099 | $ | 222,364 | $ | 200,825 | $ | 203,992 | $ | 197,165 | $ | 198,445 | ||||||||||||||||||||||||
Cash and cash equivalents | 107,420 | 109,440 | 58,256 | 53,765 | 53,335 | 47,715 | 36,316 | 23,662 | ||||||||||||||||||||||||||||||||
Reinsurance recoverables | — | 954 | 1,066 | 1,068 | 987 | 965 | 916 | 904 | ||||||||||||||||||||||||||||||||
Deferred policy acquisition costs | 2,228 | 2,580 | 4,581 | 4,623 | 3,921 | 5,346 | 4,366 | 3,821 | ||||||||||||||||||||||||||||||||
Property, equipment and software, net of accumulated depreciation and amortization | 948 | 1,165 | 1,269 | 1,372 | 1,323 | 1,317 | 1,293 | 1,344 | ||||||||||||||||||||||||||||||||
Other assets | 14,332 | 18,279 | 15,287 | 15,837 | 11,780 | 10,094 | 9,327 | 14,809 | ||||||||||||||||||||||||||||||||
Total assets | $ | 261,784 | $ | 278,164 | $ | 300,558 | $ | 299,029 | $ | 272,171 | $ | 269,429 | $ | 249,383 | $ | 242,985 | ||||||||||||||||||||||||
Liabilities | ||||||||||||||||||||||||||||||||||||||||
Reserve for losses and loss adjustment expenses | $ | 84,503 | $ | 90,715 | $ | 62,620 | $ | 60,692 | $ | 41,579 | $ | 20,634 | $ | 18,083 | $ | 17,587 | ||||||||||||||||||||||||
Unearned premiums | 23,948 | 25,417 | 29,521 | 27,140 | 22,983 | 23,347 | 21,390 | 21,117 | ||||||||||||||||||||||||||||||||
Other liabilities | 76,814 | 61,269 | 47,284 | 50,432 | 45,534 | 36,772 | 24,154 | 26,697 | ||||||||||||||||||||||||||||||||
Total liabilities | 185,265 | 177,401 | 139,425 | 138,264 | 110,096 | 80,753 | 63,627 | 65,401 | ||||||||||||||||||||||||||||||||
Shareholder’s equity | 76,519 | 100,763 | 161,133 | 160,765 | 162,075 | 188,676 | 185,756 | 177,584 | ||||||||||||||||||||||||||||||||
Total liabilities and shareholder’s equity | $ | 261,784 | $ | 278,164 | $ | 300,558 | $ | 299,029 | $ | 272,171 | $ | 269,429 | $ | 249,383 | $ | 242,985 | ||||||||||||||||||||||||
Page 17
THE PMI GROUP, INC. AND SUBSIDIARIES
PMI EUROPE STATISTICAL INFORMATION
2008 | 2007 | |||||||||||||||||||||||||||||
12/31/2008 | 9/30/2008 | 6/30//2008 | 3/31/2008 | Total (15) | 12/31/2007 | 9/30/2007 | 6/30/2007 | 3/31/2007 | Total (15) | |||||||||||||||||||||
(U.S. dollars in millions, except claims paid) | (U.S. dollars in millions, except claims paid) | |||||||||||||||||||||||||||||
New insurance written | $ | 172 | $ | 90 | $ | 129 | $ | 95 | $ | 486 | $ | 236 | $ | 132 | $ | 141 | $ | 136 | $ | 645 | ||||||||||
New credit default swaps written | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 12,067 | $ | 1,919 | $ | — | $ | — | $ | 13,986 | ||||||||||
New reinsurance written | $ | — | $ | — | $ | 3,627 | $ | 1,934 | $ | 5,561 | $ | 617 | $ | 1,402 | $ | 1,778 | $ | 504 | $ | 4,301 | ||||||||||
Insurance in force | $ | 46,290 | $ | 55,143 | $ | 62,422 | $ | 63,103 | $ | 46,290 | $ | 62,929 | $ | 51,707 | $ | 48,120 | $ | 48,121 | $ | 62,929 | ||||||||||
Risk in force | $ | 7,367 | $ | 7,972 | $ | 9,182 | $ | 9,628 | $ | 7,367 | $ | 9,420 | $ | 5,711 | $ | 3,813 | $ | 3,824 | $ | 9,420 | ||||||||||
Claims paid including credit default swaps(in thousands) | $ | 11,988 | $ | 2,461 | $ | 3,593 | $ | 3,562 | $ | 21,604 | $ | 2,898 | $ | 3,207 | $ | 2,577 | $ | 1,547 | $ | 10,229 |
Page 18
THE PMI GROUP, INC. AND SUBSIDIARIES
FINANCIAL GUARANTY SEGMENT(8) RESULTS OF OPERATIONS AND BALANCE SHEETS
2008 | 2007 | |||||||||||||||||||||||||||||||||||||
Income Statement Components - Quarter Ended | 12/31/2008 | 9/30/2008 | 6/30/2008 | 3/31/2008 | Total | 12/31/2007 | 9/30/2007 | 6/30/2007 | 3/31/2007 | Total | ||||||||||||||||||||||||||||
(Dollars in thousands) | (Dollars in thousands) | |||||||||||||||||||||||||||||||||||||
Net premiums written | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||||
Revenues | ||||||||||||||||||||||||||||||||||||||
Premiums earned | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||||
Net investment income | — | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||
Net realized investment gains | — | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||
Impairment of unconsolidated subsidiaries(2) | — | (2,887 | ) | — | (87,981 | ) | (90,868 | ) | (38,499 | ) | — | — | — | (38,499 | ) | |||||||||||||||||||||||
Total (expneses) revenues | — | (2,887 | ) | — | (87,981 | ) | (90,868 | ) | (38,499 | ) | — | — | — | (38,499 | ) | |||||||||||||||||||||||
Losses and expenses | — | |||||||||||||||||||||||||||||||||||||
Losses and loss adjustment expenses | — | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||
Amortization of deferred policy acquisition costs | — | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||
Other underwriting and operating expenses | — | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||
Total losses and expenses | — | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||
Loss before equity in (losses) earnings from unconsolidated subsidiaries and income taxes | — | (2,887 | ) | — | (87,981 | ) | (90,868 | ) | (38,499 | ) | — | — | — | (38,499 | ) | |||||||||||||||||||||||
0 | ||||||||||||||||||||||||||||||||||||||
Equity in (losses) earnings from unconsolidated subsidiaries | (6,453 | ) | 9,340 | (24,321 | ) | (36,236 | ) | (57,670 | ) | (794,637 | ) | (26,741 | ) | 30,842 | 31,703 | (758,833 | ) | |||||||||||||||||||||
(Loss) income from continuing operations before income taxes | (6,453 | ) | 6,453 | (24,321 | ) | (124,217 | ) | (148,538 | ) | (833,136 | ) | (26,741 | ) | 30,842 | 31,703 | (797,332 | ) | |||||||||||||||||||||
Income tax (benefit) expense from continuing operations | (23,296 | ) | — | — | (1,244 | ) | (24,540 | ) | (67,767 | ) | (1,113 | ) | 3,264 | 3,040 | (62,576 | ) | ||||||||||||||||||||||
(Loss) income from continuing operations | $ | 16,843 | $ | 6,453 | $ | (24,321 | ) | $ | (122,973 | ) | $ | (123,998 | ) | $ | (765,369 | ) | $ | (25,628 | ) | $ | 27,578 | $ | 28,663 | $ | (734,756 | ) | ||||||||||||
(Loss) income from discontinued operations, net of taxes | (1,507 | ) | 437 | (21,785 | ) | (1,265 | ) | (24,120 | ) | (787 | ) | 1,236 | 1,436 | 1,201 | 3,086 | |||||||||||||||||||||||
Net (loss) income | $ | 15,336 | $ | 6,890 | $ | (46,106 | ) | $ | (124,238 | ) | $ | (148,118 | ) | $ | (766,156 | ) | $ | (24,392 | ) | $ | 29,014 | $ | 29,864 | $ | (731,670 | ) | ||||||||||||
Balance Sheet Components - As of Quarter End | 12/31/2008 | 9/30/2008 | 6/30/2008 | 3/31/2008 | 12/31/2007 | 9/30/2007 | 6/30/2007 | 3/31/2007 | ||||||||||||||||||||||||||||||
(Dollars in thousands) | (Dollars in thousands) | |||||||||||||||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||||||||
Investments: | ||||||||||||||||||||||||||||||||||||||
Fixed income securities | $ | — | $ | 617 | $ | 117,607 | $ | 163,534 | $ | 167,915 | $ | 167,276 | $ | 165,422 | $ | 133,461 | ||||||||||||||||||||||
Equity securities: preferred | — | — | 20,097 | 21,102 | 22,465 | 26,880 | 25,131 | 24,459 | ||||||||||||||||||||||||||||||
Total investments | $ | — | $ | 617 | $ | 137,704 | $ | 184,636 | $ | 190,380 | $ | 194,156 | $ | 190,553 | $ | 157,920 | ||||||||||||||||||||||
Cash and cash equivalents | — | 30,220 | 29,276 | 7,419 | 11,252 | 11,610 | 15,414 | 56,260 | ||||||||||||||||||||||||||||||
Investments in unconsolidated subsidiaries | — | 6,453 | — | 25,998 | 163,661 | 984,417 | 996,431 | 977,523 | ||||||||||||||||||||||||||||||
Deferred policy acquisition costs | — | — | — | 3,600 | 3,910 | 3,902 | 3,312 | 2,182 | ||||||||||||||||||||||||||||||
Property, equipment and software, net of accumulated depreciation and amortization | — | — | 162 | 174 | 187 | 131 | 132 | 133 | ||||||||||||||||||||||||||||||
Other assets | 70,696 | 60,414 | 67,520 | 7,323 | 52,918 | 3,838 | 4,282 | 5,282 | ||||||||||||||||||||||||||||||
Total assets | $ | 70,696 | $ | 97,704 | $ | 234,662 | $ | 229,150 | $ | 422,308 | $ | 1,198,054 | $ | 1,210,124 | $ | 1,199,300 | ||||||||||||||||||||||
Liabilities | ||||||||||||||||||||||||||||||||||||||
Reserve for losses and loss adjustment expenses | $ | — | $ | 22,900 | $ | 7,241 | $ | (878 | ) | $ | 2,650 | $ | — | $ | — | $ | — | |||||||||||||||||||||
Unearned premiums | — | — | 820 | 6,331 | 6,709 | 6,748 | 6,984 | 6,123 | ||||||||||||||||||||||||||||||
Long-term debt | — | — | 50,000 | 50,000 | 50,000 | 50,000 | 50,000 | 50,000 | ||||||||||||||||||||||||||||||
Other (assets) liabilities | — | (2,000 | ) | 2,897 | (45,082 | ) | 2,892 | 37,766 | 40,817 | 45,745 | ||||||||||||||||||||||||||||
Total liabilities | — | 20,900 | 60,958 | 10,371 | 62,251 | 94,514 | 97,801 | 101,868 | ||||||||||||||||||||||||||||||
Shareholder’s equity | 70,696 | 76,804 | 173,704 | 218,779 | 360,057 | 1,103,540 | 1,112,323 | 1,097,432 | ||||||||||||||||||||||||||||||
Total liabilities and shareholder’s equity | $ | 70,696 | $ | 97,704 | $ | 234,662 | $ | 229,150 | $ | 422,308 | $ | 1,198,054 | $ | 1,210,124 | $ | 1,199,300 | ||||||||||||||||||||||
Page 19
THE PMI GROUP, INC. AND SUBSIDIARIES
CORPORATE AND OTHER SEGMENT(9) RESULTS OF OPERATIONS AND BALANCE SHEETS
2008 | 2007 | |||||||||||||||||||||||||||||||||||||||
Income Statement Components - Quarter Ended | 12/31/2008 | 9/30/2008 | 6/30/2008 | 3/31/2008 | Total | 12/31/2007 | 9/30/2007 | 6/30/2007 | 3/31/2007 | Total | ||||||||||||||||||||||||||||||
(Dollars in thousands) | (Dollars in thousands) | |||||||||||||||||||||||||||||||||||||||
Net premiums written | $ | 10 | $ | 12 | $ | 5 | $ | 8 | $ | 35 | $ | 19 | $ | 14 | $ | 7 | $ | 12 | $ | 52 | ||||||||||||||||||||
Revenues | ||||||||||||||||||||||||||||||||||||||||
Premiums earned | $ | 11 | $ | 10 | $ | 11 | $ | 12 | $ | 44 | $ | 10 | $ | 18 | $ | 16 | $ | 13 | $ | 57 | ||||||||||||||||||||
Net investment income | 2,410 | 3,136 | 2,757 | 1,942 | 10,245 | 2,131 | 2,666 | 2,989 | 3,563 | 11,349 | ||||||||||||||||||||||||||||||
Net realized investment (losses) gains | (1 | ) | (988 | ) | (3 | ) | (11 | ) | (1,003 | ) | 12,669 | (1,886 | ) | (620 | ) | (726 | ) | 9,437 | ||||||||||||||||||||||
Change in fair value of certain debt instruments(1) | 11,647 | 66,283 | 16,957 | 28,708 | 123,595 | — | — | — | — | — | ||||||||||||||||||||||||||||||
Other income | 1,739 | 2,186 | 3,319 | 3,243 | 10,487 | 3,270 | 4,563 | 4,769 | 1,706 | 14,308 | ||||||||||||||||||||||||||||||
Total revenues | 15,806 | 70,627 | 23,041 | 33,894 | 143,368 | 18,080 | 5,361 | 7,154 | 4,556 | 35,151 | ||||||||||||||||||||||||||||||
Losses and expenses | ||||||||||||||||||||||||||||||||||||||||
Losses and loss adjustment expenses | — | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||
Other underwriting and operating (income) expenses | (5,847 | ) | 21,731 | 21,145 | 18,283 | 55,312 | 18,400 | 16,918 | 19,925 | 24,013 | 79,256 | |||||||||||||||||||||||||||||
Interest expense | 11,284 | 11,370 | 9,883 | 8,331 | 40,868 | 8,350 | 8,322 | 8,358 | 8,253 | 33,283 | ||||||||||||||||||||||||||||||
Total losses and expenses | 5,437 | 33,101 | 31,028 | 26,614 | 96,180 | 26,750 | 25,240 | 28,283 | 32,266 | 112,539 | ||||||||||||||||||||||||||||||
Income (loss) before equity in (losses) earnings from unconsolidated subsidiaries and income taxes | 10,369 | 37,526 | (7,987 | ) | 7,280 | 47,188 | (8,670 | ) | (19,879 | ) | (21,129 | ) | (27,710 | ) | (77,388 | ) | ||||||||||||||||||||||||
Equity in (losses) earnings from unconsolidated subsidiaries | (194 | ) | (152 | ) | (121 | ) | (121 | ) | (588 | ) | 8 | (28 | ) | 289 | (55 | ) | 214 | |||||||||||||||||||||||
Income (loss) before income taxes | 10,175 | 37,374 | (8,108 | ) | 7,159 | 46,600 | (8,662 | ) | (19,907 | ) | (20,840 | ) | (27,765 | ) | (77,174 | ) | ||||||||||||||||||||||||
Income tax expense (benefit) | 3,697 | 10,012 | (2,684 | ) | 2,184 | 13,209 | (6,528 | ) | (8,869 | ) | (6,015 | ) | (7,932 | ) | (29,344 | ) | ||||||||||||||||||||||||
Net income (loss) | $ | 6,478 | $ | 27,362 | $ | (5,424 | ) | $ | 4,975 | $ | 33,391 | $ | (2,134 | ) | $ | (11,038 | ) | $ | (14,825 | ) | $ | (19,833 | ) | $ | (47,830 | ) | ||||||||||||||
Balance Sheet Components - As of Quarter End | 12/31/2008 | 9/30/2008 | 6/30/2008 | 3/31/2008 | 12/31/2007 | 9/30/2007 | 6/30/2007 | 3/31/2007 | ||||||||||||||||||||||||||||||||
(Dollars in thousands) | (Dollars in thousands) | |||||||||||||||||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||||||||||
Investments: | ||||||||||||||||||||||||||||||||||||||||
Fixed income securities | $ | 135,230 | $ | 134,222 | $ | 50,080 | $ | 51,979 | $ | 52,974 | $ | 53,088 | $ | 53,120 | $ | 53,849 | ||||||||||||||||||||||||
Equity securities: common | — | — | 987 | 1,242 | 1,242 | 1,275 | 3,477 | 4,250 | ||||||||||||||||||||||||||||||||
Short term investments | 1,300 | 1,300 | 1,300 | 1,300 | 1,300 | 1,301 | 1,300 | 1,300 | ||||||||||||||||||||||||||||||||
Total investments | $ | 136,530 | $ | 135,522 | $ | 52,367 | $ | 54,521 | $ | 55,516 | $ | 55,664 | $ | 57,897 | $ | 59,399 | ||||||||||||||||||||||||
Cash and cash equivalents | 119,305 | 118,659 | 224,779 | 40,214 | 51,512 | 45,335 | 163,700 | 100,574 | ||||||||||||||||||||||||||||||||
Investments in unconsolidated subsidiaries | 15,295 | 15,360 | 15,646 | 15,493 | 14,914 | 15,158 | 15,224 | 15,200 | ||||||||||||||||||||||||||||||||
Property, equipment and software, net of accumulated depreciation and amortization | 76,033 | 77,136 | 78,042 | 78,627 | 79,142 | 79,594 | 80,807 | 81,867 | ||||||||||||||||||||||||||||||||
Other (liabilities) assets | (26,852 | ) | (17,281 | ) | (5,837 | ) | 8,821 | 49,657 | 39,901 | 42,165 | 14,222 | |||||||||||||||||||||||||||||
Total assets | $ | 320,311 | $ | 329,396 | $ | 364,997 | $ | 197,676 | $ | 250,741 | $ | 235,652 | $ | 359,793 | $ | 271,262 | ||||||||||||||||||||||||
Liabilities | ||||||||||||||||||||||||||||||||||||||||
Unearned premiums | $ | 20 | $ | 21 | $ | 18 | $ | 26 | $ | 29 | $ | 21 | $ | 25 | $ | 33 | ||||||||||||||||||||||||
Debt | 481,764 | 532,177 | 554,694 | 364,378 | 446,593 | 446,593 | 446,593 | 446,593 | ||||||||||||||||||||||||||||||||
Other (assets) liabilities | (25,316 | ) | (10,820 | ) | (7,122 | ) | 7,893 | (515 | ) | (16,256 | ) | (2,423 | ) | (76,061 | ) | |||||||||||||||||||||||||
Total liabilities | 456,468 | 521,378 | 547,590 | 372,297 | 446,107 | 430,358 | 444,195 | 370,565 | ||||||||||||||||||||||||||||||||
Shareholder’s deficit | (136,157 | ) | (191,982 | ) | (182,593 | ) | (174,621 | ) | (195,366 | ) | (194,706 | ) | (84,402 | ) | (99,303 | ) | ||||||||||||||||||||||||
Total liabilities and shareholder’s deficit | $ | 320,311 | $ | 329,396 | $ | 364,997 | $ | 197,676 | $ | 250,741 | $ | 235,652 | $ | 359,793 | $ | 271,262 | ||||||||||||||||||||||||
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