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                                                                    EXHIBIT 11.1

                      THE PMI GROUP, INC. AND SUBSIDIARIES

                       COMPUTATION OF NET INCOME PER SHARE




                                                    THREE MONTHS ENDED        NINE MONTHS ENDED
                                                       SEPTEMBER 30,            SEPTEMBER 30,
(In thousands, except per share data)                 1996        1995        1996         1995
                                                    -------     -------     --------     --------
                                                                              
PRIMARY NET INCOME PER SHARE

Adjusted shares outstanding:
     Average common shares outstanding               35,011      35,000       35,011       35,000
     Net shares to be issued upon exercise of
          dilutive stock options after applying
          treasury stock method                          89          93           90           75
                                                    -------     -------     --------     --------
     Average shares outstanding                      35,100      35,093       35,101       35,075
                                                    =======     =======     ========     ========
Net income                                          $41,280     $35,115     $119,490     $101,391
                                                    =======     =======     ========     ========
Primary net income per share                        $  1.18     $  1.00     $   3.40     $   2.89
                                                    =======     =======     ========     ========

FULLY DILUTED NET INCOME PER SHARE

Adjusted shares outstanding:
     Average common shares outstanding               35,011      35,000       35,011       35,000
     Net shares to be issued upon exercise of
          dilutive stock options after applying
          treasury stock method                         117          93          117           92
                                                    -------     -------     --------     --------
     Average shares outstanding                      35,128      35,093       35,128       35,092
                                                    =======     =======     ========     ========
Net income                                          $41,280     $35,115     $119,490     $101,391
                                                    =======     =======     ========     ========
Fully diluted net income per share                  $  1.18     $  1.00     $   3.40     $   2.89
                                                    =======     =======     ========     ========