UPDATE 1-First American reports lower Q1 profit

Thu Apr 29, 2010 11:51am EDT

* Q1 EPS $0.28 vs $0.38

* Q1 rev down 1 pct to $1.36 bln

April 29 (Reuters) - First American Corp (FAF.N), the No.1 U.S. title insurer by revenue, reported a lower quarterly profit as more premiums were retained by agents.

The Santa Ana, California-based First American earned $29.5 million, or 28 cents a share, compared with $36 million, or 38 cents a share a year ago.

The company, which posted a one percent decline in quarterly revenue at $1.36 billion, said the spin-off of its Information Solutions Group, rebranded CoreLogic Inc, remains on track and is likely to close on June 1.

First American closed 286,600 orders during the quarter, while it opened 389,100.

However, agents retained $302.5 million of premiums, while they retained $239.6 million a year ago.

Title insurance guarantees that property owners have title to their property and can legally transfer it. Many lenders require buyers to have the insurance before extending loans, and the industry has to depend on total mortgage-origination volumes.

Smaller rival Stewart Information posted a narrower first-quarter loss of $29 million, or $1.59 a share, compared with a loss of $37.6 million, or $2.07 a share a year ago. [ID:nSGE63S0H9]

First American's and Stewart's results come a week after the No.2 player Fidelity National Financial Inc's (FNF.N) quarterly results showed strength in open orders, pointing to recovering mortgage-origination volumes.

Shares of First American were down 3 percent at $35.65 in morning trade Thursday on the New York Stock Exchange. (Reporting by Brenton Cordeiro and Anurag Kotoky in Bangalore; Editing by Don Sebastian)