Genworth profit boosted by lower U.S. mortgage insurance loss
(Reuters) - Life and mortgage insurer Genworth Financial Inc (GNW.N) reported its eighth straight quarterly profit as losses narrowed in its U.S. mortgage insurance business due to a recovering housing market.
The U.S. mortgage insurance business reported a loss of $3 million in the third quarter, much smaller than its loss of $37 million a year earlier.
Genworth, which was spun off from industrial conglomerate General Electric Co (GE.N) nine years ago, said it expects a marginal net loss in the fourth quarter in the U.S. mortgage insurance business due to seasonality.
Mortgage insurers such as Genworth, Radian Group Inc (RDN.N) and MGIC Investment Corp (MTG.N) struggled to recoup losses after the housing bubble burst and foreclosures soared, leaving them with large claims on unpaid home loans.
However, the companies that survived the crunch have benefited in more recent times from a recovering U.S. housing market as low mortgage rates prompt more Americans to buy homes.
Genworth's net profit jumped to $108 million, or 22 cents per share, in the third quarter ended September 30, from $35 million, or 7 cents per share, a year earlier.
Total revenue, however, fell about 6 percent to $2.32 million as both premium and investment income dipped.
On an operating basis, Genworth earned 24 cents per share, which was a cent below analysts' estimates, according to Thomson Reuters I/B/E/S.
Mortgage insurers cover losses when homeowners default and foreclosures fail to recoup costs. Typically, coverage is required when homeowners make a down payment of less than 20 percent on a property.
MGIC reported its second straight quarterly profit earlier this month.
Shares of Genworth, which has a market value of more than $7 billion, were down about 2 percent after the bell. They closed at $14.57 on the New York Stock Exchange on Tuesday.
(Reporting by Avik Das in Bangalore; Editing by Don Sebastian, Maju Samuel)