Mortgage Insurer MGIC Plans Share Offering
NEW YORK (Reuters) - MGIC Investment Corp (MTG.N), the largest U.S. mortgage insurer, said on Monday it plans to sell shares to help increase capital at its main subsidiary Mortgage Guaranty Insurance Co.
The Milwaukee-based company said it had not decided on the size of the planned offering, but planned to make that decision by mid-to-late-March.
The funds from the share offering would help it expand the volume of new insurance business, it said, adding the funds would be used for general corporate purposes.
The mortgage insurer, which posted a $1.47 billion loss in the fourth-quarter as more U.S. homeowners fell behind on payments, said it may make other capital raising moves in addition to the share offering.
Like many insurers, MGIC has been battered as borrowers missed more payments and investors stopped buying a wide variety of debt perceived to carry too much credit risk.
The insurer said it hired an outside adviser last month to help it raise capital. MGIC executives have said that the company would likely raise less than $1.5 billion in fresh capital and that it did not need the funds immediately.
(Reporting by Chris Reiter; editing by Carol Bishopric, Leslie Gevirtz)
