October 30, 2012 / 8:37 PM / in 5 years

Genworth's U.S. mortgage insurance losses narrow

(Reuters) - Life and mortgage insurer Genworth Financial Inc (GNW.N) posted a third-quarter profit, compared with a loss a year earlier, as losses narrowed at its U.S. mortgage insurance unit.

Mortgage insurers have been struggling to recoup their losses after the housing bubble burst and foreclosures soared, leaving them with large claims on unpaid home loans.

However, the U.S. housing market has been showing signs of recovery. New single-family home sales in the United States surged to their highest levels in more than two years in September.

Net operating loss at Genworth’s U.S. mortgage insurance unit more than halved to $38 million. New flow delinquencies -- a measure of how many new loans were in default -- fell 19 percent.

Net income for the quarter ended September 30 was $34 million, or 7 cents per share, compared with a loss of $16 million, or 3 cents per share, a year earlier.

The insurer reported an operating profit of $121 million, or 25 cents a share.

Analysts on average expected the company to earn 20 cents a share, excluding items, according to Thomson Reuters I/B/E/S.

Genworth, which was spun off from industrial conglomerate General Electric (GE.N), also said its life insurance companies were seeking to complete a second block transaction in the fourth quarter.

    The transaction is expected to generate $100 million in after-tax capital benefits.

    The company in February completed its first block transaction -- in which an insurer sells a chunk of business to a reinsurer in exchange for cash.

    Genworth’s shares have lost almost 20 percent of their value since the beginning of the year, underperforming the broader KBW Insurance Index .KIX, which has gained more than 12 percent in the same period.

    The company’s shares closed at $5.48 on Friday on the New York Stock Exchange.

    Reporting by Jochelle Mendonca and Sharanya Hrishikesh in Bangalore; Editing by Maju Samuel

    0 : 0
    • narrow-browser-and-phone
    • medium-browser-and-portrait-tablet
    • landscape-tablet
    • medium-wide-browser
    • wide-browser-and-larger
    • medium-browser-and-landscape-tablet
    • medium-wide-browser-and-larger
    • above-phone
    • portrait-tablet-and-above
    • above-portrait-tablet
    • landscape-tablet-and-above
    • landscape-tablet-and-medium-wide-browser
    • portrait-tablet-and-below
    • landscape-tablet-and-below