MIs Are Strengthened by New Capital Rules: MGIC CEO

Print

Email

Reprints

Comment

Twitter

LinkedIn

Facebook

Google+

The future of MGIC Investment Corp. and the private mortgage insurance industry as a whole will be strengthened with the proposed capital standards, even though the company has filed a comment letter looking for changes.

The proposed capital rules solidify the capital base of the private mortgage insurance industry, plus they give the MIs “a place at the table” when it comes to discussing such issues as risk-sharing arrangements with the Federal Housing Administration and an expansion of what the government-sponsored enterprises will allow them to insure, said Curt Culver, the soon-to-be retiring chairman and CEO of MGIC, during a presentation at the Barclays 2014 Global Financial Services Conference.

However, there is a $16 billion market available for the MIs to insure if they were allowed to write business for borrowers with credit scores between 660 and 750, an area they had historically been able to serve. It is good business that could be done successfully, Culver said MGIC noted in its comment letter on the capital standards.

“Once the capital rule is finalized there will be more support for expanding our opportunity” in Congressional GSE reform proposals, which he added have been positive for the MI industry to begin with.

MGIC is generally supportive of the capital rules but took issues with certain risk requirements in the initial proposal. It expects the Federal Housing Finance Agency to see things its way when it comes to modifying the rules. “We have the angels on our side relative to the arguments,” said Culver, who will remain as nonexecutive chairman at MGIC after March 2015.

Meanwhile the new master policy regulators required the industry to adopt eliminates any dispute with mortgage investors over what is covered or not covered by private mortgage insurance and that is important for the return of a private mortgage-backed securities market, he said.

Article source: http://www.nationalmortgagenews.com/news/risk-management/mis-are-strengthened-by-new-capital-rules-mgic-ceo-1042577-1.html

Leave a Reply

WP2Social Auto Publish Powered By : XYZScripts.com
Bunk Beds