United Guaranty's 1Q Income Up 12% Even as NIW Falls 16%

The first-quarter pretax operating income at American International Group's United Guaranty mortgage insurance subsidiary increased 12% from the same quarter in 2015, even as new insurance written declined by 16%.

United Guaranty had pretax operating income of $163 million, up from $145 million for last year's first quarter, benefiting from lower mortgage delinquency rates and higher cure rates on previously defaulted mortgages.

The company remains the leading underwriter of new private mortgage insurance policies at $8.8 billion, down from $10.5 billion one year prior. Activity in the first quarter of 2015 benefited from high amounts of refinance volume.

Mortgage Guaranty Insurance Corp. ended the first quarter with NIW of $8.3 billion, followed by Radian Guaranty with $8.1 billion.

AIG lost $183 million in the first quarter, compared with net income of $2.5 billion for the first quarter of 2015, due to market volatility affecting its investment portfolio, the company said in a press release after the market closed on Monday afternoon.

During the first quarter, AIG announced it would sell 19.9% of UG in an initial public offering.

Separately, on April 28, Genworth Financial said its U.S. mortgage insurance business had net operating income of $61 million, up from $52 million in the first quarter of 2015.

Its NIW increased 17% year-over-year to $7.4 billion from $6.3 billion, benefiting from an increase in purchase mortgage business.

Genworth Financial, which during the first quarter announced plans to restructure its life insurance business, had net income of $53 million, down from net income of $154 million in the first quarter of 2015.