CMG MI Responds to Arizona Action and Confirms Continuing Commitment to Credit Unions

Posted: 2011-08-20 00:00:00

SAN FRANCISCO – Aug. 19, 2011 – CMG Mortgage Insurance Company (CMG MI) confirmed today that recent action by Arizona’s Department of Insurance placing PMI Mortgage Insurance Co. (MIC) under supervision will not impact CMG MI’s new business originations or servicing of existing policies.  There will be no interruption in daily operations, with CMG MI continuing to write business in all 50 states. 

“In addition to the company’s solid operating performance and strong financial footing, CMG MI continues to enjoy the strong support of its joint venture partner CUNA Mutual Group” said CUNA Mutual Group Vice President Sean Dilweg.  Dilweg went on to say “CMG MI will continue to benefit tremendously from CUNA Mutual’s management and financial strength as well as PMI’s ongoing operational services.”

Dilweg also emphasized, “As a stand-alone, incorporated entity with its own capital, and dedicated staffing from its shareholders, CMG MI is strong and committed to the credit unions it serves”

The following are key factors supporting CMG MI’s solid financial position:

·        CUNA Mutual Group’s statutory capital grew to $1.45 billion through June 2011, up $30 million from year-end 2010. The company holds an “A” (Excellent) A.M. Best financial strength rating with a Stable Outlook.

As of June 30, 2011, CMG MI had among the industry’s strongest financial and operating ratios.

• As a separate legal entity, CMG MI’s investment grade ratings – BBB from Standard & Poor’s (S&P) and BBB from Fitch Ratings (Fitch) – are based primarily on CMG MI’s own capital, operations performance and loss mitigation, independent of our shareholders.Our rating with Fitch was affirmed in July of this year, and S&P’s has been stable since February 2010.
• CMG MI has the industry’s lowest portfolio delinquency ratio at 5.3% as of June 30, 2011, an improvement from 5.6% on March 31, 2011.  This figure compares to industry average in the 16% range.
• As of June 30, 2011, CMG MI enjoyed a strong liquidity position with claims-paying resources, backed by cash and readily marketable securities of $328 million.
•   This liquidity compares favorably to the company’s $171 million in loss reserves for claims as of the end of second quarter 2011.
• >The 2-to-1 ratio of liquidity to reserves is one of the highest in the mortgage insurance industry.CMG MI’s delinquency inventory improved in the second quarter 2011, resulting in a favorable release of more than $8 million in previously established loss reserves.

ABOUT CMG MI

Licensed in all states, CMG Mortgage Insurance Company (CMG MI) operates as a corporate joint venture between CUNA Mutual Insurance Society and PMI Mortgage Insurance Co.  The company provides private mortgage guaranty insurance to protect credit unions against potential losses in the event of borrower default.   By covering default risk on residential first mortgage loans, CMG MI facilitates the sale of low-down-payment mortgages in the secondary mortgage market and expands homeownership opportunities by enabling credit union members to buy a home with a down payment of less than 20 percent.  For more information, visit www.cmgmi.com.

Statements in this document that are not historical facts, or that relate to future plans, events or performance, are “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include our discussion of the environment for mortgage insurance and our risk management practices. Readers are cautioned that forward-looking statements by their nature involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. Many factors could cause actual results and developments to differ materially from those expressed or implied by forward-looking statements including, among others, conditions affecting the mortgage insurance industry, general economic conditions, and regulatory and legislative developments. Except as may be required by law, we undertake no obligation to update forward-looking statements.

CONTACT:

Joel Luebkeman

Corporate Communications

CMG Mortgage Insurance Company

22 Fourth Street, Floor 13

San Francisco, CA  94103

Phone:  (415) 284.2508

Fax:  (800) 490.6757

joel.luebkeman@cmgmi.com – www.cmgmi.com