Genworth Financial (GNW) agreed to sell a European mortgage insurance operation to AmTrust Financial Services as CEO Tom McInerney divests assets to boost capital amid tighter regulation on mortgage insurers in the U.S., an article in Bloomberg reported.
Genworth expects to record an after-tax loss of $140 million tied to the sale and will get net proceeds of about $55 million.
U.S. home-loan guarantors have been raising capital to prepare for private mortgage insurance eligibility requirements announced last year by the Federal Housing Finance Agency.
Back in April, Radian Guaranty, the mortgage insurance subsidiary of Radian Group (RDN), announced the sale of Radian Asset Assurance Inc., Radian's financial guaranty insurance subsidiary, to Assured Guaranty Corp., a subsidiary of Assured Guaranty (AGO).
“The sale of our financial guaranty subsidiary marks an important milestone for Radian as we simplify our focus on our core strengths and position our company for future top-line growth,” Radian CEO S.A Ibrahim said. “The successful completion of the sale will also help to accelerate our ability to comply with the final PMIERs."
