Arch Capital Group Ltd. Announces Closing of Acquisition of CMG MI and PMI’s Operating Platform
30 Janvier 2014 - 10:01PM
Business Wire
Arch Capital Group Ltd. (NASDAQ:ACGL) today announced that its
U.S.-based subsidiaries (Arch U.S. MI) have completed the
acquisition of CMG Mortgage Insurance Company (CMG MI) and the
mortgage insurance operating platform of PMI Mortgage Insurance Co.
(PMI). As part of the transaction, CMG MI, which will be renamed
“Arch Mortgage Insurance Company,” has obtained approval as an
eligible mortgage insurer from Fannie Mae and Freddie Mac, subject
to maintaining certain ongoing requirements.
The completion of the transaction enables Arch U.S. MI to enter
the U.S. mortgage insurance marketplace immediately and allows the
Company to serve all lenders nationwide, including CMG MI’s
existing credit union customers. The acquisition provides Arch U.S.
MI with mortgage insurance licenses across the United States and a
comprehensive mortgage insurance operating platform. In addition,
Arch U.S. MI entered into a distribution agreement with CMFG Life
Insurance Company (CUNA Mutual) and a reinsurance agreement with an
affiliate of CUNA Mutual. These arrangements with CUNA Mutual will
provide CMG MI’s existing customer base with a seamless transition
and also will enable Arch U.S. MI to gain immediate access to the
credit union marketplace.
The acquisition broadens ACGL’s existing global mortgage
insurance and reinsurance capabilities. Arch U.S. MI will
complement ACGL’s existing European Union-based mortgage insurance
and global reinsurance operations. In addition to traditional
mortgage insurance, affiliates of ACGL provide various risk sharing
products to mortgage lenders as well as Fannie Mae and Freddie
Mac.
Marc Grandisson, Chairman and CEO of Arch Worldwide Reinsurance
Group, is responsible for ACGL’s global mortgage insurance and
reinsurance operations. Arch U.S. MI is led by President and CEO
David Gansberg. Mr. Gansberg joined the Arch group in 2001 and has
20 years of experience in various actuarial, underwriting and
senior management positions in the insurance industry. Mr. Gansberg
will report to Andrew Rippert, who joined Arch in 2010 and has 16
years of experience in the mortgage insurance industry. Mr. Rippert
will be CEO of Arch Worldwide Mortgage Insurance and Reinsurance
Group and currently serves as President and CEO of Arch Mortgage
Insurance Limited based in Ireland. The current experienced senior
management team and staff of PMI and CMG MI also joined Arch U.S.
MI in connection with the transaction. The CMG MI sales team will
remain CUNA Mutual employees dedicated to serving their credit
union customers.
Constantine (Dinos) Iordanou, Chairman and CEO of ACGL,
commented, “We are extremely pleased to complete this transaction
and expand our existing mortgage insurance and reinsurance
capabilities, which will enable our company to provide a strong and
diversified source of private capital to the U.S. mortgage
insurance market. We are gratified that Arch U.S. MI will be led by
experienced managers in David and Andrew and also welcome our new
colleagues from PMI and CMG MI. We believe the impressive
operational, managerial and risk management expertise of Arch,
together with the mortgage insurance professionals we have
assembled, will form an industry leading team with broad
capabilities to meet our clients’ needs. Our ability to promote
from within is another indication of the depth and strength of the
management team we have built at Arch. As we develop our new
business, we look forward to working with Fannie Mae and Freddie
Mac.”
Marc Grandisson added, “All of us at Arch thank Fannie Mae,
Freddie Mac, the FHFA and the Wisconsin and Arizona Departments of
Insurance for their approval of this acquisition, as well as their
support of our Company. We are open for business and look forward
to strengthening relationships with our existing credit union
customers, as well as broadening our relationships with lenders
nationwide.”
“We welcome Arch as our newest approved provider of mortgage
insurance coverage on loans delivered to Fannie Mae, through their
acquisition of the CMG Mortgage Insurance Company, which has been a
Fannie Mae approved mortgage insurer since 1994,” said Rob
Schaefer, Vice President for Credit Enhancing Strategy and
Management. “Arch’s acquisition of CMG provides additional
financial support for CMG’s existing mortgage insurance obligations
with Fannie Mae and other policyholders, and also represents
another step on the road to attracting private capital to the
mortgage credit space.”
“Freddie Mac is pleased to approve Arch Mortgage Insurance
Company as an eligible mortgage insurer,” said Gina Healy, Vice
President of Mortgage Insurance and Special Asset Workouts at
Freddie Mac. “Arch Capital Group brings additional private capital
to support homeownership opportunities and to help further the
nation’s housing recovery.”
About Arch Capital Group Ltd.
Arch Capital Group Ltd., a Bermuda-based company with
approximately $6.34 billion in capital at September 30, 2013, after
giving effect to a $500 million notes offering in the 2013 fourth
quarter, provides insurance and reinsurance on a worldwide basis
through its wholly owned subsidiaries.
Cautionary Note Regarding Forward-Looking Statements
The Private Securities Litigation Reform Act of 1995 provides a
"safe harbor" for forward−looking statements. This release or any
other written or oral statements made by or on behalf of Arch
Capital Group Ltd. and its subsidiaries may include forward−looking
statements, which reflect our current views with respect to future
events and financial performance. All statements other than
statements of historical fact included in or incorporated by
reference in this release are forward−looking statements.
Forward−looking statements can generally be identified by the
use of forward−looking terminology such as "may," "will," "expect,"
"intend," "estimate," "anticipate," "believe" or "continue" or
their negative or variations or similar terminology.
Forward−looking statements involve our current assessment of risks
and uncertainties. Actual events and results may differ materially
from those expressed or implied in these statements. A
non-exclusive list of the important factors that could cause actual
results to differ materially from those in such forward-looking
statements includes the following: adverse general economic and
market conditions; increased competition; pricing and policy term
trends; fluctuations in the actions of rating agencies and our
ability to maintain and improve our ratings; investment
performance; the loss of key personnel; the adequacy of our loss
reserves, severity and/or frequency of losses, greater than
expected loss ratios and adverse development on claim and/or claim
expense liabilities; greater frequency or severity of unpredictable
natural and man-made catastrophic events; the impact of acts
of terrorism and acts of war; changes in regulations and/or tax
laws in the United States or elsewhere; our ability to successfully
integrate, establish and maintain operating procedures as well as
integrate the businesses we have acquired or may acquire into the
existing operations; changes in accounting principles or policies;
material differences between actual and expected assessments for
guaranty funds and mandatory pooling arrangements; availability and
cost to us of reinsurance to manage our gross and net exposures;
the failure of others to meet their obligations to us; and other
factors identified in our filings with the U.S. Securities and
Exchange Commission.
The foregoing review of important factors should not be
construed as exhaustive and should be read in conjunction with
other cautionary statements that are included herein or elsewhere.
All subsequent written and oral forward−looking statements
attributable to us or persons acting on our behalf are expressly
qualified in their entirety by these cautionary statements. We
undertake no obligation to publicly update or revise any
forward−looking statement, whether as a result of new information,
future events or otherwise.
Arch Capital Group Ltd.Mark D. Lyons, 441-278-9250
Arch Capital (NASDAQ:ACGL)
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