Slide 1: The PMI Group, Inc. May 2008
The PMI Group, Inc. May 2008 Exhibit 99.1
Slide 2: Forward-Looking Statement
Forward-Looking Statement FORWARD-LOOKING STATEMENTS: Statements in this presentation and oral statements made at this conference 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 Litigat
Slide 3: The PMI Group, Inc.
The PMI Group, Inc. For over 35 years PMI has combined its risk management expertise and financial strength to serve the evolving needs of the financial markets. PMI provides insurance, guarantees and reinsurance for residential mortgages and securities, public finance obligations and asset-backed s
Slide 4: PMI's Five Point Plan for Progress
PMI’s Five Point Plan for Progress Implemented significant changes to underwriting guidelines principally related to 100% LTVs, Alt-As and distressed markets Resulting business will be better credit quality Book High Quality New Business Mitigate losses through claim verification, foreclosure preven
Slide 5: PMI's Global Footprint
PMI’s Global Footprint U.S. Mortgage Insurance Primary IIF $1 24 B Pool RIF $ 3 B Australia + New Zealand $183 billion IIF Europe $63 billion IIF RAM Re 24% ownership Asia $3 billion IIF FGIC 42% ownership CMG $20 billion IIF PMI Canada PMI Guaranty As of March 31, 2008
Slide 6: Segment Net Income
Segment Net Income Net Income by Business Segment* (dollars in millions) The PMI Group’s three business segments: U.S. Mortgage Insurance Operations is a core business with opportunities for growth. International Mortgage Insurance Operations remains a positive contributor to consolidated net income
Slide 7: U.S. Mortgage Insurance
U.S. Mortgage Insurance U.S. Mortgage Insurance Net Income U.S. Mortgage Insurance Total Revenues Core business is experiencing challenges: We have taken steps to successfully navigate this cycle. Expect challenges to continue this year and, as a result, we will have losses on a consolidated basis i
Slide 8: U.S. Mortgage Insurance Operations key metrics
Primary Insurance in Force (dollars in billions) Premiums Earned (dollars in millions) U.S. Mortgage Insurance Operations Expense Ratio Primary Persistency Rate U.S. Mortgage Insurance Q1 2008 $102.6 $123.6 $124.3 Q1 2008 $688.0 $801.0 $207.8 Q1 2008 23.2% 22.5% *13.0% 77.6% 56.2% 44.6% 60.9% 61.9%
Slide 9: Credit Environment
Credit Environment Economy National economy trending toward modest recession Modest rise in unemployment Interest rates continue to move downward Geographic Diversification Portfolio is well diversified throughout the U.S. Florida accounts for 10.8% of risk in force California accounts for 8.4% of r
Slide 10: | mpm
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Slide 11: U.S. Portfolio – Policy Year Loan Performance
U.S. Portfolio – Policy Year Loan Performance Percentage of Cumulative Primary Insurance Losses Paid (Gross) To Cumulative Primary Insurance Premiums Written (Gross)* *Gross premiums written include ceded and refunded premiums. 1982 “Oil Patch” experience 1990 “California” experience Years Since Pol
Slide 12: U.S. Portfolio – Credit Reserves for Losses and LAE and Notices of Default
U.S. Portfolio – Credit Reserves for Losses and LAE and Notices of Default Total Claims Paid Including LAE $72.8 $75.7 $95.9 $117.9 Q1 2007 Q2 2007 Q3 2007 Q4 2007 Q1 2008 Significant strengthened reserves for losses and loss adjustment expenses (LAE). Intense focus on foreclosure prevention through
Slide 13: Expected Benefit from Captive Reinsurance Agreements
Expected Benefit from Captive Reinsurance Agreements PMI’s Captive Reinsurance Agreements Flow Risk in Force Covered by Captives $275 $275 $34 Captive reinsurers are wholly-owned, bankruptcy remote subsidiaries of originators that provide mezzanine level reinsurance for loans for which PMI has provi
Slide 14: International Mortgage Insurance
International Mortgage Insurance International MI Operations Net Income (dollars in millions) Q1 2008 $103.5 International MI operations have consistently been a positive net income contributor. PMI Europe has posted net losses in recent quarters as a result of increased losses and mark-to-market on
Slide 15: International Mortgage Insurance: Australia, Europe, Asia, Canada
International Mortgage Insurance Australia Europe Asia Canada Strong growth in written premiums and net income Losses are trending towards more normal levels Continued strong economic growth and employment Position business to lead in flow and structured segments Stronger relationships with Top 4 le
Slide 16: Financial Guaranty
Financial Guaranty Financial Guaranty Investments Carrying Value* Financial Guaranty Segment Net Income Financial Guaranty segment is no longer strategic to our operations. FGIC carrying value was reduced to zero at March 31, 2008, therefore, the Company will not recognize in future periods its prop
Slide 17: Summary
Summary We are executing our plan to return to profitability and are making substantial progress. Continue to see strong fundamentals in the mortgage insurance business. We continue to believe that our core mortgage insurance operations will be an attractive long-term business. PMI’s entire manageme
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