Genworth Implements Mortgage Capital Insurance Plan

""Genworth Financial"":https://www.genworth.com/ got the go-ahead to implement its comprehensive capital plan for its mortgage insurance business. The plan has been fully implemented as of April 1, Virginia-based Genworth announced.

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The company first revealed its ""capital plan"":http://www.dsnews.com/articles/genworth-announces-capital-plan-for-mortgage-business-2013-01-16 in January. The plan is expected to reduce Genworth Mortgage Insurance Company's (GMICO) risk-to-capital ratio by about 15 points and lower the combined risk-to-capital ratio of the U.S. mortgage insurance subsidiaries by about 10 points.

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The plan should also decrease the likelihood mortgage insurance subsidiaries would need additional capital, ensure the ability to write new business, and decrease the risk of a default for Genworth's senior notes.

One action that is part of the plan involved transferring ownership of the European mortgage insurance subsidiaries to GMICO. Under the new plan, should adverse conditions occur, Genworth has the future option of implementing a ""NewCo"" structure to continue writing new business in all 50 states. Genworth also injected $100 million into GMICO on April 1 as part of the plan.

""We are very pleased to have received all the necessary regulatory approvals and fully implement the comprehensive capital plan for the U.S. mortgage insurance business announced in January 2013,"" said Martin P. Klein, EVP and chief financial officer. ""U.S. mortgage insurance is a key component of our Global Mortgage Insurance Division, and the plan increases our financial flexibility while bolstering capital in the business to continue writing profitable new business and returning the business to profitability over time.""