Privately Funded Company Looks to Make Waves in Private Insurance

As the Federal Housing Finance Agency (FHFA) makes ""declarations"":http://www.fhfa.gov/webfiles/23408/02-28--2_FINAL_DeMarco_Testimony_SBC.pdf of intentions of ""establishing a path for shifting mortgage credit risk from the Enterprises (and, thereby, taxpayers) to private investors,"" one company in its infancy plans to take advantage of this opening for private mortgage insurers.

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""NMI Holdings, Inc.,"":http://www.nationalmi.com/ plans to ""deploy over $500 million of capital and provide insurance capacity to support the lender marketplace"" starting early next year when it launches National Mortgage Insurance Corporation (National MI), according to the company's EVP and CFO, Jay Sherwood.

Founded by Sherwood and Bradley Shuster--chairman, president, and CEO--National MI raised $550 million in private capital this year to prepare for the company's launch.

Investors include ""experienced institutional and financial services market participants,"" according to Sherwood.

""The capital investment in National MI demonstrates that private investors are prepared to assume mortgage risk as the government looks to decrease its role in the mortgage insurance market,"" Shuster said.

""National MI has been working closely with Fannie Mae, Freddie Mac and their regulators at the FHFA, and is making significant progress towards the goal of writing coverage in all 50 states,"" Sherwood said.

National MI is participating in an accelerated licensing process through the National Association of Insurance Commissioners.

So far, the Emeryville, California-based company employs 60 individuals, and it continues to grow as it approaches its proposed 2013 launch.

Shuster comes to his role with 35 years' experience in the financial industry, having served as president of The PMI Group's international mortgage insurance and strategic investments and previously as a partner at Deloitte, LLP, where he headed the company's northern California insurance and mortgage banking practices.