MGIC is in discussions to sell its eMagic unit as well as its Myers Internet business, a company spokeswoman confirmed.
The pair contributes minimal revenue to the company and it has made a strategic business decision to try and divest them, she said. The company has laid off 19 people, including five associated with the two units. It started eMagic in 2000 as a B2B service fulfillment portal and acquired Myers Internet from founder Warren Myer in January of 2006.
Meanwhile, both MGIC and Radian made presentations at the Keefe Bruyette & Woods (KBW) insurance conference held earlier this week on Wednesday.
According to analyst notes from the conference, Radian said it expects the market share mix between private mortgage insurance and the Federal Housing Administration (FHA) to go to a 50-50 split, rather than the historic 70% MI-30% FHA split it had been in the past.
MGIC's presentation included a slide showing that on a hypothetical $220,000 loan private MI was the lower cost option versus FHA for all FICO scores in the 90% loan-to-value range and for all FICO scores in the 95% LTV range except for the 660-679 FICO band.
Radian told the conference it did not expect to be profitable for 2011, which KBW analysts Nathaniel Otis and William Clark said fits their model for the company's performance this year. They added that MGIC believes that its paid losses have peaked.
On the day of the conference MGIC released its August monthly statistics which showed its delinquent loan inventory declined by 1,755 loans, turning around July's 641 loan increase. Still, new notices outpaced cures, 14,587 compared with 11,719, but paid claims and rescissions totaled 4,623 loans for the month.
MGIC had $1.3 billion of new insurance written in August, compared with $1.2 billion in July and August 2010.
