The Bermuda-based Arch Capital Group Ltd. (ACGL) 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 bulletin explained that 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. He joined the Arch group in 2001 and has 20 years of experience in various actuarial, underwriting and senior management positions in the insurance industry. Gansberg will report to Andrew Rippert, who joined Arch in 2010 and has 16 years of experience in the mortgage insurance industry.
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.” He also noted the qualifications of the mortgage division’s “experienced managers.”
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.”
Source: Arch Capital Group Ltd.