WINSTON-SALEM, N.C., May 22 /PRNewswire-FirstCall/ -- Triad Guaranty
Inc. (Nasdaq: TGIC) reported today on recent communications and discussions
it has had since last week with representatives of Freddie Mac and on the
current status of the proposed transaction with Lightyear Capital LLC.
As previously reported, Triad Guaranty no longer satisfies either of
the Government Sponsored Enterprises' (GSEs) Type 1 mortgage insurer
eligibility requirements, which has triggered an obligation to file
acceptable remediation plans with the GSEs. Following the filing by Triad
of its Form 10-Q last week, Freddie Mac advised Triad that its insurance
subsidiary is suspended as an approved mortgage insurer, subject to an
appeals process currently underway. Triad intends to vigorously pursue this
appeal with Freddie Mac, which must be made in writing by May 29, 2008.
Freddie Mac has informed Triad that it will continue to purchase mortgage
loans insured or committed to be insured by Triad during the appeal process
unless and until Triad and its customers are notified by Freddie Mac to the
contrary. Triad believes this action by Freddie Mac should not have any
immediate adverse impact on Triad's ability to write new mortgage
insurance, which Triad is continuing to do with the support of the Illinois
Division of Insurance, while it pursues its previously announced proposed
transaction with Lightyear. The benefits of the proposed transaction with
Lightyear to all Triad policyholders and customers will be a key component
of Triad's submission to Freddie Mac.
Mark K. Tonnesen, President and CEO of Triad Guaranty Inc., said,
"Freddie Mac and Fannie Mae are both continuing to accept new insurance
written or committed by Triad. We welcome the opportunity to provide both
the GSEs and our regulators with more details concerning our anticipated
voluntary run-off plan and the benefits we believe can be achieved by
completing the proposed transaction with Lightyear."
Triad also reported that it is continuing to negotiate definitive
agreements with Lightyear Capital LLC, a New York-based private equity firm
focused on financial services, which would result in the creation of a new
monoline mortgage insurance company. Triad and Lightyear continue to work
closely together to obtain all necessary approvals for the transaction.
Completion of the proposed transaction with Lightyear remains subject to
numerous conditions both within and outside the control of Triad and
Lightyear and no assurance can be given that Triad or Lightyear will be
successful in satisfying those conditions.
About Triad Guaranty Insurance Corporation
Triad Guaranty Inc.'s wholly owned subsidiary, Triad Guaranty Insurance
Corporation, is a nationwide mortgage insurer providing credit enhancement
solutions to its lender customers and the capital markets. This allows
buyers to achieve homeownership sooner, facilitates the sale of mortgage
loans in the secondary market and protects lenders from credit
default-related expenses. For more information, please visit the company's
web site at http://www.triadguaranty.com
Certain of the statements contained in this release are
"forward-looking statements" and are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995. These
statements include estimates and assumptions related to economic,
competitive, regulatory, operational and legislative developments. These
forward-looking statements are subject to change, uncertainty and
circumstances that are, in many instances, beyond our control and they have
been made based upon our current expectations and beliefs concerning future
developments and their potential effect on us. Actual developments and
their results could differ materially from those expected by us, depending
on the outcome of a number of factors, including our ability to enhance our
capital resources, the possibility of general economic and business
conditions that are different than anticipated, legislative, regulatory,
rating agency and other similar developments, changes in interest rates,
the housing market, the mortgage industry and the stock market, stronger
than anticipated competitive activity, as well as the factors described
under "Risk Factors" and under "Safe Harbor Statement under the Private
Securities Litigation Reform Act of 1995" in our Annual Report on Form 10-K
for the year ended December 31, 2007 and in future filings by us in other
reports and statements that we file with the Securities and Exchange
Commission. Forward-looking statements are based upon our current
expectations and beliefs concerning future events and we undertake no
obligation to update or revise any forward-looking statements to reflect
the impact of circumstances or events that arise after the date the
forward- looking statements are made.
SOURCE Triad Guaranty Inc.
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Related links:
http://www.triadguaranty.com
CONTACT:
Mark K. Tonnesen, President and CEO, Triad
Guaranty Inc., +1-336-723-1282, ext. 1101, or mtonnesen@tgic.com
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