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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) September 6, 2000
THE PMI GROUP, INC.
(Exact name of registrant as specified in its charter)
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<S> <C> <C>
Delaware 1-13664 94-3199675
(State of Incorporation) (Commission File Number) (I.R.S. Employer Identification No.)
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601 Montgomery Street, San Francisco, California 94111
(Address of principal executive offices) (Zip Code)
Registrant's telephone number including area code: (415) 788-7878
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(Former name or former address, if changed since last report.)
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Item 5. Other Events
In a press release dated September 6, 2000, The PMI Group, Inc. announced that
operating earnings for 2000 will likely increase between 26 and 29 percent to
between $5.70 and $5.80 per share and that operating earnings for 2001 will
likely grow between 17 and 19 percent, to between $6.67 and $6.90 per share. A
copy of the Company's press release is filed as Exhibit 99.1 hereto and is
incorporated by reference.
The Company's statements in this Form 8K and the attached press release that are
not historical facts, and that relate to future plans, events or performance are
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. These forward-looking statements include, but are
not limited to, PMI's estimate that operating earnings for the year 2000 likely
will increase between 26 and 29% to $5.70 and $5.80 per share, PMI's estimate
that operating earnings for the year 2001 will likely increase between 17 and
19% to between $6.67 and $6.90, PMI's belief that stronger persistency, better
than expected loss experience and contributions from its international
operations, investments and subsidiaries will continue to drive growth, and the
Company's belief that it may experience slightly higher losses and claims in
2001. These forward-looking statements are subject to a number of risks and
uncertainties including, but not limited to, the following factors that could
cause the Company's actual results to differ materially from those expressed
herein:
A number of factors affecting PMI and the mortgage industry in general could
cause claims on policies issued by PMI to increase and this could materially
adversely affect the Company's financial condition and results of operations.
The loss experience of PMI could be materially and adversely affected by
economic recession, declining housing values, higher employment rates,
deteriorating borrower credit, rising interest rates, legislation impacting
borrowers' rights, or any combination of such factors. A decrease in
persistency, resulting from policy cancellations of older books of business,
could materially impact the Company's financial results of operations. While
stable or rising interest rates may positively contribute to the persistency
rate, declining interest rates could adversely affect the Company's persistency
rate, its premium yield and its financial condition and results of operations.
The Company's financial condition and results of operations could be materially
and adversely affected by delays in the introduction by PMI of new products or a
decrease in customer demand for new and existing products. In addition, there
can be no assurance that newly introduced products will be as profitable as the
Company's existing products or programs.
The Company's financial condition and results of operations may be materially
and adversely affected by changes to the current legal environment, including,
but not limited to, legislation that would affect the ability of Fannie Mae or
Freddie Mac to offer a substitute for mortgage insurance, legislation that would
increase statutory lending limits of FHA and VA, and proposed risk-based capital
regulations developed by the Office of Federal Housing Enterprise Oversight.
PMI's financial condition and results of operations may be materially and
adversely affected by a reduction in the amount of mortgage insurance coverage
required by Fannie Mae and Freddie Mac. Also, in 1999, a coalition of financial
services and housing related trade associations, including MICA and several
large mortgage lenders, formed FM Watch, a lobbying organization that supports
expanded federal oversight and legislation relating to the role of Fannie Mae
and Freddie Mac ("GSE's") in the secondary mortgage market. The GSE's and other
organizations
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are in the process of forming a coalition designed in part to counter activities
of FM Watch. The Company's financial condition and results of operations could
be adversely affected in the event that these actions polarize the GSE's,
members of FM Watch, PMI and PMI's customers.
The performance of the Company's Australian subsidiary could be materially and
adversely affected by a weakening in the demand for housing, interest rate
volatility, and/or an increase in claims. The performance of the Company's other
strategic investments could materially and adversely be affected by changes in
the real estate, mortgage lending, mortgage servicing and financial guaranty
markets; future movements in interest rates; those operations' future financial
condition and performance; the ability of those entities to execute future
business plans; and PMI's dependence upon management to operate those companies
in which PMI does not own a controlling share.
Any or all of these factors could affect the Company and cause PMI's performance
to differ materially from the forward-looking statements contained in this press
release. Other risks and uncertainties that could affect the Company are
discussed in PMI's various Securities and Exchange Commission filings.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
(c) Exhibits
The following exhibit is filed with this report:
Exhibit 99.1 Press Release dated September 6, 2000
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
The PMI Group, Inc.
(Registrant)
September 6, 2000 By: /s/ Victor J. Bacigalupi
Victor J. Bacigalupi
Executive Vice President,
General Counsel and Secretary
