QBE LMI likely to float in 2015, following Genworth's successful strategy

QBE LMI likely to float in 2015, following Genworth's successful strategy
QBE LMI likely to float in 2015, following Genworth's successful strategy

QBE Insurance Group has announced plans to partially float QBE LMI, its mortgage insurance business.

The insurance giant has penciled in the partial float for 2015.

QBE's LMI division is one of just two mortgage insurers operating in Australia.

Rival Genworth was partially floated earlier this year by its US parent raising nearly $500 million. Its successful float in May was at $2.65 a share, trading yesterday at $3.56 a share.

QBE LMI holds around $1.2 billion in net tangible assets at the end of June.

“QBE LMI’s results have been outstanding and are expected to remain so for the foreseeable future,” QBE chief John Neal said.

“The capital intensity of this business led us to purchase additional reinsurance protection to support the business’ growth plans, however, with the longer term in mind, the introduction of third party shareholders offers QBE LMI enhanced capital flexibility to support its growth ambition.”

QBE today also released its audited half-year profit results, which had been flagged in a profit warning late last month.

The insurer confirmed a net profit after tax of US$392 million, down 18% on the prior corresponding period.

QBE has also announced a capital raising of around $810 million.

Around $650 million worth of shares will be offered to institutions, with $160 million to be sold through a share purchase plan.

Jonathan Chancellor

Jonathan Chancellor

Jonathan Chancellor is one of Australia's most respected property journalists, having been at the top of the game since the early 1980s. Jonathan co-founded the property industry website Property Observer and has written for national and international publications.

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Mortgages

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