Genworth delays IPO again

From the AFR:

Genworth Financial has warned of further delays to a partial float of its Australian operations, despite reporting an improvement in third-quarter local operating earnings and a drop in mortgage insurance delinquencies.

Genworth put its mooted $US800 million second quarter 2012 initial public offering on ice earlier this year, after posting first-quarter losses spurred by higher claims and delinquencies from coastal Queensland areas, which were exposed to natural catastrophes.

“Adverse market or other conditions might further delay or impede the planned IPO of the company’s mortgage insurance business in Australia,” Genworth said in a statement as it announced its third-quarter earnings.

Or maybe Genworth wants to wait for a peak in the cycle, such as it is. When it comes, this IPO may be a major sell signal for housing, much like Myer was for retail.

David Llewellyn-Smith
Latest posts by David Llewellyn-Smith (see all)


  1. Diogenes the CynicMEMBER

    They have to be desperate to float this sucker off their books…this is a tactical call for some reason, either they think that next quarter will be good enough to just get it off the ground or they tried soft selling ahead of an IPO and met with stony resistance. Probably both things are happening.

  2. Who in their right mind would buy into this IPO. We hear reports about mortgage stress daily and even their website has a hotline for borrowers with financial hardship.
    The parent company has a junk credit rating and the ratings agencies were expecting this sale to improve its financial situation.
    Our Banks have placed a lot of reliance on this mortgage insurer.

  3. Genworth Australia LMI insures mortgages with a LVR over 80 per cent in a country with the second highest house prices in the world now entering recession. I call that triple-distilled risk. Pure poison.