September 19, 2021

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Mortgage News

Arch Capital Group Ltd. to Acquire Westpac Lenders Mortgage Insurance Limited

PEMBROKE, Bermuda – () – The Global Mortgage Group of Arch Capital Group Ltd. (NASDAQ: ACGL) has entered into a share purchase agreement with Westpac Group (Westpac) to acquire Westpac Lenders Mortgage Insurance Limited (WLMI), an Australian regulatory agency (APRA) authorized mortgage insurance provider (LMI) for Westpac. As of September 30, 2020, WLMI had equity of AUD 285.7 million.

Under the agreement, WLMI will maintain its existing risk and become Westpac’s exclusive provider of LMI for new mortgage origins for a period of 10 years. Upon completion of the transaction, Arch intends to continue the operations of WLMI and its existing Australian LMI company Arch LMI Pty Ltd. to merge.

Arch has been in the Australian LMI market since 2011 when it began supporting WLMI’s reinsurance treaties. In 2019, Arch LMI Pty Ltd was approved as a mortgage lender by APRA. The acquisition of WLMI secures Arch’s Australian LMI business flow from Westpac Bank and strengthens the company’s position as the only globally diversified insurer of mortgage credit risk. In addition to Australia, Arch has mortgage insurance and reinsurance businesses in Bermuda, Europe, and the United States.

“Australia was and is an important market for our mortgage insurance business. This acquisition strengthens our commitment to both the market and our customers and strengthens Arch’s position as the leading provider of LMI in Australia, ”said David Gansberg, CEO of Global Mortgage at Arch Capital Group Ltd. Partnership with Westpac as the exclusive provider of LMI and continues to focus on providing innovative solutions and excellent service to customers across Australia. ”

The transaction is expected to close later this year pending antitrust and regulatory approvals from APRA and the Australian Competition and Consumer Commission.

Consultant

Credit Suisse acted as financial advisor, KPMG as tax advisor and Clyde & Co as legal advisor to Arch on the transaction.

About Arch Capital Group Ltd.

Arch Capital Group Ltd., a publicly traded, Bermuda-exempt company with approximately $ 15.8 billion in capital as of December 31, 2020, provides insurance, reinsurance and mortgage insurance worldwide through its wholly owned subsidiaries.

Cautionary Note Regarding Forward-Looking Statements

The Private Securities Litigation Reform Act of 1995 provides a “safe haven” for forward-looking statements. This press release or any other written or oral statement made by or on behalf of Arch Capital Group Ltd. and its subsidiaries may contain forward-looking statements that reflect our current views regarding future events and financial performance. All statements other than historical facts contained in this press release or incorporated by reference into this press release are forward-looking statements.

Forward-looking statements can generally be identified by the use of forward-looking terms such as “may”, “will”, “expect”, “intend”, “estimate”, “anticipate”, “believe” or “continue” or their negative or variations or similar terminology. Forward-looking statements contain our current assessment of risks and uncertainties. Actual events and results could differ materially from those expressed or implied in these statements. A non-exclusive list of important factors that could cause actual results to differ materially from those expressed in such forward-looking statements includes the following: adverse general economic and market conditions; increased competition; Price and maturity trends; Fluctuations in the actions of rating agencies and the company’s ability to maintain and improve its ratings; Investment performance; the loss of key personnel; the adequacy of the company’s loss reserves, the severity and / or frequency of losses that are higher than the expected loss ratios and the adverse development of liabilities from claims and / or damage costs; greater frequency or severity of unpredictable natural and man-made catastrophic events, including pandemics such as COVID-19; the effects of acts of terrorism and war; Changes in regulations and / or tax laws in the United States or elsewhere; the company’s ability to successfully integrate, establish and maintain operations and integrate with existing operations the businesses that the company has acquired or may acquire; Changes in accounting policies or policies; material differences between actual and expected ratings for guarantee funds and mandatory pooling arrangements; The availability and cost of reinsurance to the company to manage the company’s gross and net exposures; failure of others to meet their obligations to the company; Changes in the method of determining the London Interbank Offered Rate (“LIBOR”) and the possible substitution of LIBOR and other factors disclosed in filings with the US SEC.

The above review of important factors should not be construed as exhaustive and should be read in conjunction with other warnings contained here or elsewhere. All subsequent written and oral forward-looking statements that are attributable to us or to persons acting on our behalf are expressly qualified in their entirety by these warning notices. The company assumes no obligation to publicly update or revise any forward-looking statements as a result of new information, future events or for any other reason.

Arch Corporate

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