Dave Wirsching

• Home-Purchase Index in U.S. Plunges to Lowest Level Since 2000

• Fidelity National Financial, Inc. (FNF: News ), reported a swing to profit in the third quarter on higher revenues and lower expenses. However, the profit per share was lower than Wall Street expectations.

• On Wednesday, the House Financial Services Committee approved the Milwaukee Democrat's amendment to exempt credit insurance - as well as mortgage and title insurance - from regulation under a new consumer agency.

• Fitch Ratings lowered its issuer default rating on Fidelity National Financial Inc. (FNF) further into junk territory, while cutting its ratings on nearly all of the company's title insurance subsidiaries to the brink of junk.
• Fitch said the IFS ratings downgrade reflects continuation of an aggressive capital management strategy where the operating leverage of the underwriting subsidiaries has increased to a level beyond peer companies. But Fitch kept the ratings in investment-grade territory as its operating results were both historically, and through the first half of the year, better than its peers.

• Fitch Ratings has downgraded the Insurer Financial Strength (IFS)   ratings of Stewart Title Guaranty Company (STG) and its wholly owned   subsidiary Stewart Title Insurance Company (STIC), collectively referred   to as Stewart, to 'BBB+' from 'A-'. Fitch has also downgraded the Issuer   Default Rating (IDR) of Stewart Information Services Corp. (SISCO), to   'BBB-' from 'BBB'. The Rating Outlook for all ratings is Negative.
• Fitch's rating action was primarily driven by Stewart's below average   profitability relative to peers and declines in statutory surplus.   Through the first half of 2009, Stewart's GAAP pretax operating margin   was -7.7% compared to a peer average of 2.8%. Similarly, Stewart's   statutory capital levels were down 13% since year-end compared to a   dollar weighted peer average of positive 4%.

• Net income was $70.3 million, or 75 cents per diluted share, compared with $19.6 million, or 21 cents per diluted share, in the second quarter of 2008
• Adjusted earnings per diluted share of 89 cents, or 75 cents including net realized investment losses
• Title Insurance and Services segment adjusted pretax margin of 8.2 percent, or 6.6 percent including net realized investment losses
• The company continued to realize operational efficiencies by leveraging its centralized onshore and offshore capabilities.
• The loss provision for claims during the second quarter of 2009 was 6.5 percent of operating revenues, compared with 6.3 percent in the second quarter of 2008. The current quarter rate reflects the expected claims experience for policy year 2009, with no reserve estimate adjustments required for prior policy years.

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• The second quarter of 2009 includes pretax charges of $19.2 million  relating to reserve strengthening adjustments for prior policy years  and $22.4 million relating to several agency defalcations and large  title losses
• The second quarter of 2008 includes a reserve adjustment of $10.0  million relating to prior policy years, $8.2 million relating to  large claims and agency defalcations and a software impairment charge  of $6.0 million.
• For the second quarter of 2009, we reported a pretax loss, before noncontrolling interests, of $16.1 million compared with a pretax loss of $44.2 million in 2008.
• "In the first half of the year, we continued the aggressive restructuring of our agency network begun in 2008," said Malcolm S. Morris, chairman and co-chief executive officer. "We canceled more than 700 higher-risk and underperforming agencies in the first half of 2009 and have canceled more than 3,200 agencies since the beginning of 2007. We continue to embrace the agency market, but we are increasing our diligence, inspection and expectations for these operations. In the first half of 2009, we signed up more than 330 new agencies-all of which were subjected to an extensive pre-signing qualification process. The annual revenues from the newly-signed agencies are expected to significantly exceed the revenues lost from the underperforming agencies canceled this year, and we anticipate that these new agencies will generate far fewer title losses based on our review of their historical loss data,"

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• "Overall, the title insurance market has improved considerably in the first half of 2009, albeit with some volatility, as the significant increase in open order volumes slowed down late in the second quarter as mortgage rates increased. Order counts in July have been consistent with the levels we experienced for most of the month of June and we believe we are in a position to continue to generate solid profitability in today's market environment."

• About 3,500 Coloradans will get refunds totaling $393,000 from title-insurance companies and agents, the state's Department of Regulatory Agencies announced Thursday.
• It said Chicago Title Insurance has agreed with the state Division of Insurance to refund $266,000 to consumers, Chicago Title Insurance agents will refund an additional $115,000, and Fidelity National Title Insurance and agents will refund $12,500.
• Besides the miscalculation of rates, officials said Chicago Title was charging fees for closing services that had not been filed with the Division of Insurance.

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