MGIC Investment Corp., the mortgage insurer that breached regulators’ capital limits, said it would defer an interest payment on $389.5 million of 9 percent convertible debt until 2022.
The payment had been scheduled to be made Oct. 1 on the junior subordinated debentures due in 2063, the Milwaukee-based insurer said Tuesday in a regulatory filing.
MGIC is guarding capital after eight straight losses on costs tied to soured home loans. The company has declined 53 percent this year on the New York stock exchange and fell 8 percent to $1.60 at 5:49 p.m. in extended trading.
“As long as no event of default with respect to the debentures has occurred and is continuing, we have the option to defer interest for one or more consecutive interest periods up to 10 years without giving rise to an event of default,” the company said in the filing.
The insurer previously deferred interest due in 2009 and April 2010 and made the payments in October of 2010 with proceeds from a stock offering, according to the filing.
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