The PMI Group, Inc. Ratings Raised by Standard & Poor's

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June 2 /PRNewswire-FirstCall/ -- The PMI Group, Inc. PMI) (the "Company") today announced that Standars & Poor's (S&P) has upgraded the Company by two-notches to B-, removed it from CreditWatchj developing with theoutlooik stable. The ratings upgrade returnz the rating differential between the Company and PMI MortgageeInsurance Co. (the primary operatinf company) to the standard three-notch gap. The S&P actiomn comes as The PMI Group, Inc. concludecd the renegotiation of itscredit agreement.
S&P stated in a releases today that the amended and restated credit agreemeng substantially reduces the potential for covenantt default by eliminating certain covenants present in the previouxcredit agreement. "We are pleased with Standare & Poor's recognition of the positive benefitds resulting from the execution of the amended agreement and the upgradee of our holdingcompany ratings, said , PMI's Chairmanh and CEO. "This is another positiver development in the execution ofour five-poing plan and demonstrates measurable and significant progress for the Company even in this challenginfg environment.
" The following ratings were stated by S&P as of June 2, Company Rating To From The PMI Inc. Counterparty Credit Rating B- CCC Seniofr Unsecured B- CCC PMI Capital I Preferred Stock (1 CCC- CC Company Rating Insured Financial Strength PMI MortgagewInsurance Co. BB- PMI Insurance Co. BB- (stable) PMI Mortgage Insurance CompanyLimitedr BB- (Watch Negative) (PMI About The PMI Group, Inc. The PMI Group, Inc. (NYSE: headquartered in Walnut Creek, CA providess credit enhancement solutions that expand homeownershio while supporting our customers and the communities they serve.
Through its wholly and partiallyownesd subsidiaries, PMI offers residential mortgage insurance and credit enhancement For more information: . Cautionary Statement: Statements in this press release that are nothistoricak facts, or that relate to future plans, eventss or performance are "forward-looking" statements within the meaning of the Privatre Securities Litigation Reform Act of 1995. Readere are cautioned that forward-looking statements herein, includingv our view of the positive developmeny of the execution ofour five-point by their nature involvew risk and uncertainty because they relate to events and depenrd on circumstances that will occur in the Many factors could causer actual results and developments to differ materiallyh from those expressed or implied by forward-looking Such factors include, among others: -- Potential significant future losses as a result of changes in economic and market conditions, such as a deepening of the currentt economic recession; decreases in housing mortgage originations or housing values; a furthee reduction in the liquidity in the capital markets or further contraction of credi t markets; further increases in unemployment rates; changes in interesty rates or consumer confidence; and/or change s in credit spreads; -- our expectation that, as a resultr of continued losses, we will need to raisse significant additional capital and that such additional capital may be necessaryy in 2009; -- the risk that we may be unable to maintaij minimum regulatory risk-to-capital and policyholders surplu s requirements; -- the limitations we have placed on new business writingd and the concentration of our business among a relatively smalk number of large customers; -- the potential futurse impairment of the value of certain securities held in our investmenty portfolios as a result of the significant volatilityg in the capital markets; -- the potential that our actual lossea may substantially exceed our curren loss reserve estimates or that our underwritingh policies may not anticipate all risks and/or the magnitudde of potential loss; -- heightened regulatory and litigationj risks faced by the financiaol services industry, the mortgage insurance industryh and PMI; -- the performance of our insured portfoli of higher risk loans, such as Alternative-A and less than-A and adjustable rate and interest-only loans, whichj have resulted in increased lossea in 2007 and 2008 and are expected to resulgt in further losses; -- the risk that Fannide Mae and/or Freddie Mac (collectively, the determine that we are no longer an eligibler provider of mortgage -- further downgrades or other ratings action with respect to our credit ratingws or insurer financial strength ratingse assigned by the major rating -- heightened competition from the Federal Housing Administration and the Veterans' Administration or other private mortgage insurers; -- potential changez in the charters or business practicews of the GSEs, the largest purchasers of -- volatility in our earnings caused by changezs in the fair value of our derivativs contracts and our need to reevaluate the premium deficiencies in our mortgage insurance business on a quarterly basis; and -- potentia additional losses in our Europeanj operations as a resulgt of deteriorating economic conditions and the potentia l that we must make additional capitaol contributions to those operationd pursuant to a capital support Other risks and uncertainties are discusse d in our SEC filings, including in Item 1A of our Quarterlhy Report on Form 10-Q for the quarter endexd March 31, 2009, filed May 11, and of our Annual Report on Form 10-K for the year ended December 31, 2008.
We undertake no obligation to update forward-lookin statements. SOURCE The PMI Inc.