(Reuters) – Bailed-out insurer
"We're now thinking about maybe we should try to find a way to buy the mortgages that we're insuring,"
AIG's mortgage insurance unit, United Guaranty or UGC, has recently become the largest in its industry, as competitors have faltered amid the pressure of bad bubble-era loans.
With investment returns at a relative pittance, insurers like AIG have been looking for safe alternatives to boost income. There have been rumors in the market for more than a year about insurers buying whole loans as a way to diversify their portfolios and increase exposure to the housing market (without buying mortgage-backed securities).
Benmosche told the paper any such program, if it happens, would not start until the fourth quarter.
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