S&P: Old Republic view positive

Moody's Investors Service said it affirmed the Baa3 senior debt rating of Old Republic International Corp. and changed the outlook to positive from stable.

The actions follow the company's announcement that it intends to largely exit its mortgage insurance business through a plan of recapitalization.

This did not affect the A2 insurance financial strength ratings or stable outlook of the lead operating subsidiaries of Old Republic General and Old Republic Title, the A3 insurance financial strength ratings or stable outlook of the group's PMA subsidiaries.

The plan is subject to approvals by various regulators and stakeholders including the North Carolina Department of Insurance, Fannie Mae and Freddie Mac, and is expected to be completed by early 2014.

"The transaction would be credit positive for Old Republic's debt holders as it would allow the company to exit its troubled and financially weak mortgage insurance unit and would eliminate the risk in a downside scenario that a regulatory takeover of RMIC could trigger an event of default and acceleration of ORI's senior debt," Moody's analyst Paul Bauer said in a news release.

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