QBE Insurance has bought mortgage insurer PMI Australia for $1.027 billion.
The acquisition follows PMI Australia’s US parent’s announcement of a second quarter loss of more than US$200 million (A$231 million) earlier this week.
QBE has also entered a principle agreement to acquire PMI Asia.
PMI Australia chief executive Ian Graham said in a statement to the ASX that he looked forward to being part of the QBE Group.
QBE’s CEO Frank O’Halloran said the purchase was in line with a business strategy based on diversification.
“The acquisitions have been structured to allow us to meet or exceed our minimum profit requirements even in the event of extremely adverse economic conditions over the next three years,” he said.
According to QBE, PMI Australia insurers around 40 per cent of the residential mortgage insurance market in Australia.
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