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Genworth Financial, Inc. (NYSE:GNW)

Q4 FY07 Earnings Call

February 08, 2008, 09.00 AM ET

Executives

Alicia Charity - VP, IR

Michael D. Fraizer - Chairman, President and CEO

Patrick B. Kelleher - Sr. VP – CFO

Thomas H. Mann - EVP , International

Kevin D. Schneider - President, U.S. Mortgage Insurance

Victor C. Moses - Sr. VP – Actuarial & Risk

William C. Goings - President, Life Insurance

Thomas M. Stinson - President, Long-Term Care Insurance

Thomas M. Stinson - President, Long-Term Care Insurance

Analysts

Andrew Kligerman - UBS

Darin Arita - Deutsche Bank

Ed Spehar - Merrill Lynch

Steven Schwartz - Raymond James

Dan Johnson - Citadel

Mark Finkelstein - FPK

Eric Berg - Lehman Brothers

Thomas Gallagher - Credit Suisse

Operator

Good morning ladies and gentlemen and welcome to Genworth Financial, Fourth Quarter Earnings Conference Call. My name is Judy, and I will be your coordinator today. At this time all participants are in a listen-only mode. We will facilitate a question-and-answer session towards the end of this conference call. As a reminder, the conference is being recorded for replay purposes. [Operator Instructions]. I would now like to turn the presentation over to Alicia Charity, Vice President, Investor Relations. Ms. Charity, you may proceed.

Alicia Charity - Vice President, Investor Relations

Thank you and welcome to Genworth Financial’s Fourth Quarter 2007 Earnings Conference Call. As you know our press release and financial supplement where both released last night and are posted on our website. We also scheduled a conference call for 11 o'clock this morning, where Kevin Schneider, the President of our US Mortgage Insurance business will go into some detail on the US Mortgage Insurance business, including the expected benefits from lender captive reinsurance and provide some stress scenarios designed to answer investor questions around those value. The presentation will be posted at 10 a.m. and the webcast again will begin at 11. We look forward to your participation given the limited events noticed.

This morning, you will first hear from Mike Fraizer, our Chairman and CEO and then Pat Kelleher, our Chief Financial Officer. Following our prepared comments, we will open up the call for question-and-answer period. Pam Schutz, Executive Vice President of our Retirement & Protection segment; Tom Mann, Executive Vice President of our International and US mortgage Insurance segment: Kevin Schneider, President of US Mortgage Insurance; Vic Moses, our Chief Actuary as well as other business leaders will be available to take questions.

With regard to forward-looking statements and the use of non-GAAP financial information, some of the statements we make during the call today may contain forward-looking statements. Our actual results may differ materially from such statements. We advise you to read the cautionary note regarding forward-looking statements in our earnings release, or the risk factors section of our most recent Annual Report Form 10-K filed with the SEC, and the resegmentation Form 8-K filed with the SEC in April 2007.

Today's presentation also includes non-GAAP financial measures that we believe may be meaningful to investors. In our financial supplement, non-GAAP measures have been reconciled to GAAP where acquired in accordance with SEC rules.

And finally, when we talked about International segment results, please note that all percent changes exclude the impact of foreign exchange. And with that, let me turn the call over to Mike Fraizer.

Michael D. Fraizer - Chairman, President and Chief Executive Officer

Thanks Alicia. In 2007, Genworth delivered 10% operating EPS growth and in the year at $3.07 operating earnings per diluted share versus $2.80 for 2006. Overall, I'd characterize our 2007 performance as mix, while we delivered goodness and disappointed that we fell short of our original earnings goals. This morning I will first share perspectives on 2007, covering core strength and some misses. Then looking to 2008, I will review the market environment and share key priorities.

Let's start with the progress we made in 2007, shifting our profile to higher growth, higher return businesses, in particular, fee-based retirement offerings and our international lines. In retirement income, we introduced several new products and executed well on a distribution strategy that focuses on top revenue and profit generating distribution partners. This group of what we call focus firms delivered more than 40% sales growth for the year.

In managed money, combining our existing platform with the acquisition of AssetMark has given us a terrific unified approach to the fee-based adviser market. And we will fuel strong growth going forward. We have filed a guaranteed income offering for our managed account platform and see some prospects for expansion here.

Turning to international, growth has been substantial. We made sound progress towards our goal of driving half of our earnings from non-US based businesses by the end of the decade with this segment representing 39% of the earnings for the year. More specifically, Canada and Australia mortgage insurance continue to grow from increasing customer penetration. And payment protection saw strong sales growth in continental Europe, plus our expansion into markets including Poland and Mexico brought attractive growth as well.

We also made sound progress in driving profitable universal life and new long-term care production, while redeploying capital effectively through both share repurchases and dividends.

Now let's turn to some misses. US Mortgage Insurance was a disappointment in 2007. We recognized that it has been a tough environment, tougher than we anticipated, which brings humility and some lessons learned with it. We clearly maintained a more risk adverse product businesses than the rest of the industry in underweighted California through the strong efforts of our dedicated mortgage insurance professionals, whose efforts I appreciate very much.

These decisions led us to outperform competitors, however we could have moved more quickly to underweight Florida and a few other markets and further reduce exposure to alternative products. As we pointed out, our substantial lender captive reinsurance coverage now at 63% of flow risk in force provides important production and will be central to the earnings transition we expect in 2009. So, we anticipate a moderate loss in this business in 2008 followed by a 2009 recovery.

In the investment portfolio, we worked to contain our exposure to residential mortgage-backed securities associated with sub-prime and Alt-A collateral to areas where could be comfortable with the originators, underwriting, product types, geography and ratings, while avoiding CDOs altogether.

In retrospect, we should have held less of these securities at the A and below level. I am disappointed with the speed of which these securities became impaired this quarter, but see the current market values depress below the estimated economic value given today's lack of liquidity for such securities.

So hopefully, we will recover a portion of these losses over time, depending on how market factors and securities actual performance play out.

Entering 2008, we remain cautious given the accelerated US housing market, slowing global economies, financial market volatility, and a shifting interest rate environment. Internationally, after a 14% growth pace, excluding foreign exchange we see that shifting to a 10% earnings growth rate in 2008, still a strong result in this market context. In the US, some retirement and production businesses were performed better in this environment than others, as consumers tend to gravitate towards guaranteed income and basic protection offerings. And we have discussed the transition for US Mortgage Insurance results.

In December, we provided a wide range of outlook for 2008 to reflect market uncertainty and we are saying that play out. In view of the current environment, we see 2008 results coming in at the lower end of the $2.65 to $3.15 operating earnings per share range previously provided, and we will provide, and we will update our outlook fully at the end of the first quarter.

With that as context, let me lay out our key priorities for the year. First, we will navigate the storm in US Mortgage Insurance be the industry leader in improving the risk and profitability business model. Pat will go into additional detail on how we are actively managing risk in this business and the benefits we expect from captive reinsurance coverage.

We will see quality revenue growth as the market continues its return to traditional mortgage insurance solutions, but we will be selective in the business we do. We may also serve as a conduit to bring external capital to the industry as a whole. Second, the growth of wealth management and retirement income remain high priorities for capital deployment. Here, we will build on our focused distribution strategy, product innovation, service initiatives and risk management disciplines. Third, we will grow our international platform responsibly. Let me emphasize, that we do not believe in growth for growth sake.

We will rapidly respond in any geography where we see increased risk or weakening performance and avoid market situations where we don't see a sound risk reward equation. For example, we have acted and are acting aggressively to slow mortgage insurance growth in select parts of Europe, including Italy and Spain where a specific lender or market factors indicated weakness and you will see this in our numbers as we move forward.

Fourth, we are focused on transitioning our long term care insurance and life insurance businesses in different ways. In long term care insurance, we are growing our profitable new block of business with new products, independent distribution expansion, leveraging our clear sales operations, and are optimistic about our partnership with AARP. Underwriting and pricing disciplines remain top of mind here and the rate increase on the old long-term care block is proceeding as intended.

In the life business, we have an ongoing shift towards Universal life building off its strong position in broker distribution, while avoiding stranger or investor-owned life segments of the market. At the same time, we will work to position our term life platform around more attractive market segments and additional distributors. So, it is a better home for capital in what has been intensified as a very price competitive market.

Fifth, we are focused on strong capital management. This includes extracting underperforming capital and maintaining good capital buffers and capital flexibility. Regarding the former, we aim and extending underperforming capital through reinsurance capital markets, actions and could pursue a close block transaction. As you know, we have low-return legacy blocks of long-term care that we continue to work on. With a consolidated reassessment of other business blocks across retirement and protection, we have identified additional spread annuity in life insurance blocks or potential capital extraction and redeployment.

In addition, we will keep a sharp eye on cost in this environment. To wrap up, we enter 2008 with clear strategies that the stage for our ongoing mixed shift towards more profitable and high return business lines that reinforce Genworth as a company that provides financial security. We enter 2008 with a magnified focus on risk management given the environment. And we enter 2008 with a sound capital position with multiple levers that provide a foundation for targeted growth and a commitment to optimize capital redeployment to create value.

With that, I will turn the call over to Pat. Pat?

Patrick B. Kelleher- Senior Vice President – Chief Financial Officer

Thanks Mike. This morning I will focus on how we use risk management discipline to generate sound growth and navigate today's volatile financial market environment. We are being cautious making disciplined choices as we manage existing businesses, our investment portfolio and selectively position Genworth for growth in 2009. I will illustrate this in a few areas. First, how we are managing business risk around the globe to be both selective and opportunistic about growth. Second, how we are managing risks in US Mortgage Insurance through loss mitigation, captive reinsurance and importantly through price, product and guideline changes that will target a high-quality new business portfolio going forward. Third, how we manage risk and return expectations in our investment portfolio through diversification, asset-liability management and credit discipline.

So, let’s start with our international business. In 2007, we saw highly favorable market conditions internationally. This contributed to sales growth, particularly in Canada, and strong 14% earnings growth excluding the positive impact from foreign exchange. We’ve become more cautious since year-end at the downturn and potential recession in the US could cause some global economies to slow. We anticipate some market slowdown, both in Canada and Australia and are already experiencing a slowdown in Europe, most notably in Spain.

In 2008, we expect slowing in housing finance levels and lower home price depreciation in some global markets. This reflects increased mortgage rates and also some liquidity contagion impact from the US market although, nowhere near the extent we have seen domestically. With this market context, we are keenly focused on two strategies. Deepening relationships with our lender partners to help them grow and pulling back in geographies where the risk profile is less attractive. First, in Canada we are gaining share with our customers through product development, service differentiation and lender training program. In Australia, we are focused on both large banks and regional lenders to help them tap the high loan-to-value lending market to further develop their business with first time homeowners.

Second, given the economic concerns we will slow business growth by proactively altering our underwriting guidelines. In Canada and Australia, we are tightening underwriting requirements and restricting loan-to-value distributions in selected geographies. In Europe, we are taking deeper measures to manage risk. In the UK for example, we have an order book and we have limited new flow production. Here our 1 billion of risk in force has an average 64% effective loan to value. In Italy and Spain, where we have a new risk in force, we have taken actions to aggressively tighten underwriting requirements and other measures, resulting in close to 50% sequential decline in new insurance written in the fourth quarter. Growth is expected to slow further in this market as a result of these changes.

Now let's turn to US Mortgage Insurance. First, I'll update you on the loss trends, we saw on the fourth quarter, second I'll discuss captive reinsurance and third I will review the result of the actions taken to improve the risk characteristics of the business we are writing today.

Starting with the fourth quarter loss trends, we continue to see higher losses where there are concentrations of alternative products, including Florida, California, Arizona and Nevada. For example, of the $122 million reserve increase in the quarter, under performing states and products accounted for $106 million or almost 88% of this total. In particular, losses have been significantly higher than expectations in Florida, where the delinquency rate is now over 7% high for a prime-based book of business. We remain focused on enhancing loss mitigation processes and systems, including launching of homeowners assistance web site, expanding use of short sales and working with the GSEs to introduce workout programs to help consumers work through financial challenges and keep their home. Second, I want to focus on the importance of lender captive reinsurance and our expectations for US Mortgage Insurance earnings to rebound in 2009.

We have lender captive reinsurance on about 63% of our flow book and expect coverage to attach on our 2005, 2006 and 2007 books. This provides a significant backstop to absorb expected increase losses in these books. This quarter, we realized about $1 million of benefit from captive reinsurance. If losses accelerate in 2008 we could see material captive benefits in the latter half of the year. Our current view is that captives will absorb a significant portion of our losses in 2009. Now as Alicia said, Kevin Schneider will review the US Mortgage Insurance business and review lender captive in some detail later this morning.

To give you a preview, the 2006 books has made the most progress towards attachment. In aggregate, it was 58% of the way there at the end of the fourth quarter, that's up from 39% in the third quarter, in the 2005 book its 49% of the way there in aggregate. Third let's take a look at step we’ve taken on price, guideline and product changes that are already starting to show results.

In the fourth quarter, we saw sales of Alt-A decline by nearly 75% from the prior quarter, very close to the result we were targeting. Similarly, we saw a sequential drop in sales of 100% loan-to-value products and expect this to build as the geographic restrictions and price increases take effect. Our 2008 goal is to limit sales of Alt-A, sub-prime and A Minus to less than 8% of flow production with remaining 92% comprised of core prime-based business. We have introduced these changes and aligned product repositioning with the GSEs, who are making similar restrictions and price increases. As a result of these changes and opportunities to be more selective in a rapidly growing mortgage insurance market, we expect to build the 2008 book with attractive risk characteristics.

Next, let's take a closer look at risk in return from Genworth’s investment portfolio. We have strong asset-liability management, including duration matching and hedging strategies, to mitigate financial market risk and to assure adequate liquidity. In the current market liquidity, diversification, quality our all-key consideration. At the holding company level, we ended the year with approximately $375 million of cash in short-term investments providing funding flexibility to meet additional near-term needs.

Our high quality portfolio performed well through 2007, although I was disappointed by the impairments during Q4 of $123 million after tax. These impairments included $19 million from various corporate credit and $93 million residential mortgage-backed securities back by sup-prime and Alt-A collateral. In the RMBS category, the impairments reflect the write-down to fair market value of securities not expected to achieve original pricing expectations. All of these write-downs relate to securities that are rated at or below the A level, in line with where we have higher risk exposure. We believe that the fundamental outlook for these assets is better than what is implied by current market valuation based on the quality concerns. Now, setting back to look at overall asset quality and diversification, nearly 50% of our portfolio is in investment grade bonds and only 4% of the total portfolio is below investment grade.

Investments in mortgage and asset-backed securities investments are comprised of residential mortgage-backed securities, commercial mortgage-backed securities and other asset-backed securities. These RMBS securities include $2 billion backed by prime collateral with an average rating of AAA, another $1.5 billion is collateralized by sub-prime loans with 73% rated AAA or AA and 1.4 billion are collateralized by Alt-A loans with 79% rated AAA or AA.

The commercial mortgage-backed securities are about 98% investment grade, with low loan-to-value ratios. About 60% of fixed-rate these have average loan-to-values of 67%, the other 40% is floating and these have loan-to-values averaging only 48%. Our other asset-backed securities have collateral such as primary credit card receivables, automobile loans and student loans; these are highly rated with 78% rated at AAA. We invest in tax-exempt municipal securities, primarily on our non-life portfolio, this totaled about $2.2 billion at year-end and 64% are credits in hand. We underwrite to the underlying credit of each security in which we invest and therefore do not rely solely on the guarantee.

About 85% of these credits are A rated or higher on a stand-alone basis. This portfolio is well diversified and credit performance has been very good with no default. We also have a $9 billion commercial real estate loan portfolio, which is largely comprised of home mortgage loans. Important to note, the average loan-to-value in this portfolio is about 52%, the average loan size is just $4 million and currently there are no loans in default.

The key point here is that we actively monitor and manage investment risk. In addition to active asset-liability management, we diversify exposure by asset class, sector and individual credit and we actively monitor and manage liquidity.

Finally, we remain well capitalized to fund growth in 2008 and to absorb increases in the U.S. Mortgage Insurance losses. First, in the U.S. Mortgage Insurance, we have multiple levers, including changing inter-company reinsurance arrangements that redeployed U.S. Mortgage Insurance capital to fund growth in Australia and Europe, we can also shift U.S. Mortgage Insurance investments to improve risk-based capital level. Next we are intensely focused in our retirement protection business on extracting capital from old long-term care, life and annuity blocks as additional sources of capital.

And finally we can and will flow back growth in areas, which less attractive risk adjust return. Genworth focus on profitable growth, risk and capital management will continue. Events of the past year remind us of how important these disciplines really are. We are cautious about 2008, based upon the uncertain and changing markets we see around the globe.

And clearly 2008 is expected to be a transitional year. Our focus during this period is on making disciplined choices to position Genworth for future growth and meet our longer-term financial goal.

With that, I will open up the call for questions.

Question and Answer

Operator

[Operator instructions] Your first question comes from the line of Andrew Kligerman with UBS.

Andrew Kligerman - UBS

Hi, good morning, everyone. Few questions, first with respect to your comments about 10% growth in international and you alluded to some issues in Spain and Italy. What did you say... I mean the loss ratio was a superb 29% in international mortgage insurance. What might we be looking to see during the course of 2008 given your more cautious comments about international?

Michael D. Fraizer - Chairman, President and Chief Executive Officer

Thanks, Andrew. Let me turn that over to Tom Mann.

Thomas H. Mann - Executive Vice President , International

Andrew again as we wrapped up 2008, very pleased with what we saw, we did see an ...

Andrew Kligerman – UBS

2007.

Thomas H. Mann - Executive Vice President , International

Excuse me, I'm sorry, 2007.

Andrew Kligerman – UBS

Sorry [ph], I'm really excited.

Thomas H. Mann - Executive Vice President , International

Well, I'm excited about 2008 too. I'm sorry about that. We did wrap up 2007 in very good shape. We did have an up tick in our European loss ratio in the fourth quarter. If you focus on the supplement where they provided, it actually touched about 59%. As we look towards next year, we have provided in the outlook or is reflected in the outlook that Mike provided to you. We are looking for continued strong performance in Canada and Australia and we're looking for increased loss ratios in Europe. They do reflect the slowdown that we are seeing in Spain.

Andrew Kligerman – UBS

I mean when you say increased in Europe, you are thinking something 100% range like we're seeing in the U.S. or does it sort of stabilize something--.

Thomas H. Mann - Executive Vice President , International

Andrew, it’s... we currently there... our pricing levels in Europe was about 62% to 65% level. We will expect to see it increase over that next year and we provided that in the outlook. But I'm not going to get into the exact range that we may see there. But, it will be above pricing and I want to remind you that when you think about Europe, it's only about 5% of our global risk in force and Spain is about 2% and so our risk in force in Europe is comparatively small because of very low coverage levels that we have on a prolonged basis there. And as you look at the total European equation, again Canada will be very sound. We're actually expecting Australia to maintain similar levels to 2007, possibly come down. So I think we're going to have a very, very strong global performance in 2008 and again the diversity of the book and the global economy is what we've strived to have to help us offset individual issues that we may have on a country-by-country basis.

Andrew Kligerman – UBS

And then, just my other question is with regard to capital. The commentary, the outspread annuity, life insurance, or potential capital redeployment. Could you give us a sense of how much capital you're thinking in aggregate of unlocking and what is there [ph]?

Thomas H. Mann - Executive Vice President , International

Yes Andrew as we talked about at the Investor Day, we were looking at some blocks that in total add up to about 1.4 billion across some of the life and annuity lines and then look within those and see, what portion of those where tapped any more specifics on that?

Michael D. Fraizer - Chairman, President and Chief Executive Officer

No, that's exactly right.

Andrew Kligerman – UBS

And you feel like there is some high likelihood this year that you are unlocking some of this?

Thomas H. Mann - Executive Vice President , International

Again... as you know we unified retirement and protection and put them all under single leadership, early last year and as we did that and integrated all of the teams and the functions, we just took a fresh look, a fresh reassessment of where do you get relative return in, where our opportunities. And as we completed that in the fall time frame, that's where we identified this. So, yes, we work intensively on attacking a portion of that.

Andrew Kligerman – UBS

Thanks a lot.

Operator

Your next question comes from Darin Arita with Deutsche Bank.

Darin Arita - Deutsche Bank

Good morning. Just a question on Canada and on Australia, it sounded like, Genworth is tightening it's underwriting there and I was just wondering if that's a reflection of... seeing any fundamental deterioration in those markets or is it really a response to what's happening on a macro level?

Michael D. Fraizer - Chairman, President and Chief Executive Officer

Tom you want to take that?

Thomas H. Mann - Executive Vice President , International

Hi, Darin it is entirely precautionary, we have not seen a material deterioration in any way, shape or form really in the Australian or the Canadian economies. In fact, Australia, the consensus in Australia is going to be continue to perform very well despite what may happen in the United States environment. But again when we look at the region of this concentrations that we have there and also particularly areas around New South Wales, we want to make sure that we are precautionary and it's really the same story in Canada as well.

Canada is a little bit more directly linked to the United States, in other words when we do have slow downs in the U.S., you would see… find it's way to Canada, a little bit more directly. But again the consensus in Canada is per of degree of slow down, nothing immaterial but the moves entirely precautionary.

Darin Arita - Deutsche Bank

Thank you, and just a question on capital, it sounds like we're slowing the growth appetite in international here, at least in the mortgage insurance side, so, can we take that, I mean there will be increased excess capital generation in 2008?

Thomas H. Mann - Executive Vice President , International

At this point in time, we are seeing a bit of a slow down as you described. But at the same time, we're seeing some uncertainty in kind of looking at the U.S. economic environment. So, we haven't updated our projection at this time and will give you a more complete view or more updated view at the first quarter.

Darin Arita - Deutsche Bank

Okay, thank you.

Operator

Your next question comes from the line of Ed Spehar with Merrill Lynch.

Ed Spehar - Merrill Lynch

Okay, good morning. I had a few questions. I guess, I'm sorry if I missed it. But in terms of capital, I think you've said you're going to update projections down in the first quarter. What about the... what you said about share buyback, the 500 per year for the next couple of years, is there any change there?

Patrick B. Kelleher- Senior Vice President – Chief Financial Officer

Ed, let me give you a couple of perspectives on capital. Again we ended up with about the same capital capacity we talked about at Investor Day, $900 million overall. Going through where we are right now, that's probably roughly $800 million, and now when we look at capital deployment, of course we're going to be selective as I talked about in business where we think it make sense. So we will first go there. When it comes to the share buyback, we bought back at this point probably about $100 million worth of shares that we will do that gradually as we have see the… see it making sense in the market. I would rather use for example capital from lower return blocks of business to buy back shares with. This is not a market when you look at the pricing where you would use things like debt or hybrid financing and we deploy that to share buyback. I just don't think that, I don't think that it’s prudent, I don't think that it is very economically attractive given how some of the debts in the hybrid markets are priced as well.

So, we will stay looking at this on a gradual basis preferring to redeploys capital from low return blocks to fund any buybacks as we move through the year.

Ed Spehar - Merrill Lynch

So that, to be clear, $100 million is that sort of what you are saying done in January?

Patrick B. Kelleher- Senior Vice President – Chief Financial Officer

I'm just saying, that’s from December.

Ed Spehar - Merrill Lynch

Okay.

Patrick B. Kelleher- Senior Vice President – Chief Financial Officer

We had 24, plus an incremental amount that we brining total to date since we announced the two-year billion-dollar organization to $100 million.

Ed Spehar - Merrill Lynch

Okay. And then the other question I has, I wanted to get some clarification Mike on the comment you made, I think up front about, something like we may serve as a conduit to bring the capital to the industry as the whole. Could you talk about what you mean?

Michael D. Fraizer - Chairman, President and Chief Executive Officer

Sure. In fact, Kevin why don’t you take that since you've been looking at this area.

Kevin D. Schneider - President, U.S. Mortgage Insurance

Good morning Ed, Mike’s comment, I think given the current credit environment and the potential for higher quality business growth that we see out there as guidelines get firmed up and tighten and pricing improve. There is obviously some discussion that more insurance industry could be looking for some capital. At the same time, there are others looking to provide capital in that same type environment as a look at the same opportunity.

And since Genworth is viewed as a good manager of risk and of capital, we could provide the expertise to more effectively deploy some of that capital. That can be accomplished in a couple of different ways. It could be accomplished through reinsurance entities, it could be accomplished through ventures, so we are exploring a number of things there and will remain… will update as we proceed on that.

Michael D. Fraizer - Chairman, President and Chief Executive Officer

Ed just to be clear, doesn't change our capital allocation, we see new interest… new capital interested in coming in. So again we consider this an avenue.

Ed Spehar - Merrill Lynch

Okay. That's what I wanted to be clear, and then the final question is we sort of seen how the US MI business can deteriorate in a very challenging environment. Can you help us understand… if you had a really bad year in international and let's say your geographic diversification did not work as you would expect it to overtime. Can you give us any sense of what a really bad year in international is in terms of loss ratio to deterioration? Is it possible for it to be up 10 points in a year, 20 points in the year, I mean, just the thing on that I think would be helpful.

Michael D. Fraizer - Chairman, President and Chief Executive Officer

I guess Ed, let me ask you a clarifying question is, when you point towards a really bad year I think you're pointing towards… are you talking mild recession, deeper recession on a global basis.

Ed Spehar - Merrill Lynch

I'd say, let's just say a deeper recession. Mild to deeper recession on a global basis and we don't have the benefits of diversification that maybe you would assume.

Michael D. Fraizer - Chairman, President and Chief Executive Officer

Let me then just give you a general perspective on a recession. I think that might be a way for you to think about it. First of all, technical definitions of recessions and look at... what I'll call practical definitions of recessions. So you look at corporate performance what that mean to equity markets and credit performance and investment portfolios. You look at employment levels, you look at consumer buying and payment behaviors because either it impact spending or their investing and protecting behavior or the default risk on forms of loan. We'll of course look at interest rates and then we look at real estate markets. Both residential on the one hand and commercial on the other, residential for mortgage insurance, commercial saying how do you feel about your investment portfolio though I think Pat made it quite clear, we feel just fine on that basis.

When you put that all together, if you cut across international, you would see sort of something like about in a mild scenario about $0.07, $0.75 of pressure in a heavier scenario you might be looking at $0.13 of pressure in international with a severe global recession and how that would play through. I think that might be one way to look at and Tom you want to provide any more specific color?

Thomas H. Mann - Executive Vice President , International

This is Tom. I'll like to go back to something they also pointed out in the first quarter earnings call and I think it's very important to remember that the global housing markets are virtually nothing like those that we do have in the United States. They are not... the number we announced with non-prime originations globally with the exception of that would possibly be the United Kingdom. The global markets are categorized by larger banks, some reliance on the capital markets, but much less on the mortgage-backed security markets. And as of this moment we are seeing some liquidity impacts but very, very manageable in Australia and Canada and a little bit deeper in Europe.

And when you think about the fact that it is the liquidity issue that is driving the issues in United States that to me gives me a relative degree of comfort when I look globally. Now there is a question that if you have US slowdown, what is the contagion impact globally, and I want to keep reminding everyone that we have already reflected some economic slowdown in the projections that Mike and Pat gave you earlier. I want to continue to point out that about 95% of our risk in force is in Canada and Australia, and I if I bring it down, work through those for you very, very quickly, the Australian economy, while historically somewhat linked to the United States has not been linked in a big way. We do expect, and I think Australia expects a very limited impact. Home price depreciation actually accelerated in 2007 and the buyers in Australia today is actually towards raising rates and that's what we've seen in other words there are growth and inflation concerns.

So we are watching what's in Australia because of these commodity base as I said earlier, we are watching some area of New South Wales and we are taking precautionary actions, but I do believe that despite what may happen in the United States, Australia is going to be reasonably solid.

In Canada, it is a little more directed, link to the United States as I talked earlier. We do expect home price depreciation to moderate. We do expect interest rates however in Canada to begin to fall back next year, which would be a benefit to their economy similar to what you're seeing in the United States. We continue to watch their economically based regions, particularly this Pacific region and Alberta as well and some selected areas around Ontario, that are uniquely linked to the United States manufacturing or exports United States particularly in the [inaudible] industry, but the linkage in Canada I think little bit more pronounced but we feel very, very good about it.

The area that we are being very careful about is Europe which is, as I said earlier it is about 5% of our risk in force, so that's not giving you any specific loss ratio sensitivities, I think Mike covered that, but again I think when you look at our businesses, terrific revenue growth next year reflecting those on our premium reserves, strong diversity and two large economies that we think will do pretty well in 2008.

Ed Spehar - Merrill Lynch

Thank you, very helpful.

Operator

Your next question comes from the line of Steven Schwartz with Raymond James.

Steven Schwartz - Raymond James

Hi, good morning everybody. Just three, three questions. First, just looking at the revised outlook, Mike or Pat, I'm kind of interested... in the Investor Day you provided... you provided a split off between USMI and the rest of the businesses, do you see both segments down at the lower end of the range, or do you see this being much more driven by USMI?

Michael D. Fraizer - Chairman, President and Chief Executive Officer

We have seen two things. One is as I said, we would see USMI at a moderate loss, in other words, that could be between, some place between a breakeven performance and the down side scenario, we're losing about $100 million that we showed at Investor Day. I'd say it is too early to call that, you have to look at the market factors. And then the other factors, interest rates, some slowing economies, you look at the equity markets here. That had some moderating impact and you have to put those all together, and that is why we talked about the lower end of the range.

Steven Schwartz - Raymond James

Okay, fair enough. Pat what are you using for the base for international to come up with that 10% number?

Michael D. Fraizer - Chairman, President and Chief Executive Officer

We're basically... we basically took out the FX. If you look at the year-over-year we had, first of all we of course had some pickup with the earnings curve adjustment.

Steven Schwartz - Raymond James

I'm talking about '08 versus '07, presumably you are not assuming the FX.

Michael D. Fraizer - Chairman, President and Chief Executive Officer

Yes, that is my point though, if you're looking at the 10% lead, first of all you have to say what is coming off of it, it's coming off of ‘07. So when we take out the FX, '07 came in a little higher with the earnings update. So the assumption then is basically a little slower growth from 14% to 10% on a comparable basis, when you strip out the FX impacts and recognize that we were little heavier in the fourth quarter than anticipated as far as delivering profits with earnings curve update.

Steven Schwartz - Raymond James

Okay, got you. And then...

Michael D. Fraizer - Chairman, President and Chief Executive Officer

Hold on, Pat may have some additional color on it.

Patrick B. Kelleher- Senior Vice President – Chief Financial Officer

If you're just looking for a number, we are looking for the growth of $585 million.

Steven Schwartz - Raymond James

Okay that is good. And then, Tom, you just touched upon with Ed, the market is so different in Europe. They don't have the products maybe even the same products that we have here in the United States. So what entails slowing your business down in Europe. What kind of steps do you have to do to make that happen?

Thomas H. Mann - Executive Vice President , International

Steven, again a great question. It is very important as you said; you remember that the products around the world are very different than in the United States. You've got to remember that our European growth has been recent and therefore we have been growing the business over the past two years in face of some very nice economies. So what we're seeing in Europe, particularly in Spain, is a slowdown. And we are expecting some upward pressure on unemployment. We do believe that Spain is going to experience and is experiencing a more material liquidity impact than the rest of Europe, and certainly the rest of the world. And we've seen home value soften in the fourth quarter, and we expect them to fall next year as well. So, which attempted to be proactive in that regard and some of the items, the areas that we'd focused on is very similar to what you've seen in the United States is a significant reduction in our high loan-to-value products levels, for instance we are capping those at 95% max and limit into 90% in many of the areas of Spain and Italy.

We have tightened underwriting guidelines. We are working to reprise many of our product there as well. So I think as I believe Pat mentioned to you earlier those are the actions that we are taking and will continue to take. It did result in a 50% reduction of our new insurance written in the fourth quarter and again that is a measure of the effect of those actions. And in addition to that, based on the actions that we are taking and we will take, we do expect that for instance our Spain new insurance written level to decline approximately two thirds in 2008. So in summary, it's really loan-to-value differentiation, underwriting and regional dispersion of new product.

Steven Schwartz - Raymond James

Okay. Great. Thank you.

Thomas H. Mann - Executive Vice President , International

You're welcome.

Operator

Your next question comes from the line of Dan Johnson with Citadel.

Dan Johnson - Citadel

Thank you very much. Just a clarification and go back to this 10%. Was this referring purely to the International MI outside of Canada and Australia? Still trying to tie what's the base is that we are talking about.

Patrick B. Kelleher- Senior Vice President – Chief Financial Officer

This is Pat. It's total International.

Steven Schwartz - Raymond James

Total International. Got it. Got it, got it. Okay. Let's see here. On the portfolio what were you seeing in the Alt-A environment? I can't recall exactly what other people have done. I haven't seen a whole lot of write-downs, I think of Alt-A. What are you seeing in the marketplace that… on the investment side that led you to revalue those assets?

Patrick B. Kelleher- Senior Vice President – Chief Financial Officer

Let me turn it over to Vic Moses, who is our Chief Actuary and leads our risk management organization.

Victor C. Moses - Senior Vice President – Actuarial & Risk

This is Vic. Looking at Alt-A we think actually the performance on Alt-A has held up fairly well. To date, we are seeing some slowdown in prepayments and some rises in delinquencies. We cash flow tested any of our securities that were below investment grade and actually tested many of that were above investment grade for performance. In the end, in the Alt-A portfolio, we took year-end impairments of only about $34 million pre-tax. And that number reflects some securities that actually didn't show principle impairments, they just showed cash flow failure or due to the timing of the actual receipt of funds. And that securities purchased at a premium for example that are extending in this environment.

So overall Alt-A still continues to perform reasonably well and we hope that continues to do so.

Steven Schwartz - Raymond James

When you look at the actions of the rating agencies that you're somewhat busy in the fourth quarter. But, got really busy here in January. Can you tell us within the sub-prime portfolio, how much of that portfolio got downgraded during the fourth quarter and then how much of it ahs being downgraded since the fourth quarter, since that looks like where most of the action has happened?

Victor C. Moses - Senior Vice President – Actuarial & Risk

I don't have the actual numbers for downgrades in the fourth quarter that is already going to factor in the year in the analysis that we've done. We did take a hard look at securities that were downgraded in the first quarter and S&P took actions in January those actions effected 22 of the securities in our portfolio. Looking back at the impairment analysis we did on those, we had impaired 12 of those, I think three to four of them are already non-investment grade, that amounted to about $42 million of our right downs for the quarter, there were 10 securities we didn't impair and the book-to-market on those 10 securities is about $37 million.

Steven Schwartz - Raymond James

And the underlying value of those securities?

Victor C. Moses - Senior Vice President – Actuarial & Risk

Book values?

Steven Schwartz - Raymond James

Yes, roughly.

Victor C. Moses - Senior Vice President – Actuarial & Risk

On the portion that we impaired about a 100 and... total population about $125 million of book value.

Steven Schwartz - Raymond James

Can you remind us what your OTTI policy, how long the things have to stay down before you have to take it through the income statement. If it's… at all mechanical?

Victor C. Moses - Senior Vice President – Actuarial & Risk

I think, I can... I'm not the accountant here but let me just give you my take on it. We don't impair these on a time and distance basis, these are impaired on a cash flow testing basis. So any securities that goes below AA, we will cash flow test each quarter. So, we are actually looking at our best estimates of the return on the cash flows.

Steven Schwartz - Raymond James

Great. And then one last one on the mortgage side of the HPA outlook. What are we... what's our best estimate now in light of all the economic data we've seen, what do we thinking about HPA for '08 and '09? Thank you very much for taking the questions.

Michael D. Fraizer - Chairman, President and Chief Executive Officer

Yes, Dan first, I just want to Pat to finish answering your question on the valuation approach then we'll go to HPA. Okay. I just wanted to give you very specific answer, we don't have a bright line test with respect to looking at those securities that Vick was talking about, but we take a very hard and detailed look at everything that significantly impaired beyond the six months period. Okay Kevin let's, Kevin you want to pick up on Dan's HPA question.

Kevin D. Schneider - President, U.S. Mortgage Insurance

Yes. I think the best way to think about HPA continues to be... to think about it in terms of, sort of peak to trough [ph] declines and we had last started to total run in that peak to trough was going to be about in that range and our current view is that's going to continue to extend out to about 14%. So as I think about that it's about 3% that we realized in 2006 roughly another 6% that we realized in 2007 really from the end of '06 to '07. So another 6% or so to go and that continues to be a fluid number and we updated accordingly as inventory supply seem to continue to grow in the market.

Steven Schwartz - Raymond James

You'd expect that remaining 6% mainly or I guess exclusively to fall into '08 at this point?

Kevin D. Schneider - President, U.S. Mortgage Insurance

I think that 6% is primarily '08 with some recovery presented with... beginning to recover in '09, but obviously there is pressure on that 6%.

Steven Schwartz - Raymond James

Yeah, understood. Thank you very much.

Michael D. Fraizer - Chairman, President and Chief Executive Officer

Thanks, Dan.

Operator

Your next question comes from the line of Mark Finkelstein with FPK.

Mark Finkelstein - FPK

Hi. I have got a few questions. Just to go back to international, I think you covered EMI side. I am actually curious about payment protection. I guess what is the historical sensitivity to earnings from change in the economic environment? That's my first question.

Michael D. Fraizer - Chairman, President and Chief Executive Officer

Tom, do you want to take that?

Thomas H. Mann - Executive Vice President , International

Sure, I'd be happy to. Let me just step back for a little bit and remind you that in our payment protection business the coverage that we provide is triggered by several events, if you will, death, accident, disability and very importantly involuntary unemployment. And also remind you that of our portfolio insurance in force if you will only about 25% of that is dependent on unemployment. The other reminder is that as part of our risk management process, as we have discussed we use exclusions, waiting periods and our claim payments are also capped typically on unemployment basis of 6 to 12 months and we also enjoy lender risk sharing arrangements. So, as you look to next year we have reflected unemployment in the European market and I guess a broad rule of thump for you on that is that, 1% to 2% changes in unemployment it will impact earnings next year as Mike said about $0.01 to $0.02.

Mark Finkelstein – FPK

Okay, great. Just going over to traditional life real quick, you talked a little bit about the… I guess the lapsation in some early to mid 90s blocks of term business, I guess just looking at the earnings impact in this particular quarter where we at in terms of that lapsing? Are we kind of pass the trough or... what can we expect gong forward and I guess remediation efforts are you looking at right now?

Michael D. Fraizer - Chairman, President and Chief Executive Officer

We've have Bill Goings here who leads our Life business. Bill, do you want to take that?

William C. Goings - President, Life Insurance

Yeah, just stepping back a little bit over the past several years we have seen declining retail prices on the term business. We've also seen consumers shift to Universal Life and probably some recent potential recessionary pressures we are experiencing higher lapses versus pricing in certain business underwritten in the early 90s as it enters the post-level term period. Overall lifetime persistency remains in line with or better than pricing, so this is really a timing issue in terms of when new profit actually emerges from this book. We experienced some pressure on the fourth quarter of about $10 million versus the prior year, these blocks are still in the very early periods of coming out of post level period and if the trend continues we could see pressure… further pressure in 2008. We are pro-actively monitoring these blocks and we are evaluating options to reduce the impact should the trend continue such as for the conservation efforts or exchange products or pricing adjustments.

Mark Finkelstein – FPK

Okay, great. And I guess if you can address this on the call later today, that's fine. I'm just curious about, in the US MI business, I mean some more kind of cautious outlook and kind of updated thinking in terms of delinquency experience, severity et cetera. Does that have any impact on any changes on how you thought about the sensitivities on '09 earnings that you… December Investor Day?

Michael D. Fraizer - Chairman, President and Chief Executive Officer

Well, I'll just give you a general perspective, and I would encourage you to look at all of the leverage Kevin will layout on the 11 AM call is, I think the real dynamic is we still see the value of the captives coming late in the year and then providing a positive impact in '09. As Pat stated, as I've stated and Kevin as well as if you see loss acceleration, the cap is simply going to attach earlier and that provides more of an '09 impact. So we will have to see how the next couple of quarters play out, but if you go back over several quarters, even you are seeing an accelerating trend towards attachment.

Mark Finkelstein – FPK

Okay. Thank you.

Operator

Your next question comes from the line of Eric Berg with Lehman Brothers.

Eric Berg – Lehman Brothers

Thanks very much. Good morning Mike, and good morning to everybody else and I guess Richmond. So can you hear me, by the way?

Michael D. Fraizer - Chairman, President and Chief Executive Officer

Yeah. We can hear you. Good morning Eric.

Eric Berg - Lehman Brothers

Good morning. Thank you. So, first question relates to domestic MI. Tom has made very clear over the last couple of years, how different your book-of-business is from that of competitors. But one of things, we calculated last night is sort of how much you are holding in reserves, current dollar of delinquency and it does appear to be currently dramatically less but no visibly less than your competitors? My question is... my first question is , I have couple more after this, what could cause your reserves per dollar delinquency to be less than competitors?

Michael D. Fraizer - Chairman, President and Chief Executive Officer

Kevin you want to take that.

Kevin D. Schneider - President, U.S. Mortgage Insurance

That's really... in my mind there is a couple of things. Eric, one is when you look at our reserves for delinquency, it probably has, it's much lesser impacted due to the business we've done in our bulk channels than some of our competitors having not done the bulk sub-prime and some of the other products. I believe, that is probably reducing the number. Additionally, we have experienced nice growth over the past two years off of the lower insurance in force base and as the delinquencies develop through a normal seasoning pattern on that new production as those are new younger delinquencies that come online, as would be expected, and generally based upon our reserving process those are, as they hit the number are being reserved at a lower level until which point, they might age through the delinquency channel.

Eric Berg - Lehman Brothers

Okay, a couple of questions, related questions, for Pat to finish up here. When you talk about loan-to-value calculation, the loan-to-value on CMBS. Is this the original loan-to-value on the underlying loans, and is it sort of an average of the loan-to-values or weighted-average. Is this just, what exactly are we talking about here in terms of timing and calculation when, if you talk about loan-to-value ratios?

Michael D. Fraizer - Chairman, President and Chief Executive Officer

Pat, yes, its original and yes it's basically a weighted average.

Eric Berg - Lehman Brothers

Why would it then be, why is it helpful statistic, if, I think let's say there had been significant depreciation in the value of properties. I would think, be most warranted [ph] in current loan-to-value.

Michael D. Fraizer - Chairman, President and Chief Executive Officer

Not all securities reporting particularly on CMBS type investments, provides that information as part of the package. So we were trying to give you consistent measures, which would be useful in helping you to understand the risk profile of the portfolio.

Kevin D. Schneider - President, U.S. Mortgage Insurance

I'll just add to that, as you may know I'm an old commercial real estate guy from the '90s and we've always taken very conservative stands in how we wanted to approach commercial real estate lending. How we underwrite the cash flows, wanting to have good equity cushions. So the fundamental principal there is to give you an idea how much cushion you're starting at, with again not all of these being like just recent CMBS, we've layered them in over the years. So on a number of these markets you had appreciation. So even if there is an adjustment overtime in the commercial market, it gives you a sense of how much buffer is there in a debt structure. That is the only point that we try to convey on that and as Pat said, if we could have current, I' mean, all the services provide the current information that will of course be a statistic that could be a valuable and aggregated as well. But we do monitor that. We just don't have that padded up from an individual monitoring standpoint for you.

Eric Berg - Lehman Brothers

Fair Enough. Last question for Pat again. When you talk about the… with respect to the model on guarantors, financial guarantors and how you are not only looking to… of course, you are not only looking to their guarantee and are doing underwriting of the underlying securities and they are rated, I don’t remember the percentage of traded A or AA, but whose rating is this? Is this Genworth rating this single A or is this… when you talk about the underlying rating being A, is this in almost every instance coming from an independent source or this your assessment of the credit worth of the underlying credit?

Patrick B. Kelleher- Senior Vice President – Chief Financial Officer

Well, the numbers that I reported are coming from kind of an independent kind of rating service. But what I would also say is that consistent with kind of the analysis of how we price these securities and value them that we shared with you kind of in, I guess, prior disclosures, the important thing to kind of highlight is that we do underwrite each of these securities. We make our own evaluation of their value and then we take a look at what we’re being paid and how the security is rated and we only make those investments where we think they make economic sense. Okay?

Eric Berg - Lehman Brothers

Yes, I got it. Thanks very much.

Operator

Ladies and gentlemen, the last question will come from the line of Tom Gallagher with Credit Suisse.

Thomas Gallagher - Credit Suisse

Good morning. Couple more on USMI and then one on long-term care. The first one is, and I think you're going to talk about this bid in your call later, but I do know if you can simplify and put it in kind of high-level terms? In light of the deterioration that you're seeing in USMI, can you talk a little bit about the sensitivity and the probability of loss ratios piercing through the back end of some of this captive reinsurance? You're not so much on the 4 to 14 coverage, but more on the 5 to 10. Is there… even on discretionary, you still having a very good buffer and it relates to your expectation there? That's my first one?

Kevin D. Schneider - President, U.S. Mortgage Insurance

All right, Tom. This is Kevin and you are correct, we will cover that in detail at 11 o'clock. However, I think the simple way of thinking about it is when we look in aggregate and sort of average the attachment point in and the attachment point out for both the 40s and the 25 excessive loss agreements and all the various other similar structures. Our view, basically you'd have to run at sort of a 15-type frequency rate for the entire 2005 to 2007 books to pressure you, to sort of come out the back-end aggregate captive here. We view that as highly unlikely and there is a lot of room between where we are today and what it would take to experience that. And I'll drill down on that further with additional sensitivities at 11 o'clock.

Thomas Gallagher - Credit Suisse

Okay. And that 15%, Kevin relates to a delinquency or a default?

Kevin D. Schneider - President, U.S. Mortgage Insurance

No, it's... and let me try and clarify that. It doesn't relate to a delinquency, it’s ultimate claims frequency. And so we will also talk about the distinction between delinquencies, defaults, and frequency on this afternoon. Delinquency is a sort of an early indicator of loans that are behind on the payments, claims frequency is a loan on which we make a claim. And that would be talking about claims frequency when we talked about that 15% number.

Thomas Gallagher - Credit Suisse

Okay. And the... and just I don’t know if there is any historical context you can put on a 15% number, is that...

Kevin D. Schneider - President, U.S. Mortgage Insurance

I can. It's a great question. The last time we saw a 15% claims frequency, for any even individual book of your business was back, I think, in ‘82 during the oil patch crisis. So, in one year, back then... one book year that aged through the oil patch crisis grew to a 15.

Thomas Gallagher - Credit Suisse

Okay. And that was.... that was the worse we’ve pretty much seen and that was in ‘82 and that was just one book year.

Kevin D. Schneider - President, U.S. Mortgage Insurance

You never had three book years in a row. I don't think, and what I was talking about is three collective book years all hitting 15 in that sensitivity.

Thomas Gallagher - Credit Suisse

Great. Okay. And then, the other question is, did I hear... did I hear you or someone else on the call mentioned, I think, that you're seeing more deterioration in your prime book. Just curious, you should think about that experience and if you're seeing a real change there?

Patrick B. Kelleher- Senior Vice President – Chief Financial Officer

What we're pointing towards was the Florida… was Florida delinquencies and that Florida delinquencies and the Florida, in general, was one of the clear pressure markets. And that the delinquency you'd see in Florida would be high for a prime book when you look on a national basis. But beyond that when you look nationally, as Kevin said, and we will walk through, we should expect Florida to be an exceptional market as it's shown it has been. So, that's fair with the context.

Thomas Gallagher - Credit Suisse

Okay. So, it’s very much a regional comment as opposed to across the book?

Patrick B. Kelleher- Senior Vice President – Chief Financial Officer

I mean that was a specific state comment explaining again, where have we seen a disproportionate level of the pressure coming from.

Thomas Gallagher - Credit Suisse

Okay. All right, that's helpful. Last question I have is just long-term care run rate, if I understood the numbers correctly, was in sort of the high $20 million range for the quarter, and I don’t know if that… I guess there were a lot of true-ups. So, I just want to make sure that I’m understanding this one. That was below the run rate we’d had for the prior nine months. So, I should look toward '08 should we assume to use more of a run rate, should we average them all, and is your 10% to 15% growth guidance still pretty much intact for long-term care?

Michael D. Fraizer - Chairman, President and Chief Executive Officer

Let me turn that over to Buck Stinson.

Thomas M. Stinson - President, Long-Term Care Insurance

Yes, hi. The core business is going to be in that high 20, 30 range for the quarter. But what we're going to benefit from in 2008 obviously is the rate action on the in-force blocks. And so you’ll have the additional premium, we’ve also got continued strong growth across our individual and group lines in the linked benefits, so you'll start to see the benefit from that as well. So, the 10% to 15% growth guidance that we gave you is still intact.

Michael D. Fraizer - Chairman, President and Chief Executive Officer

Okay. And Buck, would that be roughly… it will be 10% to 15% of full year, not kind of where we ended the year.

Thomas M. Stinson - President, Long-Term Care Insurance

Yes, of the full year.

Patrick B. Kelleher- Senior Vice President – Chief Financial Officer

This is Pat. I would add that use the full year and use the averages because when we look at this, we see that kind of lapse rates on the block, termination rates on the block tend to down some quarter to quarter, so you have to look at it over a series of quarters.

Thomas Gallagher - Credit Suisse

Great. Thank you.

Alicia Charity - Vice President, Investor Relations

Okay. Well, thank you all for joining us this morning, and look forward for your participation in our call at 11. Materials for that call are posted on our website now if you wanted to take a look at them early, and again thank you for joining us.

Operator

Ladies and gentlemen, this concludes Genworth Financial’s fourth quarter earnings conference call. Thank you for your participation. At this time the call will end.

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Source: Genworth Financial, Inc. Q4 2007 Earnings Call Transcript
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