The Arlington, Va.-based investment bank FBR & Co. has raised $550 million this week to fund NMI Holdings Inc., a new mortgage insurance company.
According to a Bloomberg News report, FBR underwrote a private offering of NMI shares. NMI was formed as an FBR subsidiary, and the investment bank plans to hold a stake of less than 5% in the new firm.
NMI will need approval from Fannie Mae or Freddie Mac before it can operate. It would be the second new entry in the mortgage insurance industry since the collapse of the housing bubble.