8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): February 26, 2013

THE PMI GROUP, INC.

(Exact Name of Registrant as Specified in Its Charter)

Delaware

(State or Other Jurisdiction of Incorporation)

001-13664	94-3199675
(Commission File Number)	(IRS Employer Identification No.)
PMI Plaza, 3003 Oak Road, Walnut Creek, California	94597-2098
(Address of Principal Executive Offices)	(Zip Code)

(925) 658-7878

(Registrant’s Telephone Number, Including Area Code)

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240-13e-4(c))

ITEM 7.01 Regulation FD Disclosure.

On February 26, 2013, The PMI Group, Inc. (the “Registrant”), filed its monthly operating report for the period from January 1, 2013 through January 31, 2013 (the “January Monthly Operating Report”) with the United States Bankruptcy Court for the District of Delaware (the “Court”).

The January Monthly Operating Report is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

Before reading the January Monthly Operating Report, we strongly urge you to read the cautionary statements regarding the January Monthly Operating Report below.

Cautionary Statements Regarding Financial and Operating Data

The Registrant cautions investors and potential investors not to place undue reliance upon the information contained in the January Monthly Operating Report, as it was not prepared for the purpose of providing the basis for an investment decision relating to any of the securities of the Registrant. The January Monthly Operating Report was not prepared in accordance with U.S. generally accepted accounting principles, was not audited or reviewed by independent accountants, will not be subject to audit or review by the Registrant’s external auditors at any time in the future, is in a format consistent with applicable bankruptcy laws, and is subject to future adjustment and reconciliation. There can be no assurances that, from the perspective of an investor or potential investor in the Registrant’s securities, the January Monthly Operating Report is accurate or complete. The January Monthly Operating Report contains a further description of limitations on the information contained therein. The January Monthly Operating Report also contains information for periods which are shorter or otherwise different from those required in the Registrant’s reports pursuant to the Securities Exchange Act of 1934 (the “Exchange Act”), and such information might not be indicative of the Registrant’s financial condition or operating results for the period that would be reflected in the Registrant’s financial statements or in its reports pursuant to the Exchange Act. Results set forth in the January Monthly Operating Report should not be viewed as indicative of future results.

Cautionary Statement Regarding Forward-Looking Statements

This Current Report on Form 8-K and Exhibit 99.1 hereto may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the Registrant’s financial condition, results of operations, and business that is not historical information. As a general matter, forward-looking statements are those focused upon future or anticipated events or trends and expectations and beliefs relating to matters that are not historical in nature. The words “believe,” “expect,” “plan,” “intend,” “estimate,” or “anticipate” and similar expressions, as well as future or conditional verbs such as “will,” “should,” “would,” and “could,” often identify forward-looking statements. The Registrant believes there is a reasonable basis for its expectations and beliefs, but they are inherently uncertain, and the Registrant may not realize its expectations and its beliefs may not prove correct. The Registrant undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise. The Registrant’s actual results and future financial condition may differ materially from those described or implied by any such forward-looking statements as a result of many factors that may be outside the Registrant’s control. Such factors include, without limitation: (i) the ability of the Registrant to develop, prosecute, confirm, and consummate any plan of reorganization or liquidation with respect to the Chapter 11 proceeding of the Registrant before the Court (“the Chapter 11 Proceeding”); (ii) the Registrant’s ability to obtain court approval with respect to motions in the Chapter 11 Proceeding; (iii) risks associated with third parties seeking and obtaining court approval for the appointment of a Chapter 11 trustee; and (iv) the potential adverse impact of the Chapter 11 Proceeding on the Registrant’s liquidity or results of operations. This list is not intended to be exhaustive.

ITEM 9.01 Financial Statements and Exhibits.

(d) Exhibits

99.1 Registrant’s Monthly Operating Report for the period from January 1, 2013 through January 31, 2013.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: February 26, 2013	The PMI Group, Inc.
	(Registrant)
	By:	/s/ Dario M. Nolasco
		Dario M. Nolasco
		General Counsel

EX-99.1

Exhibit 99.1

UNITED STATES BANKRUPTCY COURT

DISTRICT OF DELAWARE

In re The PMI Group, Inc. Case No. 11-13730 (BLS) Reporting Period: 1/1/13-1/31/13

MONTHLY OPERATING REPORT

File with Court and submit copy to United States Trustee within 20 days after end of month

Submit copy of report to any official committee appointed in the case

REQUIRED DOCUMENTS	Form No.	Document Attached	Explanation Attached	Debtor’s Statement
Schedule of Cash Receipts and Disbursements	MOR-1	X
Bank Account Reconciliations, Bank Statements and Cash Disbursements Journal	MOR-1(a)			X
Schedule of Professional Fees Paid	MOR-1(b)	X
Statement of Operations	MOR-2	X
Balance Sheet	MOR-3	X
Status of Postpetition Taxes	MOR-4			X
Summary of Unpaid Postpetition Accounts Payable	MOR-4(a)	X
Debtor Questionnaire	MOR-5	X

I declare under penalty of perjury (28 U.S.C. Section 1746) that this report and the attached documents are true and correct to the best of my knowledge and belief.

Signature of Debtor	Date
Signature of Joint Debtor	Date
/s/ L. Stephen Smith	2/22/13
Signature of Authorized Individual*	Date
L. Stephen Smith	Chief Executive Officer and Chairman of the Board
Printed Name of Authorized Individual	Title of Authorized Individual

* Authorized individual must be an officer, director or shareholder if debtor is a corporation; a partner if debtor is a partnership; a manager or member if debtor is a limited liability company.

NOTES TO MONTHLY OPERATING REPORT

The PMI Group, Inc., a debtor and debtor in possession (the “Company” or “Debtor”), hereby submits its Monthly Operating Report (the “MOR”).

1. Description of the Cases. On November 23, 2011 (the “Petition Date”), the Debtor filed a voluntary petition with the Bankruptcy Court for reorganization under Chapter 11 of the Bankruptcy Code. The Debtor is operating its business as a debtor-in-possession pursuant to sections 1107(a) and 1108 of the Bankruptcy Code.

2. Basis of Presentation. The MOR is limited in scope, covers a limited time period and has been prepared solely for the purpose of complying with the monthly reporting requirements to the United States Bankruptcy Court. The financial information in the MOR is preliminary and unaudited and does not purport to show the financial statements of the Debtor in accordance with Generally Accepted Accounting Principles (“GAAP”) and, therefore, may exclude items required by GAAP, such as certain reclassifications, eliminations, accruals, valuations and disclosure items. The Debtor cautions readers not to place undue reliance upon the MOR. There can be no assurance that such information is complete and the MOR may be subject to revision.

The information contained in the MOR has been derived from the Debtor’s books and records in conjunction with information available from non-debtor affiliates. This information, however, has not been subject to procedures that would typically be applied to financial information presented in accordance with GAAP, and upon the application of such procedures, the Debtor believes that the financial information could be subject to changes and these changes could be material. The information furnished in this MOR includes primarily normal recurring adjustments but does not include all of the adjustments that would typically be made for financial statements prepared in accordance with GAAP. In addition, certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted.

3. Recoveries and Causes of Action. The MOR, the Debtor’s Schedules of Assets and Liabilities and Statements of Financial Affairs may not include a complete list of causes of action it possesses as of the Petition Date or at any point thereafter. Regardless of the recoveries and causes of action listed, the Debtor reserves all of its rights with respect to any and all causes of action it may possess, including, but not limited to, avoidance actions or to assert any defenses, and nothing in this MOR shall be deemed a waiver or limitation of any of the Debtor’s rights to pursue any such causes of action or recovery or assert any defenses.

4. Reorganization Items. American Institute of Certified Public Accountant Statement of Position 90-7, “Financial Reporting by Entities in reorganization under the Bankruptcy Code” (“SOP 90-7”) requires separate disclosure of reorganization items such as realized gains and losses from the settlement of pre-petition liabilities, provisions for losses resulting from the reorganization and restructuring of the business as well as professional fees directly related to the process of reorganizing the Debtor under Chapter 11. Such items are reflected in the MOR as Bankruptcy Related Expenses.

5. Liabilities Subject to Compromise. As a result of the Chapter 11 filing, most pre-petition indebtedness is subject to compromise or other treatment under a plan of reorganization. Generally, actions to enforce or otherwise effect payment of pre-petition liabilities are stayed. The Debtor has been paying and intends to continue to pay undisputed post-petition claims in the ordinary course of business. In addition, the Debtor may reject pre-petition executory contracts with respect to the Debtor’s operations with the approval of the Bankruptcy Court. Damages resulting from rejection of executory contracts are generally treated as general unsecured claims and will be classified as liabilities subject to compromise. The pre-petition liabilities that are subject to compromise are reported herein at the amounts expected to be allowed, although they may be settled for lesser amounts. The amounts currently classified as liabilities subject to compromise may be subject to future adjustments depending on Bankruptcy Court actions, further developments with respect to disputed claims, determinations of the secured status of certain claims, the values of any collateral securing such claims or other events. While GAAP requires fair market adjustments to certain obligations, including funded debt, this MOR states such obligations at notional value, including pre-petition accrued interest.

6. Post-petition Accounts Payable. The Debtor has paid and continues to pay post-petition, undisputed invoices in the ordinary course and on generally agreed-upon terms.

7. Investments in Subsidiaries. Financial information related to any of the Debtor’s investments in its subsidiaries has been derived from the Debtor’s books and records in conjunction with the information available from non-debtor affiliates. Any information contained in this report pertaining to the Debtor’s investments in its subsidiaries should be viewed as preliminary and subject to revision.

8. Non-Cash Compensation Expense. Prior to the Petition Date, certain employees of the Debtor and its subsidiaries were granted stock-based compensation (including options). The Debtor has not expensed or accrued post-petition expense for outstanding stock-based grants and other stock-based compensation.

9. Cash and Fixed Income Securities. Cash balances include investment holdings consisting of U.S. Treasury Bills, primarily with a maturity of three months or less. These investments are listed at their initial purchase price and interest will be recognized at maturity.

As part of a settlement with PMI Mortgage Insurance Co. (“MIC”), the Company’s title to a note receivable from Impact Community Capital LLC (“Impact Tranche E Note”) was clarified and the Company entered into an agreement for MIC to purchase the Impact Tranche E Note. The sale was approved by the Bankruptcy Court on January 22, 2013 and completed on February 12, 2013. Due to the timing of the sale completion date, the Impact Tranche E Note continues to be classified as a Fixed Income Security in this MOR.

10. Pre-Paid Assets. Pre-Paid Assets primarily consist of insurance policies being amortized on a straight-line basis over the life of each policy.

11. Deferred Assets and Liabilities and Other Accruals. The Debtor has reversed certain accruals for pre-petition non-cash assets and liabilities, such as unamortized debt issuance expenses. There is significant uncertainty respecting the Debtor’s ability to utilize its

deferred tax attributes; accordingly, a full valuation allowance has been applied to the deferred tax asset and no tax benefit or provision has been recognized.

12. Intercompany Balances. The “Accounts Receivable – Affiliates” and Post-petition “Accounts Payable – Intercompany” should be viewed as preliminary and subject to further revision. Given the timing of this filing, the Debtor and its affiliates may be required to make adjustments that may not be reflected in the period in which they occur.

The PMI Group, Inc.

Cash Receipts and Disbursements

January 1, 2013 to January 31, 2013

MOR - 1

Total Cash Receipts	$	20
Operating Disbursements
Employee Compensation		106,480
Payroll Taxes		2,701
Employee Benefit Costs		1,922
Consultants and Temporary Staff		—
Ordinary Course Professional Fees		143,462
Intercompany Payments (non-employee)		36,552
Travel		—
Tax Payments		3,518,117
Board Compensation and Travel		147,500
Other (misc. G&A and contingencies)		9,700
Total Operating Disbursements		3,966,433
Bankruptcy Related Expenses
Debtor Professionals		284,788
UCC Professionals		19,611
Claims Administrators		—
US Trustee		7,800
Total Bankruptcy Disbursements		312,198
Total Disbursements		4,278,631
Net Cash Flow	$	(4,278,612	)
Beginning Cash Balance as of 1-1-2013	$	202,321,964
Change in Cash		(4,278,612	)
Ending Cash Balance as of 1-31-2013	$	198,043,352

The PMI Group, Inc.

Schedule of Bank Accounts and Balances

As of January 31, 2013

MOR - 1a

Note: All bank accounts have been reconciled for the period presented.

Name of Bank	Account Name	Bank Account Number	Balance
Bank of America	Main Account	xxxxxx0476		77,735,670.53
Bank of America	Payroll Account	xxxxxx0423		41,465.09
Bank of America 1	Investment Account	xxxx0C80		119,974,216.68
Bank of New York	Cash Securities	xxx430		276,969
Commonwealth National Bank	Gateway	xxx3169		15,031
Total			$	198,043,352

¹ Investment account holdings consist of three month U.S. Treasury Bills and are listed at initial purchase price.

The PMI Group, Inc.

Schedule of Professional Fees Paid

January 1, 2013 to January 31, 2013

MOR - 1b

Payee	Period Covered	Amount
Osborn Maledon	September 2012 - November 2012	$	23,369
Roshka DeWulf and Patten	September 2012 - October 2012		3,641
Goldin Associates, LLC	December 2012		96,274
Young Conaway Stargatt & Taylor	October 2012		165,145
Womble Carlyle Sandridge & Rice	September 2012 - October 2012		15,970
Total Professional Fees		$	304,398

STATEMENT OF OPERATIONS

THE PMI GROUP, INC.

For the Month Ended January 31, 2013

MOR - 2

Total Revenues	$	—
Payroll Expense		118,582
Other Recurring Expenses		436,480
Total Recurring Expenses		555,062
Non-Recurring Expenses - Bankruptcy Related		611,795
Total Expenses		1,166,858
Interest and Dividends		—
Equity Earnings		(42,859	)
Gain (Loss) on Investments		—
Net Investment Income		(42,859	)
Non-Cash Interest Expense		—
Income (Loss) before Tax		(1,209,717	)
Tax Provision (Benefit)		—
Net Income (Loss)	$	(1,209,717	)

BALANCE SHEET

THE PMI GROUP, INC.

As of January 31, 2013

MOR - 3

Assets
Fixed Income Securities	$	412,729
Cash		198,043,352
Investments in Subsidiaries		5,435,713
Accounts Receivable—Affiliates		109,908
Pre-Paid Assets		8,998,821
Tax Refund Receivable		3,133,508
Total Assets	$	216,134,031
Liabilities Not Subject to Compromise
Accrued Expenses	$	2,968,289
Accounts Payable		5,229,361
Accounts Payable—Intercompany		73,176
Other Liabilities		217,048
Liabilities Not Subject to Compromise	$	8,487,874
Liabilities Subject to Compromise
Pre-Petition Bond Debt	$	742,553,677
Accounts Payable		49,197
Accounts Payable—Intercompany		1,357,140
Liabilities Subject to Compromise	$	743,960,014
Total Liabilities	$	752,447,889
Common Stock	$	1,970,788
Additional Paid in Capital and Accumulated Deficit		735,120,262
Treasury Shares		(1,273,404,907	)
Total Equity	$	(536,313,858	)
Total Liabilities and Equity	$	216,134,031

The PMI Group, Inc.

Summary of Post-Petition Taxes

For the Month Ended January 31, 2013

MOR - 4

Representation: The PMI Group, Inc.’s 2011 federal income tax return, filed on September 12, 2012, indicates taxes owing of $4,862,835 (not including penalties or interest).

The PMI Group, Inc.

Summary of Post-Petition Debts

For the Month Ended January 31, 2013

MOR - 4a

Unpaid Post-Petition Debts
	Current		0-31 Days		31-60 Days		61-90 Days		Over 90 Days		Total
Total Operating Activity Payables	$	—	$	—	$	—	$	—	$	5,116,243	$	5,116,243
Total Bankruptcy Activity Payables		113,118		—		—		—		—		113,118
Total Post-Petition Payables	$	113,118	$	—	$	—	$	—	$	5,116,243	$	5,229,361

Note: Operating Activity Payables include a gross taxes payable amount of $ 5,116,243 related to The PMI Group, Inc.’s 2011 federal income tax return, filed on September 12, 2012. This amount includes the penalties and interest that would have been payable on the tax due of $4,862,835, per a Notice of Unpaid Balance from the Internal Revenue Service dated October 8, 2012, had payment of such $5,116,243 amount been made to the Internal Revenue Service by no later than October 22, 2012.

The PMI Group, Inc.

Debtor Questionnaire

For the Month Ended January 31, 2013

MOR - 5

DEBTOR QUESTIONNAIRE

Must be completed each month		Yes	No
1.	Have any assets been sold or transferred outside the normal course of business this reporting period? If yes, provide an explanation below.			x
2.	Have any funds been disbursed from any account other than a debtor in possession account this reporting period? If yes, provide an explanation below.			x
3.	Have all postpetition tax returns been timely filed? If no, provide an explanation below.	x
4.	Are workers compensation, general liability and other necessary insurance coverages in effect? If no, provide an explanation below.	x
5.	Has any bank account been opened during the reporting period? If yes, provide documentation identifying the opened account(s). If an investment account has been opened provide the required documentation pursuant to the Delaware Local Rule 4001-3.			x