8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 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): October 29, 2008

STEWART INFORMATION SERVICES CORPORATION

(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

DELAWARE	001-02658	74-1677330
(STATE OR OTHER JURISDICTION)	(COMMISSION FILE NO.)	(I.R.S. EMPLOYER IDENTIFICATION NO.)

1980 Post Oak Blvd, Houston, Texas 77056

(Address Of Principal Executive Offices) (Zip Code)

Registrant's Telephone Number, Including Area Code: (713) 625-8100

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:

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

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

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CRF 240.14a-12)

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13a-4))

ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION.

A press release issued by Stewart Information Services Corporation on October 29, 2008, regarding financial results for the three months and nine months ended September 30, 2008, is attached hereto as Exhibit 99.1, and the first paragraph and the financial statements at the end of the release are incorporated herein by reference. This information is not deemed to be "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934 and is not incorporated by reference into any Securities Act registration statements.

ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.

(d) EXHIBITS

Exhibit No. Description

99.1Press release of Stewart Information Services Corporation dated October 29, 2008, reporting financial results for the three months and nine months ended September 30, 2008.

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 thereunto duly authorized.

STEWART INFORMATION SERVICES CORPORATION (Registrant)
By:	/S/ J. Allen Berryman
	(J. Allen Berryman, Executive Vice President, Secretary, Treasurer and Principal Financial Officer)

Date: October 29, 2008

EX-99.1

NEWS from:

STEWART INFORMATION SERVICES CORPORATION
P.O. Box 2029, Houston, Texas 77252-2029
www.stewart.com
Contact:	Ted C. Jones
	Director - Investor Relations
	(713) 625-8014

FOR RELEASE AT 6AM CDT

Stewart Reports Operating Results

for the Third Quarter and First Nine Months of 2008

HOUSTON, October 29, 2008 - Stewart Information Services Corporation (NYSE: STC) today reported the results of its operations for the third quarter and nine months ended September 30, 2008. (Dollar amounts in the table below are in millions, except per share figures.)

	Third Quarter (a)
	2008			2007
Total revenues	$	395.2		$	501.9
Pretax loss before minority interests		(39.7	)		(19.9	)
Net loss		(30.0	)		(14.3	)
Net loss per share		(1.66	)		(0.79	)

	Nine Months (b)
	2008			2007
Total revenues	$	1,217.9		$	1,607.0
Pretax loss before minority interests		(124.7	)		(5.3	)
Net loss		(83.9	)		(8.9	)
Net loss per share		(4.64	)		(0.49	)

(a) The third quarter of 2008 includes net pretax charges of $5.6 million ($3.6 million after taxes, or $0.20 per share), comprising a charge of $10.5 million for loss reserves relating to large title claims, an impairment charge of $2.6 million relating to equity securities held for investment and office closure costs of $2.5 million offset by a reduction in title losses due to recoveries recorded on a fidelity bond of $10.0 million. The third quarter of 2007 includes pretax charges of $17.1 million ($11.1 million after taxes, or $0.61 per share) relating to large title claims totaling $6.0 million and a reserve adjustment of $11.1 million relating to current and prior year policies. The third quarter of 2007 also includes a pretax gain on the sale of property of $5.6 million ($2.0 million after taxes and minority interests, or $0.11 per share).

(b) The first nine months of 2008 include net pretax charges of $41.3 million ($26.8 million after taxes, or $1.48 per share) relating to reserve adjustments of $10.0 million for prior policy years, $28.2 million relating to large title claims and agency defalcations, a software impairment charge of $6.0 million, office closure costs of $4.4 million and an impairment of equity securities held for investment of $2.6 million. These charges were offset somewhat by a reduction in title losses due to recoveries recorded on a fidelity bond of $10.0 million. The first nine months of 2007 includes pretax charges of $24.5 million ($15.9 million after taxes, or $0.87 per share) relating to a charge of $13.4 million for large title claims and a $11.1 million charge for reserve adjustments relating to current and prior year policies. These charges were offset by gains from the sales of businesses and property totaling $8.8 million ($4.1 million after taxes and minority interests, or $0.22 per share).

Financial Results

Issues in the credit markets intensified significantly during the third quarter of 2008, which resulted in a severe tightening of available credit. Residential building permits on an annualized basis have fallen to the lowest level since prior to 1980. Existing home sales were 7.7 percent less on a seasonally-adjusted annualized basis in the third quarter of 2008 when compared with the same period in 2007. This is a direct result of oversupply, foreclosures, declining prices, economic uncertainty and more stringent loan underwriting standards, in spite of lower interest rates. Commercial transactions have also been negatively impacted as a result of the financial market tightening and limited lending due to more stringent underwriting standards. As a result, our orders opened dropped 26.9 percent in the third quarter compared with a year ago.

Revenues in the third quarter of 2008 fell to $395.2 million, a decline of 21.3 percent from the $501.9 million in the same period last year. The decline in revenues contributed to a loss (before taxes and minority interests) of $39.7 million in the third quarter of 2008 compared with a loss of $19.9 million in the third quarter of 2007.

Total revenues for the first nine months of 2008 were $1.2 billion, down 24.2 percent from $1.6 billion for the same period in 2007. Overall, the Company reported a loss (before taxes and minority interests) of $124.7 million in the first nine months of 2008 compared with a loss of $5.3 million in the same period in 2007.

Our international operations remained profitable for the third quarter and year-to-date periods, somewhat offsetting the loss in our U.S. residential operations. In addition, our overall results for the third quarter and year-to-date 2008 reflect the benefits of our ongoing cost reduction initiatives. Employee costs and other operating expenses decreased significantly in the third quarter and year-to-date periods of 2008 when compared with the same periods in 2007. Although lower in the current year periods compared with 2007, other operating expenses have not declined at the same rate as our revenues due to the relatively fixed cost nature of many of our operations.

Our provision for title losses in the third quarter 2008 decreased over the same period in 2007, due primarily to charges recorded to strengthen reserves last year in the third quarter that were not required in the current year. We also recorded $10.0 million of insurance recoveries in the third quarter of 2008 relating to title losses filed against our fidelity bond, which were offset by a comparable increase in reserves for large losses. Our loss provision ratio remains at an elevated level compared to normal levels due to adverse payment experience relating to prior policy years and an increase in the frequency of large title losses and agency defalcations, which is to be expected during down-market cycles.

“We continue to aggressively cut operations that show continuing losses and unacceptable risk exposure. We have also canceled 1,750 independent agencies since June 1, 2008,” said Malcolm S. Morris, co-chief executive officer and chairman. “Even though the agencies being canceled are relatively minor to our total revenues, they represent a sizeable portion of our claims and management-related expenses. These cancellations are being accompanied by significant staff and overhead expense reductions within our underwriting companies,” added Morris.

“Development of new revenue and expense controls are our daily focus,” said Stewart Morris, Jr., co-chief executive officer and president. “We closed another 40 branch and office locations during the quarter and reduced headcount by 470 in the third quarter of 2008, bringing the total of our employee reductions to 2,900, or 29.3 percent, since December 31, 2006. Total closed branch and office locations since the beginning of 2008 is 110, which resulted in closure costs of $4.4 million. Revenue growth is being driven by sales training and marketing support to assist our existing sales associates in more effectively executing our strategies.

“Hurricane Ike in September had a significant adverse effect on revenues in the greater Houston area as a result of the postponement of transactions by affected participants,” added Morris. “While certain offices were closed following the hurricane, we lost no ongoing work and were not prevented from completing closings that needed to take place, once again proving the value of our investment in our paperless, Internet-based title processing and transaction management technology. Our prior planning and investment in preemptive actions and scripted disaster recovery were resources well spent.”

A major accomplishment this quarter was an agreement reached with UBS Bank regarding $241.5 million of auction rate securities held in exchanger funds by our tax-deferred property exchange business. UBS has provided a line of credit collateralized by the full par value of the auction rate securities. This line of credit has provided significant liquidity to the exchanger funds of our tax-deferred property exchange business. We expect the line of credit to be repaid in full through the transfer to UBS of the securities held as collateral at par value or pursuant to the settlement among UBS and various states and state regulatory agencies.

Stewart Information Services Corporation is a customer-driven, technology-enabled, strategically competitive, real estate information, title insurance and transaction management company. Stewart provides title insurance and related information services required for settlement by the real estate and mortgage industries throughout the United States and in international markets. Stewart also provides post-closing lender services, automated county clerk land records, property ownership mapping, geographic information systems, property information reports, document preparation, background checks and expertise in tax-deferred exchanges. More information can be found at www.stewart.com.

This press release may contain forward-looking statements, which include all statements other than statements of historical facts. Forward-looking statements are not guarantees of performance and no assurance can be given that Stewart's expectations will be achieved. Factors that could cause expected or anticipated results to differ from those described in the forward-looking statements include those factors described in Item 1A of Stewart’s annual report on Form 10-K for the year ended December 31, 2007. In particular, historical order counts do not necessarily indicate future revenues since Stewart cannot predict the number of orders that will result in closings.

STEWART INFORMATION SERVICES CORPORATION

STATEMENTS OF EARNINGS

(In thousands of dollars, except per share amounts)

	Three months ended						Nine months ended
	September 30						September 30
	2008			2007			2008			2007
Revenues
Title insurance:
Direct operations		176,381			234,161			557,655			734,203
Agency operations		208,558			235,621			613,124			784,309
Real estate information		9,110			16,510			35,128			49,540
Investment income		7,015			8,800			22,551			27,018
Investment and other (losses) gains - net		(5,832	)		6,826			(10,541	)		11,950
		395,232			501,918			1,217,917			1,607,020
Expenses
Amounts retained by agencies		169,333			189,596			499,457			634,738
Employee costs		140,006			170,422			438,045			526,310
Other operating expenses		86,108			103,245			259,355			302,129
Title losses and related claims		29,644			46,642			108,961			113,618
Depreciation and amortization		8,360			10,403			26,401			30,437
Impairment of other assets		-			-			6,011			-
Interest		1,433			1,512			4,369			5,054
		434,884			521,820			1,342,599			1,612,286
Loss before taxes and minority interests		(39,652	)		(19,902	)		(124,682	)		(5,266	)
Income tax benefit		(11,269	)		(9,162	)		(45,556	)		(6,241	)
Minority interests		1,592			3,530			4,730			9,883
Net loss		(29,975	)		(14,270	)		(83,856	)		(8,908	)
Loss per share		(1.66	)		(0.79	)		(4.64	)		(0.49	)
Average number of shares (000)		18,109			18,114			18,082			18,206
Segment information:
Title revenues		386,122			485,408			1,182,789			1,557,480
Title pretax loss before minority interests		(35,118	)		(19,976	)		(112,425	)		(8,170	)
REI revenues		9,110			16,510			35,128			49,540
REI pretax (loss) earnings before minority interests		(4,534	)		74			(12,257	)		2,904
Selected financial information:
Cash (used) provided by operations		(25,066	)		(4,622	)		(71,706	)		14,810
Title loss payments - net of recoveries		30,809			34,356			100,272			82,233
Changes in other comprehensive earnings - net of taxes		(10,331	)		7,360			(17,827	)		7,907
Number of title orders opened (000):
July		40			54
August		35			53
September		35			43
Quarter		110			150
Number of title orders closed (000):
Quarter		78			107

	September 30 2008		December 31 2007
Stockholders’ equity		655,176		754,059
Number of shares outstanding (000)		18,155		18,031
Book value per share		36.09		41.82

STEWART INFORMATION SERVICES CORPORATION

BALANCE SHEETS (condensed)

(In thousands of dollars)

	September 30			December 31
	2008			2007
Assets
Cash and cash equivalents		53,464			78,797
Cash and cash equivalents - statutory reserve funds		145,697			30,442
Total cash and cash equivalents		199,161			109,239
Short-term investments		54,735			79,780
Investments - statutory reserve funds		344,655			518,586
Investments - other		75,730			98,511
Receivables - premiums from agencies		35,903			48,040
Receivables - other		107,320			93,335
Allowance for uncollectible amounts		(13,994	)		(11,613	)
Property and equipment		87,165			96,457
Title plants		78,873			78,245
Goodwill		210,033			208,824
Intangible assets		11,999			17,157
Other assets		122,477			105,413
Other assets - pledged (a)		230,250			-
		1,544,307			1,441,974
Liabilities
Notes payable		146,811			108,714
Line of credit (a)		188,050			-
Accounts payable and accrued liabilities		92,933			122,167
Estimated title losses		447,078			441,324
		874,872			672,205
Minority interests.		14,259			15,710
Contingent liabilities and commitments
Stockholders' equity
Common and Class B Common Stock and additional paid-in capital		143,996			141,196
Retained earnings		513,262			597,118
Accumulated other comprehensive earnings		2,015			19,842
Treasury stock.		(4,097	)		(4,097	)
Total stockholders' equity.		655,176			754,059
		1,544,307			1,441,974

(a) The remaining $42.2 million available under the line of credit was drawn on October 1, 2008, resulting in an outstanding balance of $241.5 million, which is fully collateralized by auction rate securities noted above as other assets - pledged. The auction rate securities and line of credit, as recorded above, are each reduced by $11.3 million relating to fair value adjustments. These fair value adjustments offset in investment and other (losses) gains - net and result in no net impact to the consolidated statement of earnings.

October 29, 2008