July 20, 2011 / 8:39 PM / in 6 years

CORRECTED - OFFICIAL-UPDATE 1-Genworth sees Q2 loss

(Corrects to remove reference to Canadian shares in third paragraph. Follows clarifying information from Genworth that it is not using Canadian subsidiary shares to increase reserves in mortgage unit.)

* Shares fall 7.5 pct after hours

* Genworth forecasts second quarter loss

NEW YORK, July 20 (Reuters) - Insurer Genworth Financial Inc (GNW.N) forecast a second-quarter loss on Wednesday and said it will increase reserves in its mortgage insurance unit.

Genworth expects a net loss of $92 million to $112 million, or 19 cents to 23 cents per share. On an operating basis, it expects to lose 14 cents to 18 cents per share. Analysts polled by Thomson Reuters I/B/E/S expected on average a profit of 25 cents per share.

Genworth said it would increase reserves in its mortgage insurance unit by $300 million.

Earlier this week, the largest publicly traded mortgage insurer, MGIC Investment Corp (MTG.N), lost a quarter of its value after it posted a loss on spiking mortgage defaults.

Genworth shares fell 7.5 percent in after-hours trading following the warning. (Reporting by Ben Berkowitz; editing by Andre Grenon)

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